Two Construction Companies do similar work for the similar customers using similar labor, materials, and subcontractors yet Company "A" earns twice the profits over Company "B."
Inside Company "B" Ten Minutes Of Waste Is Killing Their Profits!
It Is The Little Leaks That Sink The Big Ship!
Company A focuses on Strategy and Tactics. Company B only focuses on Tactics.
To paraphrase Sun Tsu "If the Strategy is correct, then a large number of tactical errors can be made, and the enterprise will be successful; however, efficient operations cannot overcome bad strategy."
Every Ten Minutes A Day Of Waste You Have In Your Construction Company
Is Destroying Your Profits, Your Future, And Your Life!
Harsh Words - And yes I know you are a tough contractor who is accustomed to people trying to sell you something and get in your pocket all the time, so you learn to ignore a lot of crap!
You Are Right I Am Trying To Sell You Something - I am trying to sell you to you and the importance of taking care of your construction company profits so they can take care of you.
Let's Get To It - There are 100's of improvements that can be made in any construction company and 20% of the improvements will have the most impact. 80% will have the least impact. See The 80-20 Rule For Construction.
Below I have listed the two biggest drivers of profit loss and the easiest ones to analyze and fix. Review them and leave a comment and I will personally respond to you.
Profit Drain #1 In-House Bookkeeper Until a construction company reaches at least $5 million in annual sales it cannot afford to hire a qualified construction bookkeeper or construction accountant.
The owner Hires A Cheap Bookkeeper part-time for $15.00 an hour 10 hours a week in an attempt to save money without understanding the actual cost is $25.29 per hour. See the chart below:
Every 10 Minutes A Day Of Unproductive Office Labor:
Costs Your Company $273.93 Each Year
At 10% Profit, You Need To Sell $2,739.30 More To Maintain The Same Profit Margin
In Some Cases, we can do more work for less money by providing you with construction bookkeeping and accounting + payroll processing + monthly and quarterly tax reports + year-end W-2, W-3 + profit and growth management consulting + financial and job costing reports + paperless data storage and more. As a bonus, we can show you how to use simple strategies to make more money faster!
Profit Drain #2Cheap Tools And Equipment Invest in the best tools and equipment you can afford because in the short run you will save money. Construction workers who take pride in their work and will produce better results faster with fewer repairs if they have quality tools and equipment.
Make More Money Faster with productivity gains. See the chart below:
Every 10 Minutes A Day Of Unproductive Construction Worker Labor:
For Employee #01 Costs Your Company $1,544.42 Each Year
At 10% Profit, You Need To Sell 15,544.20 More To Maintain The Same Profit Margin
For Example, your best construction worker asks for a tool that costs $1,200.00 and will last three years. The standard response is "we can't afford it!" The fact is you can't afford not too!
Highly Profitable construction company owners will ask their construction accountant to calculate the projected the Return on Investment (ROI) is and then consult their Strategic Business Plan to make an informed decision.
In This Example, it may make sense to finance the purchase even if it means using a credit card with a 12% interest charge because the Return on Investment (ROI) is $3,289.36 or 245% ROI. See the chart below:
Two Contractors Doing Similar Work for similar customers with the similar direct and indirect construction costs will have massively different net profits for the year. Their KPI Reports will be more favorable which means a more stable construction company. Size matters when it comes to piles of money and bigger profits!
Construction Success Is A Few Simple Disciplines Practiced Every Day
Construction Failure Is A Few Simple Errors in Judgement Repeated Every Day
When You Become A Client - Then we can tap into our resources of knowledge and strategy banks. We use the reports hidden in your QuickBooks in order to diagnose and understand your construction business and develop plans and help you implement a path to success for you and you alone because every contractor has unique Strengths, Weaknesses, Opportunities and Threats (S.W.O.T. Analysis) that when understood can lead to a Strategic Roadmap which cannot help but make a lot of money.
We Remove Contractor's Unique Paperwork Frustrations
For Construction Company Owners who do not need the full power of a QuickBooks for contractors and want 24/7 online access we offer Xero Accounting Online, and we have a custom setup for construction companies. Click Here For More.
This Is One More Example of how Fast Easy Accounting is helping construction company owners all across the USA including Alaska and Hawaii put more money in the bank to operate and grow your construction company. Construction accounting is not rocket science; it is a lot harder than that, and a lot more valuable to people like you so stop missing out! Call Sharie 206-361-3950 or sharie@fasteasyaccounting.com and schedule your no charge one-hour consultation.
Profitable Contractors and Construction Company owners have known about the value of outsourced bookkeeping services and contractor coaching services like ours for a long time, and now you know about it too!
Thank You For Reading This Far, And I Hope You Understand we really do care about you and all contractors regardless of whether or not you ever hire our services.
We Scan Your Receipts, And Invoices link the appropriate transactions to QuickBooks or Xero Accounting Online depending on the construction accounting service you are using and provide ongoing Cloud Based Contractors Bookkeeping Servicesby accountants who understand construction.
We Are Xero Accounting Experts Specializing In Construction Bookkeeping Services
About The Author:
Randal DeHart, PMP, QPA is the co-founder of Business Consulting And Accounting in Lynnwood Washington. He is the leading expert in outsourced construction bookkeeping and accounting services for small construction companies across the USA. He is experienced as a Contractor, Project Management Professional, Construction Accountant, Intuit ProAdvisor, QuickBooks For Contractors Expert and Xero Accounting Specialist. This combination of experience and skill sets provides a unique perspective which allows him to see the world through the eyes of a contractor, Project Manager, Accountant, and construction accountant. This quadruple understanding is what sets him apart from other Intuit ProAdvisors and Xero accountants to the benefit of all of the construction contractors he serves across the USA. Visit http://www.fasteasyaccounting.com/randal-dehart/ to learn more.
Our Co-Founder Randal DeHart - Is a Certified PMP (Project Management Professional) with several years of construction project management experience. His expertise is construction accounting systems engineering and process development. His exhaustive study of several leading experts including the work of Dr. W. Edward Deming, Michael Gerber, Walter A. Shewhart, James Lewis and dozens of others was the foundation upon which our Construction Bookkeeping System is based and continues to evolve and improve. Check out our Contractor Success Map Podcast on iTunes and Follow Randal on Google+
Most Contractors Setup QuickBooks Desktop Version In One Of Three Ways:
#1 EZ Step Interview inside QuickBooks Setup #2 Asked Their Tax Accountant To Setup QuickBooks #3 They Attended A How To Setup QuickBooks Class Or Seminar
And QuickBooks Does Not Work The Way They Want It Too!