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    Construction Company Strategy PAM vs. MAP?

    Posted by Randal DeHart on Thu, Sep 22, 2011

    Construction Company Growth Strategy

    Most Construction Companies Use "P.A.M"

    Step #1 P = Production, they have a job of two from friends and relatives and they put on their tool bag and go to work.

    ...But wait there's more- Since there is a perception of little or no overhead and they want to make a name for themselves so they work real cheap.

    ...But wait there's more- Some contractors will not markup any material or sub-contractor invoices in an effort to save their customers money. Again the perception of no overhead! Hmmmmm!

    ...But wait there's more- They are the big hearted contractors who labor under the illusion that if they work real hard and keep their prices low they will be someone who owns a business. In reality they have a JOB, with few if any benefits, little or no health insurance and no retirement disguised as a BUSINESS!

    Step #2 A = Accounting, they wait until the tax forms, nasty-grams, un-love letters and other assorted mail and phone calls from the Washington State Department of Revenue, Washington State Labor And Industries, Washington State Employment Security Department and the  IRS 940 and 941 department pile up. 

    ...But wait there's more- there must be a number of bounced checks with the involuntarily contribution to the bank the checks were drawn on and the stores that accepted them. 

    ...But wait there's more- now things are starting to get serious so they buy QuickBooks and use it like a check register.  Some useful reports would be nice...If only there was a way to push a button and get the reports they need by clicking here!

     QuickBooks For Contractors 2011

    Step #3 M = Marketing, when the low hanging fruit of friends and relatives "honey do projects" are complete they wait for referrals to come rolling in..and the phone rarely rings.

    ...But wait there's more- When it does ring it is a "Customer" Not a "Client", and there is a HUGE difference, looking for an "honest contractor". This means a victim who will work for less than wages and add lots of extra freebies at no charge!

    ...But wait there's more- The next order of business is get some business cards printed and put words like "Quality" "Best" "Low Prices" and other puffery that means nothing. Quality and speed are expected; the real question is what makes this company different what is their USP (Unique Selling Proposition)

    There Is A Better Strategy

     A Few Successful Construction Companies Use "M.A.P"

    Step #1 M = Marketing, they stop, look, listen and think about what are they good at and what do they love to do?  What jobs have they worked on in the past where they made a positive difference in people lives?  What projects are so much fun that time seemed to fly by? 

    ...But wait there's more- they take the information outlined above and write a story describing "Prime Customer and defining their target market.

    ...But wait there's more- They document and describe in detail the demographic and psychographic profiles of the people they enjoyed working for and why.

    ...But wait there's more- They use that information to develop the marketing plan and the particular niche of the construction market they will dominate. Knowing that over time their service will become legendary to such a degree their clients become raving fans and referrals do indeed become a part of the marketing strategy. Nordstrom has been very successful at this and it would be wise to learn from the leaders.


    Step #2 A = Accounting, they find someone who understands construction bookkeeping and accounting and outsources that chore to them in most cases for a lot less than an in-house bookkeeper.

    ...But wait there's more- Instead of a Bad Bookkeeper with little or no support and oversight they have the resources of a professional QuickBooks bookkeeping team that understands QuickBooks for construction accounting to support them and their construction business.

    Construction Company Strategies Compared

     Download The Graph Shown Above 

    ...But wait there's more- Professional Construction Bookkeeping Services have remote servers which means they offer clients 24/7 access to their QuickBooks desktop version.

    ...But wait there's more-  They guide clients on which reports to pay attention too and why certain reports can make them more money than other ones. Learn More about the KPI Reports Here

    Remote QuickBooks Desktop Version In The Cloud

    Outsourced Bookkeeping Outsourced Accounting For Construction Fast Easy Accounting
    Step #3 P = Production, is the final stage of launching a successful construction firm. This is where all your hard work pays off. At this point you have the operation manuals in place for your field and office employees; the document that answers the same questions you get asked 1,000's of times...the Wikipedia for your company "This is Who We Are And This Is How We Do Things Here".

    ...But wait there's more- At this stage they know exactly who their target market is and they have a word picture of the clients they want to serve so it is a simple matter to assemble all the tools, equipment, employees and setup truck(s) and/or van(s) and go to work!


    Profitable Construction - Companies have known about the value of outsourced bookkeeping services for a long time and now you know about it too!

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    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 Services by accountants who understand construction.

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    About The Author:

    Randal DeHart, PMP, QPA The Construction Accountant 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 and Bill.Com Certified Guru. 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. Follow Randal on Google+

    Topics: Construction, Construction Strategy, Bookkeeping, Bookkeeping Services, Strategic Planning, Construction Accounting, Systems And Processes, MAP vs. PAM, General Contractor, 80 20 Rule

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