How much cash should a security guard company keep?

A security company pays guards every week or two and bills clients monthly, often on 30 to 60 day terms. Labor is almost the whole cost. So the company finances its clients' security until they pay.

Payroll per run, all-in $ How often you run payroll Fixed bills per month (rent, loans, insurance, software) $ Days your customers take to pay, on average days Cash in the bank today $

Minimum to keep

Two payroll runs plus one month of fixed bills

Comfortable level

Covers costs while you wait for customers to pay, plus one month

Weeks your cash covers

If no customer paid you

The starting numbers are an example. Replace them with yours.

How cash moves in a security guard company

Guard wages are most of the cost, and they cannot wait.
A new contract needs guards on post before the first invoice is even sent.
Overtime to cover open shifts raises cost without raising the bill.
Large clients and property managers often pay slowly.

Why the usual rule falls short

Two security companies each bill $100,000 a month. One bills weekly with 15-day terms. The other bills monthly on 45-day terms. The second carries roughly two months of guard payroll for its clients.

How the calculator works

Result	Formula
Minimum to keep	2 × payroll per run + 1 month of fixed bills
Comfortable level	Monthly costs × (days to collect ÷ 30 + 1)
Weeks your cash covers	Cash ÷ weekly costs

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Also for security company owners, see the security guard company monthly financial report.