Cash flow and bad bookkeepers are the #1, and #2 reasons construction companies go out of business. 
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    Four Things To Consider Before Expanding Your Service Offerings

    Posted by Sharie DeHart on Fri, Oct 15, 2021

    If you're looking to grow your construction business, you might consider expanding your service offerings. Adding additional services is an excellent way to increase your profitability, diversify your income and expand your market. But there are essential things to consider before adding to your income streams.
     
    First things first - find the money. If you don't have savings earmarked to fund your ideas, you'll want to make sure your "scaling my construction business" plan includes adequate financial planning. Applying to a lender for a business loan is one option. In this case, you'll want to include up-to-date cash flow reports, income statements, budgets, and projections in your plan for a potential lender.
     
    If your construction business doesn't have a credit history, you may need to look at other options for financing your plans. Using a business credit card regularly and paying off the balance can help you build a good credit rating, which will help you prepare to apply for a loan down the road.
     
    Read More

    Topics: The Contractors Account, Construction Bookkeeping And Accounting, Systems And Processes, Business Planning For contractors, Contractor Tips, finance

    The Advantages Of Healthy Competition For Your Contracting Business

    Posted by Sharie DeHart on Fri, Sep 10, 2021

    Starting a construction business means you'll compete with other companies that already exist. It's a good thing if you have a competition to go up against. Competition pushes you to be innovative. It also means there's an established community for your services.
     
    What about if you're considered a veteran at this stage? Understand that you cannot outwork your competition forever because you will grow old and tired in time, and there will always be someone else who is newer, younger, and works cheaper than you can.
     
    Being aware and mindful of what others in your industry have developed and provided leads to a newfound motivation and belief in making an impactful difference, whether within your company or your community.
     
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    Topics: The Contractors Account, Construction Bookkeeping And Accounting, Systems And Processes, Business Planning For contractors, Contractor Tips, finance

    How To Build An Effective Financial Plan For Your Construction Business

    Posted by Sharie DeHart on Fri, Aug 06, 2021

    Every business needs a financial plan. Your financial plan gives you a way to monitor and review your cash flow, make adjustments to your spending, and anticipate any upcoming economic issues. It can also make you more prepared to request funding or find investors so you can bring more money into your construction business.
     
    Although many business owners are aware that financial planning is essential, it is often overlooked. Without a financial plan, however, you could find your business doesn't make the money you expected it to—or you could wind up with unanticipated expenses and no way of paying for them.
     
    If you are a contractor, you are most likely a "doer," someone who gets things done, not now but right now! When you see anyone not swinging a hammer, drilling holes, pouring concrete, laying carpet, putting paint on the walls, or a thousand other construction tasks, the first thing you think is they are wasting time and money, and you want no part of that nonsense!
     
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    Topics: The Contractors Account, Construction Bookkeeping And Accounting, Systems And Processes, Business Planning For contractors, Contractor Tips, finance

    Contractors Need KPI Not Get-Me-By

    Posted by Sharie DeHart on Fri, Oct 23, 2020

    Being in your own business can be the best time in your life. Alternatively, the worst time! No one starts a business, especially a contracting business, and have it rolling perfectly with a profit every step of the way. Between regulations, economic uncertainty, and other outside forces; always a learning curve.

    Picking a Get-Me-By Contractor's Bookkeeping Solution in many cases is using an Excel Spreadsheet and a shoebox, file folders all dumped into a file box and looking at the Online Banking once in a while. This accounting method is the "I still got money, so I must be okay."

    When you use today's Job Deposit To Pay For the material, labor, and subcontractors from the last job, it is also known as "Rob Peter To Pay Paul." Cash flow is never a problem until the sales stop; then it doesn't matter if it is the economy (your customers get laid off), domino effect (their customer didn't pay them), or you are unable to work due to being hurt on the job or get sick (flu or more serious illness).
     
    Read More

    Topics: QuickBooks Construction Reports, Key Performance Indicators, KPI, QuickBooks Construction Accounting, Contractor, finance

    The Value Of Unique QuickBooks Reports Specific For Contractors

    Posted by Sharie DeHart on Fri, Jul 31, 2020

    Some applications make almost everything easy, including accounting software. Too many contractors find out too late the adage "You get what you pay for" still applies.
     
    Hundreds of contractors and regular bookkeepers have told us how simple QuickBooks is to use, yet they cannot understand why QuickBooks for Contractors is so hard to use, and it is getting harder every year. I agree with them.
     
