The Great Telecom Cash Flow Crisis (And why it’s threatening the entire industry)
If you’ve worked in telecom contracting for more than a minute, you already know this story: Crews grind day after day, invoices go out, but the money? Nowhere to be found.
❌ 90–120 day terms.
❌ Clients holding retainage like ransom.
❌ Factoring companies swooping in like vultures to take their cut.
Meanwhile, contractors are left begging banks for loans just to keep payroll going. The work is finished, the fiber is in the ground, the invoices are approved—but the checks don’t come.
This isn’t just a “contractor problem.” It’s a systemic failure that’s threatening the health of the entire telecom industry.
The Human Cost
I talk to SMB owners every week who are one missed payroll away from shutting down. Crews waiting on paychecks. Family businesses mortgaging their homes to cover fuel and insurance while they wait for payment. Good companies—talented, experienced, hard-working—closing their doors not because they can’t do the work, but because they can’t survive the wait.
And here’s the kicker: It’s not just about keeping contractors afloat. Delayed payments mean projects slow down, quality suffers, and network reliability tanks. Communities waiting on broadband expansion are left hanging—all because the people building the future can’t get paid for the work they’ve already done.
The Rate Sheet Trap
On top of delayed payments, many SMBs are being locked into unrealistic rate sheets by large Primes and MSAs.
Here’s how it works:
A Prime lands a multi-year contract with a client or government entity.
They push non-negotiable rate sheets down to subcontractors.
Those rates often don’t reflect real-world costs—fuel, materials, labor shortages, insurance, or inflation.
SMBs are left with a terrible choice: Either take the work at rates that guarantee razor-thin or negative margins—or walk away and risk losing their place in the pipeline.
This isn’t just squeezing contractors. It’s hurting the entire ecosystem:
Crews are forced to cut corners just to survive.
Contractors burn out and exit the industry.
Long-term projects end up costing more when the workforce can’t sustain itself.
By forcing unrealistic rates, Primes and MSAs aren’t just protecting their margins—they’re bleeding the very companies they depend on.
Why This Matters for Everyone
When cash flow collapses:
Contractors disappear → leaving primes scrambling for resources.
Talent exits the industry → skilled splicers, drillers, and linemen leave for steadier work.
Government dollars are wasted → projects stall or fail, hurting the very communities BEAD and other programs are meant to serve.
The race to the bottom on pricing created this mess. And now, the refusal to pay contractors in a timely manner—combined with unrealistic rate sheets—is pouring gasoline on the fire.
What Needs to Change
It’s time for an honest conversation:
Fair payment terms—Contractors aren’t banks. 90–120 days is unacceptable.
End predatory factoring—They’re draining SMB profits and keeping businesses weak.
Stop the rate sheet squeeze—Contracts must reflect actual market costs.
Industry-wide accountability—Primes and clients must prioritize sustainability, not just low bids.
Telecom is supposed to be the backbone of America’s future. But if the people who build it can’t survive, the entire system will collapse under its own weight.
My Message to Contractors
If you’re reading this and nodding your head because you’ve lived it—know this: you’re not alone. The frustration, the sleepless nights, the cash flow juggling act—it’s not just you, it’s systemic.
And until we push back as an industry, nothing changes.
Let’s start calling this out for what it is: The Great Telecom Cash Flow Crisis.
By: Mark Ramsey