After the holidays, credit managers go through what they call the “holiday hangover,” where people are slow to get back to business, which includes paying out bills, suppliers and contractors alike.

In other words, payment delays are to be expected, including contractors receiving what they’re owed.

2025 Credit Risks

Post-holiday payment delays are hitting contractors hard. The "holiday hangover" impacts bill paying, stretching payment cycles beyond the typical 45 days. In this brief episode, Thea Dudley, the "Credit Overlord," reveals how contractors can navigate cash flow, credit card usage and the rise of automated payment systems.

“The average contractor gets paid in about 90 days,” said Thea Dudley, CEO of Pocket Protectors. “The normal [days sales outstanding] that you’re shooting for is 45. I like to see below that, but 45 is the national average.”

Also known as the “Credit Overlord,” Dudley took a moment to discuss how these delayed payments are affecting contractors and how they can speed up the process. For instance, due to not collecting payments, contractors are forced to reduce what they would charge for a job just to remain competitive, which impacts cash flow.

On top of it, she said bill paying is becoming more complex, with many general contractors switching to an automated system that requires the subcontractor to use that platform.

“The good news is, if automation is already coming into your space like that, take it to that next step, see what those companies have that you're going to be able to use to collect your money, move to that automation to get your money collected,” she said.

On top of making sure payments arrive on time, Dudley provides insights into credit card usage, cybersecurity and what contractors can expect now that the Trump administration is officially in place.

View the full video here or download the podcast version and listen on the go.