    Making a lot of money as a contractor is easy if you know what to do, and I don't mean your ability to produce more fieldwork than anyone else, although that does help.
     
    Each contractor type has unique construction accounting needs, which means if the QuickBooks process is custom-fitted to each construction company's needs, it is a beautiful thing.
     
    Read More

    Topics: QuickBooks Construction Reports, Profit And Loss Reports, QuickBooks Construction Accounting, Contractor, finance

    Brace Your Construction Business From Recession

    Posted by Sharie DeHart on Fri, Jul 17, 2020

    The pains caused by an economic downturn can be excruciating, which is why most of us dread it.

    A recession can mean massive layoffs, jobs becoming harder to find, and wages frozen, which means consumers hunker down and spend less-- often worsening the slowdown unknowingly. 

    For most businesses, especially small businesses, recessions can be brutal. Just take, for example, the Global Financial Crisis (GFC) that struck the world in 2008. Between December 2008 and December 2010, approximately 1.8 million small businesses shut down. When Investopedia looked into the financial crisis's impact on small businesses after a decade, they found out that business creation has not yet returned to pre-crisis levels. 

    Read More

    Topics: Be Do Have, Cash Flow, Construction Marketing, Business Plan For Your Construction Company, Contractor, Contractor Tips, finance, Construction Business After COVID-19

    What To Do If Your Construction Business Is Operating At A Loss

    Posted by Sharie DeHart on Fri, Jul 10, 2020

    Operating at a loss means you’re spending more money than you’re making. And while it’s not uncommon, especially for new businesses, it’s still not an ideal situation and shouldn’t continue in the long term. Otherwise, you will eventually run out of cash reserves and be out of business.

    So the first thing you need to identify is why you’re operating at a loss. If it’s because you’re still in the start-up phase, then you might not need to worry too much as long as you’ve got enough cash to meet your costs. But if the losses are due to a decline in sales, then it’s time to review your construction business and, if necessary, get professional help.

    Read More

    Topics: Profit And Loss Reports, Construction Marketing, Contractor, Contractor Tips, finance, Contractor Operating Tips

    Why Track The Construction Company Owner's Time On Jobs

    Posted by Sharie DeHart on Tue, Oct 15, 2019

    As a construction company owner, you are getting paid, paying someone, or both. Contracting is all about money and taxes. With your job being not only physically demanding but also mentally draining, have you considered valuing your efforts? I understand how challenging it is for you to keep tabs on your employee's schedule, but make sure you also track yours.
     
    The primary reason to track Owner's Time On Jobs is to have a more accurate Job Costing Reports. You need to know how much money each job is making or losing. As an employer, you need to adopt the use of a time tracking software to assure accountability and improve productivity in the workplace.
    Read More

    Topics: Payroll Processing, Contractor Challenges, Contractor, Contractor Tips, finance, Contractor Operating Tips, Payroll For Construction Contractors

    Top Reasons Why Contractors Have A Hard Time Loaning From The Bank

    Posted by Randal DeHart on Fri, Oct 11, 2019

    Contractors want money; banks want to lend money, what's the problem?
     
    Think of all the times:
    • You loaned money to a friend or relative
    • Provided labor and material for somebody's home or business without a deposit check
    • Did change order work that you never got paid for doing and never will
    • Gave employees an advance on their paycheck that you never got paid back

    Multiply that by 100,000, and you will begin to understand why banks seem so tight-fisted about loaning money.
     

    Read More

    Topics: Contractor Challenges, Contractor, Contractor Tips, finance, Banking

    The Secret To Winning Bids And Getting The Best Projects

    Posted by Randal DeHart on Tue, Oct 01, 2019

    Contractors have often told us that they're "one job away from making it big or losing everything". Our clients usually wonder why some of their competitors appear to be making a lot of money than they do when they seem to be doing similar work. 
     
    Not everyone seems to realize that in construction, money is not made in the field by working and pushing boundaries of tactical efforts - working harder and faster. Money is made in the office developing and implementing strategy.
     
    For example, a backhoe takes longer and more skill to mobilize and demobilize on and off a job site than a shovel. Tactics mean using a shovel for all earth-moving projects. Strategy means knowing when to use a backhoe and when to use a shovel.
    Read More

    Topics: Key Performance Indicators, KPI, Contractor Challenges, Contractor, Contractor Tips, finance

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