Progress billing
Progress billing is invoicing for a job in installments as work is completed, rather than one lump sum at the end.
Each invoice (or draw) bills for the portion of work done to date, usually against a schedule of values. It keeps cash flowing during long jobs. Retainage is commonly withheld from each progress payment.
Related terms
- Draw schedule — A draw schedule sets the milestones at which a contractor can bill for (draw) payment on a job — e.g. at rough-in, drywall, and completion.
- Schedule of values (SOV) — A schedule of values breaks the contract price into line items so progress billing can be tied to the portion of each item that's complete.
- Retainage — Retainage is a percentage (often 5–10%) a customer withholds from each progress payment until the job is finished, to ensure completion.