All construction contractors have experienced bad debt's financial pain, which is defined as a customer who refuses to pay no matter what you do.
I've been there before, and it will probably happen again in the future. Owning and operating any business, including accounting, means sometimes you provide goods and services and not get paid.
When you sat for an exam or a school test and knew the material forwards and backward, it was fast and easy. The exams and tests for the classes you struggled with were the opposite.
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Topics:
Construction Accounting,
Customers,
Contractor Challenges,
Contractor,
payment issues
Bookkeeping embezzlement stems from a feeling of entitlement and the need to get even. Your bookkeeper or accountant will steal if they feel confident they can get away with it and if circumstances allow for it due to weak integrity and a sense of "Redistributing The Wealth, But Not The Work Or The Responsibility."
It is estimated that the number of bookkeepers caught embezzling from contractors is less than one percent of the total. In most cases, the ones that are caught are rarely convicted because all too often, it is the contractor who has to spend thousands of dollars on forensic accountants and attorneys to prove the theft occurred.
In most cases, it is near impossible to persuade the authorities to prosecute when a contractor bookkeeper embezzles because it is often viewed as a "Victimless Crime."
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Topics:
New Contractors,
Bookkeeper Embezzlement,
Embezzlement,
Construction Accounting,
Contractor Bookkeeper Embezzlement,
Construction Bookkeeper Embezzlement,
Contractor Challenges,
Contractor
Proactive versus reactive are the two methods of getting something done. I find everyone works in a combination of both, I included.
Proactive is scheduling and doing everything ahead of time. Nothing is ever waiting until the last minute. Reactive is more emergency driven and are things that need to be done now.
As much as we plan, it would be best if you were flexible, adaptable, and reliant. Things happen that are beyond your immediate control. Those of you who want a predictable environment are employees working for a large employer where schedules are fixed, and they are doing the same things every day.
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Topics:
Construction Accounting,
Service Agreements For Your Contracting Company,
Service Agreements,
Contractor Challenges,
Lien Waivers,
Contractor
Freelancers in all industries deal with the same problems due to the nature of their work. Most of you came from the skilled craftsman trades, some of you worked as a manager for a construction company.
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Topics:
New Contractors,
Construction Accounting,
Contractor Challenges,
Contractor
If you're a small business owner whose construction company hasn't gone through hard times, that's great, but it's likely to happen at some point. As much as we dream about being brilliant enough in this industry that we'll never face slow times, there are many things beyond our control that can negatively affect our organization.
Here are six tips for getting your business through difficult periods so you can look forward to many more years of construction business ownership:
1. Take care of your employees
Workdays lost to sickness are a considerable cost to the company and a threat to productivity. Regardless of health threats and virus spread, the workplace itself is a source of infection, and you can reduce the risk of causing absence in your employees by implementing control measures to ensure the environment is clean and safe.
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Topics:
Construction Accounting,
Contractor Challenges,
Contractor,
Contractor Tips,
Contractor Operating Tips
Hiring an accountant is widely considered best practice for small business owners. But delegating financial analysis and reporting doesn't mean thoroughly checking out of the process each month or quarter. On the contrary, it's recommended that business owners work closely with their accountants throughout the year to better understand their financial position and make smart plans for future growth.
We have discussed time and again the importance of knowing the difference between Construction Accounting and Regular Accounting. For the sake of our new readers, blog subscribers, and podcast listeners, I'll be providing you with some basic accounting knowledge so you can have more informed, insightful discussions with your financial advisors before the year ends.
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Topics:
Contractor Challenges,
Contractor,
Contractor Tips,
Contractor Operating Tips,
Construction Productivity
Many complex moving parts are involved in operating a profitable construction company, but at its core, business success hinges on just one thing: customer relationships.
This is why Customer Relationship Management software is vital for contractors who want to grow their business.
A CRM solution helps your construction company nurture and improve client relationships by maintaining centralized data on all your leads and existing clients. With access to a history of customer transactions and communications, your team can make their next move with confidence while offering highly personalized customer service.
Construction business owners know that to find a loyal client base, they have to stand out from their competitors. One of the best and easiest ways to do that is to have outstanding customer service. How you treat your customers reflects your entire business. People think positively about companies that treat their customers and clients well.
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Topics:
Contractor Challenges,
Contractor,
Contractor Tips,
Contractor Operating Tips,
Construction Productivity
Be honest: is email helping or harming your construction business?
Remember when email was new and novel, and everyone thought it would vastly improve communication while freeing up time? It did improve communication - especially in the construction industry, where you have a team working on the field and in the office - on some levels, and freed up employee time at first. Now, however, email has become a productivity killer.
Construction business owners and workers have to wade through hundreds of emails in their inbox each day. Many contractors working on-site, choose to deal with email as it comes in rather than all at once. This takes the focus off their work and makes it difficult to concentrate on their tasks.
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Topics:
Contractor Challenges,
Contractor,
Contractor Tips,
Contractor Operating Tips,
Construction Productivity
A new contractor meets an experienced customer, and money changes hands and not the way you expect it.
Typically, this is what happens when you first get started: You bid on a project, and you are the low bidder. You are given the client's standard contract, which contains the client's favorite set of commercial terms and conditions, to sign as a condition of getting the project. You close and sign the contract because you don't want to ask for changes in the terms or consult your construction attorney. You put the signed contract in your bottom desk drawer and pray hard nothing will happen during the project that will cause you ever to have to reread the contract.
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Topics:
Construction Bookkeeping,
Processes,
Contractor Challenges,
Contractor,
contractor bookeeping services,
Contractor Tips
Owning a construction business means you understand that bookkeeping is just one of those mundane, nasty, dirty, aggravating, grubby little chores you get stuck with along with its rotten scoundrel cousin the Monthly/Quarterly Tax Reports.
If you have employees - look out! On top of everything else you have payroll to process, in some cases, you may decide to provide cash advances to your employees to keep them focused on the job and not on personal issues, and finally there are all the Payroll Taxes you need to keep track of and file the reports for on a regular basis.
Smart Contractors know their time is more valuable spent meeting prospective clients, putting together bids, managing job sites, and a whole lot of other things other than bookkeeping. So they find someone else to do it.
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Topics:
Construction Bookkeeping,
Processes,
Contractor Challenges,
Contractor,
contractor bookeeping services,
Contractor Tips
