The key to making Xero Accounting Online work is ensuring your account is correctly set up and maintained. Perhaps you own a service and repair firm specializing in plumbing, electrical, HVAC, or maybe a handyman service or someone who does small construction projects that last from a few hours to a few days, and you only need to give your customer or client one invoice?
Suppose you've just started working with Xero; making a few mistakes while learning is expected. We see pretty common errors - and unfortunately costly - so you should be aware of them if you want to get the most out of Xero's powerful cloud accounting system.
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Topics:
Xero For Construction Companies,
QuickBooks Online Converted To Xero,
Construction Bookkeeping And Accounting,
What Is Xero Accounting Online,
Contractor Tips
Many surveys and reports show that nearly half of all new construction companies close their doors within the first five years of opening them. When we speak with contractors who failed, most say it was due to a lack of cash flow. It was pretty obvious, yet when questioned, all of them said they were "Blind-Sided" and were not aware they were running out of cash until it was too late.
There is a point when a contracting company starts to fail, and nothing short of a massive cash infusion can stop it, and a domino effect begins, which is when a series of similar or related events occur as a direct and inevitable result of one initial event.
Planning is essential to give your business the best chances for success. Planning means anticipating challenges and developing ways to successfully address them, so they don't upset your startup.
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Topics:
New Contractors,
Start Construction Company,
Profit and Growth Strategies For Contractors,
New Business Startup,
New Business,
Contractor Guidance,
Construction Business Goals
Several aspects of the construction business can only be learned through experience. One of them is negotiating contracts.
Most people fear the negotiation procedure because it is an intrinsically uncomfortable process. Asking for more money or making personal demands doesn't come naturally to everyone. But with the right toolkit, you can breeze through contract negotiations. And you'd better get used to it because you'll have to handle many contracts whether you're a construction company owner or employee.
Having the right mindset is critical to contract negotiations. You have to believe that you are going to get your way. Bring a positive attitude and a smile to the table. You're not signing contracts with the enemy. The people you're negotiating with will be your business partners in one capacity or another.
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Topics:
Construction Bookkeeping And Accounting,
Contractor Tips,
Contractor Guidance,
Construction Business Negotiations,
Negotiating Contracts
Cash flow refers to the movement of money into and out of your business. It's based on the amount of money you bring in minus the amount you spend. A positive cash flow means bringing in more than you're spending. A negative cash flow means you aren't bringing in enough to cover your expenses.
Your construction company can run into problems by not charging enough for goods or services, having late-paying clients, growing too quickly, or simply spending too much money.
Solid cash flow management is vital to ensuring your contracting business survives, but not everyone understands what cash flow is or how to manage it. That's likely what makes it a leading cause of stress for small business owners.
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Topics:
Construction Cash Flow,
Cash Flow,
Construction Bookkeeping And Accounting,
Increase Cash Flow,
Construction Systems And Processes,
Contractor Guidance
Knowing which jobs have the highest probability of success and profit before getting involved moves your construction company from an unpredictable roller coaster to a peaceful merry-go-round.
You have what appears to be a high-profit job, and now you think you have it made, and I hope you are right!
The problem is that high-profit jobs can turn into low or no-profit jobs. In some cases, they can bankrupt your construction company because you bid on the project using whatever model you are accustomed to using, and in the end, you wind up with cash flow problems.
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Topics:
High Profit Construction Projects,
Profit and Growth Strategies For Contractors,
Contractor Guidance,
Construction Business Goals
When you're a construction business owner, your to-do list is often long and constantly growing longer. You need to do many things, and it can feel like they're all urgent. In such cases, it's easy to push essential tasks to the side and focus on less-vital activities, but that often means you miss deadlines, make mistakes or always feel as though you're trying to catch up.
Construction Companies have two basic leadership styles; wait until an urgent situation occurs and react like a firefighter or develop business processes that allow the company to respond calmly and natural resources and solutions to the issues like a traffic police officer on a sunny afternoon.
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Topics:
Business Process Management For Contractors,
Winning Teams,
Construction Productivity,
Contractor Guidance,
contractor delegation
One of the biggest challenges construction company owners like you have with an in-house bookkeeper is training them to work for your best interest, not theirs, and deliver consistent results and the reports you can trust daily, year after year.
Having been involved with construction and construction accounting and bookkeeping for over thirty years, we have seen a consistent pattern repeated over and over that will turn ordinary, decent, pleasant bookkeepers into a disheveled, broken, mean, nasty, arrogant trolls, and that's a good day when the sun is shining, and the birds are singing!
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Topics:
Business Process Management For Contractors,
Winning Teams,
Construction Productivity,
Contractor Guidance,
contractor delegation
One of your greatest fears is wasting money on a less than good lead.
They may or may not have any genuine desire for services. Sometimes a person is committed to collecting three bids when they already have someone picked out to do the work. They may be looking for a "temporary friend" to do them a favor, or by the time you have completed the form, they have changed their mind and no longer want service. This is often the case when one spouse or partner wants the work done, and the other doesn't.
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Topics:
Profit and Growth Strategies For Contractors,
Construction Marketing,
offline marketing for contractors,
Contractor Guidance
Every day you make financial decisions about your company, which affect how successful and sustainable your construction business is. If you're responsible for the bookkeeping and all the paper management (bills, receipts, estimates, invoices), you could be making errors that affect your decisions. Because of an incorrect decimal place, you may think that you have more money in the bank than you do. Or you may not fully understand how a decision today affects your business tomorrow.
Keeping up with paperwork is a typical construction business time waster we noticed in more than thirty years in the industry. Doing your books often winds up costing you more money in the end, not to mention the time and energy that goes into a task you despise or, at the very least, don't fully understand.
This is one area that many construction company owners hate to be part of but still choose to take responsibility for.
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Topics:
Bookkeeping Services,
Construction Bookkeeping And Accounting,
Technology For Your Construction Company,
Construction Systems And Processes,
Contractor Guidance
Success in operating a profitable construction business is all about maintaining the proper balance of control over both The Profit Centers and The Cost Centers. If either one gets too powerful and is allowed to run your construction company, it can cause more damage than good.
The definition of a Non-Profit Construction Company is one that tries to fix its weaknesses and continues making the same mistakes repeatedly, expecting a different result and continues to struggle until the owner lays down and dies from over-work and exhaustion.
A Highly Profitable Construction Company builds on its strengths and core competencies and continues innovating, growing, and responding to changes in its environment.
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Topics:
Construction Bookkeeping And Accounting,
Technology For Your Construction Company,
Automated Data Entry,
Construction Systems And Processes,
Contractor Guidance,
Construction Business Budget
