Contractor Success Map With Randal Dehart | Contractor Bookkeeping And Accounting Services

This Podcast Is Episode Number 0442, And It Will Be About Understanding Construction Accounting Terms And Why It Matters 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. 1. Cash Flow  Do you have more cash flowing into your business each month than you payout to cover costs and expenses? If so, you

This Podcast Is Episode Number 0441, And It Will Be About Improving Client Relationships With CRM In The Construction Industry   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 thi

This Podcast Is Episode Number 0340, And It Will Be About Inbox Productivity - Email Management For Your Construction Company 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. The problem with email in the construction industry A significant issue with email is that contractors tend to feel that they have to read and respond to every work e

This Podcast Is Episode Number 0339, And It Will Be About 10 Hidden Construction Contract Traps And How To Avoid Them 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.   Before it is too late, consider these traps to look out for: 1. Poorly defined scopes of work create claims and disputes. 2. The completion schedule is too short and exposes you to monetary damages for failure to finish on ti

This Podcast Is Episode Number 0338, And It Will Be About Calculating Costs And The Value Of A Construction Bookkeeper   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.  Just like there are skilled construction workers and clowns trying to pass themselves off as skilled w

This Podcast Is Episode Number 0336, And It Will Be About Practical Procedures To Boost Your Construction Business Profitability Cost is what you see; the profit potential is what you don't see.  High-profit construction company owner's focus on both and understand that "It Takes Money To Make Money."   Strategy comes from the office. Fieldwork is vital - labor, material, and subcontractors get things built, maintained, and repaired; however, efficient operations and fast workers who give 110% cannot overcome lousy strategy. Office and field are separate but equal. Each skill-set requires different working styles and different cultures. It is your profession as the business owner to help everyone come together and understand each other's job and how it fits in the grand scheme of things.   Successful contractors understand how and why the business cycle of construction works through implementing these actionable steps:   Examine all your processes   Take a long hard look at your construction company and lis

This Podcast Is Episode Number 0336, And It Will Be About Top Reasons Why Contractors Have A Hard Time Loaning From The Bank 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. Banks stay in business by loaning money and earning interest. They work hard to find people and companies that have good credit so they can lend money and get paid back in a timely fashion, with all of the interest due to them. Do your best to avoid raising any red flags:   Your Profit & Loss and Balance Sheet Reports do not conform to financial industry standards The financials tell the banker your bookkeeper d

This Podcast Is Episode Number 0335, And It Will Be About The Scientific Remodeling System   Today's Guest Article Is From David Hawke and Randall Soules A real remodeling system designed to generate more wealth with less work. I know it sounds like a cliché, and possibly even far fetched, but in this podcast episode, you’ll hear how this system came to exist and what gives its users the path to more wealth with less work. That said, success is not a guarantee. It does take work, but if you have the desire, the Scientific Remodeling System will give you the systems and processes needed to not only thrive as a remodeler but also have the money and freedom to enjoy a personal life with friends and family. Remodeling contractors are a rare breed. Typically they are tradespeople who make the jump into a business owner. They are very tied to the outcome of each project and love the feeling of giving life to the space they’re working with.  It’s as much an art as it is business. And that is why it’s difficult to

This Podcast Is Episode Number 0334, And It Will Be About How To Make More Money In Construction With SWOT Analysis   Developing a comprehensive strategy for your construction business can be about as much fun as wrestling a pig in the mud because: It is slippery and hard to get control over it. It will wear you out and frustrate you to no end. You will swear it is a complete waste of time. Your contractor buddies who are barely making a living will think you're crazy. In the end, you will be thoroughly worn out, exhausted and mentally drained. What separates wealthy contractors from poor contractors? It's not a lack of opportunities to bid jobs or get leads because getting leads is easy. It's not lack of ambition because every contractor I know is active and ready to get busy. It's not a lack of intelligence or the ability to develop a production method and follow it to the end. It's not lack of money because if you follow my process, you know how to overcome that using O.P.M. (Other People's Money) Th

