(Note: We are tracking the latest construction industry news and online resources for contractors in time of COVID-19)
The success of any business, large or small, depends considerably on nurturing an efficient, productive workplace.
Some contractors and construction company owners believe in maximizing production by driving everyone from the laborers to the Project Managers to work harder, longer, faster, hustle, and run. And if they are giving less than 110% to the company, they are not doing enough.
While improving employee productivity should always be a priority when the ultimate goal is a sustainable and profitable business, the process is easier said than done.
Below are some of the most effective methods of managing a productive, happy workplace while increasing output:
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.
Accounting has two sides:
Internal Accounting (Management Accounting) - for making money. Its purpose is to help you operate and grow your business profitability.
External Accounting (Tax Accounting) - for paying taxes. Its purpose is to prepare tax forms, report your income, and make sure you pay your fair share of taxes.
Understanding the difference will impact your company's financial health and wealth. Both groups of accountants must know the relationship between your internal bookkeeping and the Internal Revenue Service, and the importance of paying the right amount of taxes. There are a lot of professional bookkeepers, accountants, and tax preparers and they all serve a different role in your business.
There is a thread of success weaved into the fabric of the most successful, wealthiest, consistently most profitable house builders, general contractors, residential remodel contractors, flipper house contractors, commercial tenant improvement contractors, sub-contractors, specialty contractors, handyman, architects and designers and over 100 other types of contractors and construction-related companies - they adapt to a continually changing environment.
Everything in the Universe is in balance, and parts of it are easy to see and understand and some parts are hidden in plain sight and require some effort to see and understand. Your ability to look beyond the initial statement and understand the hidden meaning why successful contractors adapt to change to survive and thrive will serve you well. The truth is the most successful, wealthy, highly profitable construction contractors don't like change.Read More
Job Costing, in its simplest terms, links the money you spent on a job against the money you received to do a particular job. It is the process of tracking all the costs related to a project to determine its profitability.
A common misconception is that Job Costing is only for large contractors with a dozen employees. Since keeping track of all costs and expenses involves a lot of additional work for contractors and field workers, and most construction company owners do not see an immediate benefit, some contracting businesses still haven’t implemented Job Costing procedures despite the financial risks.Read More
Our winning strategy talks about Marketing as the foundation, Accounting as the center of your construction business, and Production where the rubber meets the road, or if you please, this is where all the planning and support structure pays off.
Some contractors and construction company owners believe in maximizing production by driving everyone from the laborers to the Project Managers to work harder, longer, faster, hustle and run. And if they are giving less than 110% to the company they are not doing enough. You may have different opinions on this but one thing I've learned from experience is that construction meeting process increases productivity.Read More