The problem for small shops
Retainage hits exactly where a shop feels it: cash. You buy material, fabricate, finish, deliver, install, fix punch items, and still wait on money that was earned months ago.
The clause to watch is not just the percentage. It is the trigger for release. If your money depends on final completion of the entire building, your shop is financing problems you did not create.
A cleaner structure
A fair retainage clause should connect release to your actual work. Once your millwork is accepted and your punch list is closed, the GC should have a short window to release retained funds for that scope.
If a GC needs to hold money for a specific defect, the hold should be limited to a reasonable amount tied to that defect, not the whole unpaid balance.