This Podcast Is Episode Number 0333, And It Will Be About Why High Demand Doesn't Always Equal High Profit In Construction   The business cycle operates like ocean waves that cause a lot of construction business to go out in a year or two. Some grew too fast without reliable financial reporting tools and proper guidance.   As you may know, there is an expansion and contraction Isoquant that occurs in all businesses. For construction companies, it is accelerated because of the enormous risks in project work. The changes in demand for Labor, Material, Other Costs, Subcontractors can occur almost overnight which often causes a financial death spiral, and the contractor does not know they are in trouble before it is too late.   We have discussed time and again that construction accounting is different from regular accounting because of the confusion between Costs of Goods Sold and Expenses, and that is one of the significant issues here. Also billing and invoicing is a bit more complicated because the sales ar

This Podcast Is Episode Number 0332, And It Will Be About What Every Contractor Needs To Know About Payroll Processing   When it comes to paying employees, laws and the IRS, have made the payroll function a time-consuming nightmare for the small business owner.   Small business owners spend an average of eight hours a month performing payroll functions. That's 12 full days a year that could be spent generating sales, prospecting new business opportunities, improving products or services, or servicing customers.   Getting time cards input into QuickBooks and processing payroll can be a big hassle for your construction company.   Employee advances and loans that you forget to deduct can drain away your entire profit. Timecards come in late causing payroll to be under enormous pressure to meet direct deposit deadlines. Tracking employee bonuses, reimbursements and garnishments take time and money and can cost your company some serious fines, penalties, and lost productivity if not handled correctly. Why Outs

This Podcast Is Episode Number 0331, And It Will Be About Build A Construction Accounting System That Works Best For Your Company   Construction is a tough business, and people failure is common. Most of our clients have either failed or come very close. It doesn't matter how many times you are knocked down; it only matters that you learn your lessons, get up, and go again. Some lessons we already took note of years ago, having owned and operated our construction company. By building a system and gaining insight from us, you can pick up from our mistakes which you don't have to go through and can start avoiding before it comes crashing down.    We are deeply passionate and committed in the construction industry that we want to support you, our clients and readers, to achieve your definition of success. Whether you're a contractor, owner, spouse, a business professional, bookkeeper, or accountant; we understand your frustrations because we've been where you are now, and we're here to help.   Introducing

This Podcast Is Episode Number 0330, And It Will Be About Fast And Easy Contractor Networking Profitable contractors attend networking events not because they have nothing better to do; they do it because it pays off. You can either spend hours doing office tasks like bookkeeping or getting face to face with someone who may need your services. Meeting people gives you the chance to build and develop relationships, hire you, or refer you to someone who might. Most of our contractor clients work alone or with a small team, making connections vital and refreshing to meet other professionals doing similar work. Although not every networking event is going to yield a harvest. You might end up learning about all kinds of needs and opportunities about everything under the sun except what you came for - qualified construction leads to support your business. However, this is another path to cultivate and harvest repeatedly. As an example: A home builder learns about a commercial tenant improvement contractor who ne

This Podcast Is Episode Number 0329, And It Will Be About Ways Your Construction Company Can Spend More Now And Save You Money Long-Term During my lifetime, I have seen too many contractors work hard, never have enough money to retire. Some of them die from exhaustion, and others just wore themselves out and lived their final years in poverty and only a few, less than 5% ever made enough money from owning and operating their construction company and outside investments to retire early enough and enjoy a comfortable lifestyle.   This article is a bit strong, and it could offend some folks. If it offends you, please accept my sincere apologies. I tend to tell it straight and not sugar coat anything because I have been involved in the construction industry most of my life beginning with working in my Step Father's construction company after school in the mid-1960s.   In an attempt to save money, the cheap contractor ends up spending the most money and earning a tiny profit because they believe in maximizin

This Podcast Is Episode Number 0328, And It Will Be About 5 Things Your Construction Bookkeeper Wants You To Know If a Contractors Bookkeeping Services System doesn't work and they want it fixed but will not allow any changes, they need a magician, not a construction bookkeeper. Our workflow removes paperwork frustrations only if the contractor is also willing to do their part. It hurts when we have to let a contractor client go elsewhere because we are not able to help them. We sincerely believe we can help all contractors have more freedom, by earning more money, working fewer hours and sleeping better at night by taking the pressure off their bookkeeping so they can focus on financial reports and job costing reports, instead of data entry. In a few rare cases, contractor clients have wanted specific financial and job costing reports, but they flatly refused to allow us to make changes in their contractors bookkeeping services system which would have made it possible. We understand they are operating from

