Steady, reliable cash flow is crucial for the survival of your construction business – so taking steps to ensure your customers pay promptly is a key priority.

 

Debtor days refer to the length of time it takes clients, on average, to pay you for the work you've done. A higher number of debtor days means clients take longer to pay you. A lower number of debtor days means clients take less time to pay you, which means there's more cash available for your business to use. 

 

In the construction industry, debtor days can average as long as almost three months. Shortening that length can have a significant impact on your cash flow.

 

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Topics: Outsource, Do What You Do Best And Outsoure The Rest, Invoicing, Winning Teams, Clients, Contractor Guidance, contractor delegation

Most construction workers are good decent people who enjoy working with their hands making, building, repairing, remodeling, and fixing homes and commercial buildings.

 

Good construction workers will not tolerate chaos or unfair labor practices. They will try out many construction companies until they find a contractor with a system. Preferably with documented processes and procedures.

 

Desirable construction workers have these five traits in common:

• High Self Esteem
• Strong Work Ethic
• Always Learning
• Loyal To Family And Friends
• Law Abiding Citizen
  

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Topics: Hiring Employees, Outsource, Winning Teams, Contractor Guidance, contractor delegation

Construction company owners - predominantly service-based businesses with monthly or yearly client subscriptions, likely deal with some level of customer churn, especially given the COVID-19 pandemic. Even customers who love your business and services may have lapsed for various reasons. 

 

Whatever their reasons for leaving, it's still a great idea to win them back. Why? This is mainly because winning back a lost client still has a higher success rate than converting a prospect into a customer. After all, they've already hired your service once, so you don't have to convince them of the need. And you don't need to build brand awareness; they already know you exist. 

 

Even if you can't win everyone back, those yo u can bring back to your business will affect your bottom line–and will do so at less expensive overall. 

 

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Topics: QuickBooks For Contractors Financial Reports, Profit and Growth Strategies For Contractors, Contractor Guidance, contractor delegation

Every contractor who goes out of business has one thing in common, bad financial reports or none at all.

Does this sound familiar? Contractor opens a business because they are so skilled at trade. With a small amount of cash, less than $10,000, a few credit cards with $5,000 available credit, they are off to the races.

You tell friends and relatives about your new adventure and get lots of jobs. Of course, you wouldn't take advantage of friends or relatives at meager prices, would you?

You open supplier charge accounts credit cards from Home Depot and Lowes. Your working capital increased by $20,000. "Wow, life is excellent! I should have done this a long time ago!"

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Topics: Construction Company Failure, QuickBooks Contractors Financial Reports, Bad Construction Bookkeepers, Construction Bookkeeping And Accounting, Contractor Guidance

When you run your own business, it's tempting to take on every responsibility. There are many reasons for doing so: you want something done a specific way because you don't have the time to explain how to do it or because you're not sure someone else can handle the task. 

 

Delegating saves you valuable time and energy. Sharing duties with your team also fosters a sense of responsibility, engages them, and helps them develop their skills. 

 

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Topics: Outsource, Do What You Do Best And Outsoure The Rest, Winning Teams, Contractor Guidance, contractor delegation

Several aspects of the construction business can only be learned through experience. One of them is negotiating contracts. 

 

Owning your business requires many skills, and among the most important might be the ability to manage negotiations. As a business owner, you could find yourself negotiating in many circumstances, such as: 

 

• Salary and job expectations with a potential employee 
• Financing terms with a lender
• Payment terms with a supplier
• Lease or property agreements
• Equipment agreements.

 

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Topics: Leveling Up, Systems And Processes, Construction Business Negotiations, Negotiating Contracts

As your construction business grows, it's essential to have trusted financial professionals managing your books and providing strategic financial advice. 

 

After all, the busier you get, the more complex financial management becomes - and the less time you'll have to maintain your books and try to make sense of all the data. 

 

However, many construction business owners are not sure of the differences between a construction bookkeeper, a construction accountant, a financial planner, and a Certified Public Accountant (CPA) - or whether hiring one or all of them makes the most sense.

 

Keep in mind that each branch of accounting serves a different function similar to how it works in construction. There are framers, rough carpenters, and finish carpenters, and all three work with lumber, yet in most cases, the skill sets to do everything are rarely found in the same person.

 

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Topics: QuickBooks Contractors Financial Reports, Construction Bookkeeping And Accounting, Winning Teams, Contractor Guidance

When a business starts, it’s natural for the owner to be a jack-of-all-trades. You may not have the capital to hire specialists or access the technology to help you. As your business grows–or as you look to take a minor role in your construction company–you may find the industry has become over-reliant on you, which makes it difficult for you to take a step back. 

Have you M.A.P.ped your business yet? Consider this before retreating and delegating:

• Marketing - never sells more than Production can provide; on-time and on-budget
• Accounting - manages the money to maintain operations and produce a reasonable profit
• Production - delivers the project intending to exceed customer expectations

As you know, we are big on Marketing, Accounting, and Production; having a basic operation manual in place for your office, remote, and field employees pays off in the long run.

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Topics: Construction Strategy, Systems And Processes, Construction Company Cash Flow, Contractor Tips, Contractor Guidance

Every manager has habits that make them effective. Managing contractors doesn't just mean scheduling them and making sure they're progressing on the project, but also knowing how to address workplace matters proactively - for one, the growing generational differences among their peers to communicate effectively and boost productivity.

These days, it's inevitable that a diverse group of older and younger workers cross paths in the construction industry. After all, the young, tech-savvy, socially conscious Gen Y (Millennials) and Gen Z are currently the largest living generation in the U.S., navigating the workforce in record numbers. And the boomers may be retirement age, but that doesn't mean they're ready to stop working. Many baby boomers choose to enjoy "encore careers" – jobs that allow them to continue applying their skills and experience to personally meaningful projects.

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Topics: Leveling Up, Systems And Processes, Contractor Guidance

The daily processes and transactions involved in operating a general maintenance and repair contracting business can mean long hours of repetitive tasks and occasional oversights due to human nature. These days, you can use technology to take care of almost any issue facing your business.

Automating these tasks can result in significant savings in resources and eliminate mistakes caused by human error. The key, however, is to know which tasks should be automated and which ones warrant staff intervention and guidance. Let's discuss some of them:

 

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Topics: The Contractors Account, Cloud Based Bookkeeping Services, Outsourced Accounting For Contractors, Systems And Processes, Construction Company Cash Flow, Contractor Guidance