GROWING YOUR CONSTRUCTION BUSINESS PREDICTABLY AND PROFITABLY

Construction industry is a fast paced industry. Like many other industries where there are standardized products and services the cost is predictable. In construction the business owners have to bid on jobs without knowing what the outcome of that job would be on the bottom line of the company, in simple terms would that job be adding to the profits of eating away the profits.

Construction business is labor intensive, materials and subcontractors. Slight miscalculation of production cost can change the gross profit for the company dramatically, thereby impacting the net profitability.

If as a business owner you are able to predict:

• How much work you need to get in order to breakeven or make profit
• When is a good time to add employees and purchase equipment
• What the revenue should be for the year
• What your overhead expenses would be 
• What is your target profit
  

Keeping a monthly track of the above metrics and when shared with project managers and employees enhances teamwork because we now know what target we need to hit to achieve a desired margin. On top you can calculate if the dream job everyone was chasing would be the one which adds to the bottom line or turns out to be a disaster.

At CFOforcontractor we help construction businesses working on long term contracts with game changing information. You would now be able to see things like…

• The ability to “game” scenarios to see the different possible futures of your construction business. You’re able to see the real effects of “what if…” scenarios like adding jobs or changing schedules or costs on jobs!
• How much cash you’ll have at the end of the year.
• Your cash flow—that way, you can see where your cash is coming from and where it’s going, helping you to make decisions involving cash (like whether you should get rid of any expenses).
• Key ratios to determine the performance of your construction company.
• How much revenue you’ll earn.
• How much profit you’ll make.
• Your projected overhead expenses.

Most construction business owners bid on high volume projects thinking that the project would be the dream job which would dramatically increase their profits and would change the financial future of the company. What if we told you that you could run scenarios to see what happens if you take it. Would it solve the problem or create more problems? Oftentimes contractors need to fund the initial stage of a big project, doing so without knowing the end result leads to huge unpredictable losses and financial distress. 

How would you like when -

• You can look at different departments and divisions in your company to see how they’re doing and track performance.
• See the projected periods of profit, breakeven, and losses so you can make clear decisions on things like when you need to get jobs to make more revenue or when you need to control expenses.
• See whether you’re going to be collecting cash or whether you’ll need help on your line of credit. That way, you can plan accordingly with your cash.
• See what your working capital is to determine if you have enough money to take jobs.
• See approximately what you’ll need in terms of cash to fund a job—that way, it won’t catch you by surprise and leave you scrambling for cash to fund it.
• See approximately what margin trends are on a job so you know how much profit you’ll make off it.
• The ability to see how much margin you need to make on a job in order to breakeven or profit.
• The ability to easily export and import spreadsheets of your job schedule so you don’t have to manually grind away inputting the data.
• See if you’re building equity and the value of your company. That way, if your plan is to eventually sell it, you’ll know if you’re heading in the right direction by building the value you need to meet your long-term goals.
• Find the best time to add employees or equipment—that way, you won’t be breaking the bank and causing issues while expanding your business.
• See if you’re able to fund a bonus program. Plus, with the data the Atlas Growth Model provides, you’ll be able to show the rest of the team if you’re on track to reach your financial goals so everyone gets a bonus—leading to greatly increased teamwork and cohesion!
• See if you’re able to fund a succession/retirement plan.
• Test different jobs and see what will happen if you take them on—including your big, “dream” job!

Who Will Benefit From This

Commercial Construction Businesses and Home Builders with revenue above 3 MM and jobs that last longer than 6 weeks usually will find the most value

What You Need In-Order To Generate The Information

• Income Statement
• Balance Sheet
• Work In Progress Schedule/Job Schedule

Who Should Hire Us

• Residential and Commercial Construction Businesses who are working on contracts which are long term in nature
• Construction businesses with annual revenue of $ 3million -$ 20 million. 
• Growth focused but have not yet dialed in the financial division of their business. 
• Bookkeepers and accounting staff lack construction accounting knowledge and are unable to produce reports that could drive decisions. 
• Companies looking for training of staff but not able to hire full time construction industry knowledge based CFO/Controller 
• Most of our clients are Custom Home Builders, Remodelers and Commercial Construction Businesses

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