This Podcast Is Episode Number 0327, And It Will Be About Proven Reasons Why Contractors Lose More Money Doing Their Books As a construction or trade contractor, you are highly skilled, intelligent, and adaptable. That is a given because you operate in a multi-faceted changing environment doing the impossible with limited time, money, and resources on every project. Moreover, soon as one is finished, another one is waiting for you.   Many contractors like you feel that hiring a Professional Contractor Bookkeeping Service is a waste of money when you should be able to do it yourself. You press a few keys on your keyboard thinking you are going to get the results you want, accurate bank balances, a report showing who owes you money and who you owe money to, a Profit and Loss Report and Balance Sheet Report you can understand and if all goes well perhaps even some Job Costing Reports. Instead, what you get is a hot steaming pile of fertilizer that cannot even be used in the garden.   The DIY (Do-It-Yourself)

This Podcast Is Episode Number 0326, And It Will Be About Understanding Other Construction Company Costs And Opportunities To Increase Your Profit   Many contractors are having trouble adapting to the new economy. I have made more mistakes – than ten of the average contractors put together. I've learned a great deal of hard, hard lessons, and worked my way through several "Character Building Moments." What I am about to ask you to do is something I have done for many years during my contracting days, and it still works.   Understanding Other Costs:   Marketing Cost   The cost your company spent to acquire and maintain the job. Depending on how you allocate marketing dollars as a percentage of sales or a fixed budget will have an impact on your marketing cost per job. Your cost-per-call, closing ratio, and other related information is all part of your operations, accounting, and bookkeeping reports.   Mobilization Cost    Are the costs you incurred to get a crew to the job site in terms of travel time and veh

This Podcast Is Episode Number 0325, And It Will Be About Construction Company Marketing - Leads, Customers, And Clients It takes work to make the phone ring. It takes even more work to increase the sales ticket. Customers are looking for a contractor to do a little work. If you offer three options, do you find customers usually choose the middle option?    When trying someone new, they may go with a "Low Risk" by prepaying for services on a "Deal" on a contractor lead generation service. The deal allows them to set a "budget." It allows them to try you out before mentioning any additional details. Have you ever heard anything like this from a prospect: "Hello Contractor, I had nothing better to do this week, so I filled out your form and called you on the phone to ask you come to my house and while I act your tour guide because I am thinking of having some work done."? Not likely.   Most homeowners have a real need before asking for a stranger to come to their home. They are looking for any "Affinity" that

This Podcast Is Episode Number 0324, And It Will Be About Effective Strategies For Contractor Timecard Issues Employees need to fill out timecards. The most practical reason is that all employees want to get paid, early, often, and regularly.   For those of you that are parents, do you remember when you brought home your newborn baby? They need food, water and diaper changed. You learned all about "Goldilocks and the Three Bears" Some children who are born on a HOT summer day seem to get "overheated" quickly and do not suffer quietly.    If you have employees, you may notice in some similarities to raising children because in some cases you the contractor take over where your employee's parents left off. They want their paychecks (allowance) on a regular basis, and it had better not bounce at the bank due to insufficient funds.   If any of your construction worker's paychecks do happen to bounce or they are not able to cash it at the bank because your construction company does not have enough money in the pay

This Podcast Is Episode Number 0323, And It Will Be About How To Manage Cash Flow Properly In Your Contracting Company Construction company cash flow is the movement of money in and out of your contracting business; these movements are known in accounting circles as inflow and outflow.    Inflows for your construction company primarily come from the sale of goods or services to your customers, but keep in mind that inflow only occurs when you make a cash sale or collect on receivables. Cash is king! Other examples of cash inflows are borrowed funds, income derived from sales of assets, and investment income from interest.   Outflows for your construction company are generally the result of paying labor, material, other direct and indirect costs of goods sold and overhead expenses.   Is cash flow the same as profit?   While they might seem similar, profit and cash flow are two entirely different concepts, each with entirely different results. The concept of profit is somewhat broad and only looks at income an