Remove Construction Remove Overhead Remove Profitability
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The Power Of Accurate Job Costing In Your Construction Business

Contractor Bookkeeping

Have you ever wondered how successful construction companies accurately price custom projects? For small business owners like you, understanding this process could be the key to increasing your profitability and ensuring that every job is priced right. The secret is in a method called Job Costing.

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How to Keep Your Profit Wheel Spinning

Construction Business Owner

1 challenge many contractors face is profit shrinkage or profit margin fade. This recurring problem appears when final construction job cost comes in higher than the bid or contract project budget. I often hear company owners say that they bid using a 15-percent markup for overhead and 10 percent for profit.

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A Deep Dive Into Gross Profit Margin For Construction Contractors

Contractor Bookkeeping

Understanding and managing your gross profit margin is crucial to ensuring the sustainability and profitability of your business as a construction contractor. Profit is the money left in your business after all your expenses have been paid.

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How to Make Changes & Still Make Money

Construction Business Owner

It’s nearly impossible to make any money when contracts allow just 10% and your subcontract only allows for 15% total overhead and profit markup on change orders, or time and material costs plus work. The typical commercial contractor’s annual overhead and profit markup look much like those in Figure 1.

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Common COGS Misconceptions Related To Construction

Contractor Bookkeeping

But what does it really mean, and why is it crucial for your construction business's success? Understanding COGS isn't just about accountingit's about making smart decisions for profitability, pricing, and more. These include materials, labor hours, and even manufacturing overheads. What is the Cost of Goods Sold (COGS)?

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6 Numbers You Need to Know

Construction Business Owner

To build a profitable construction business, owners must be focused on key performance indicators (KPIs) and bottom-line numbers. These KPIs are centered on sales revenue, overhead, profit markup, labor costs per unit of work, and your updated job cost labor for every project. 6 Numbers You Need to Know.

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What to Include in Your Overhead Markup

Construction Business Owner

The key to being profitable is understanding ?your your job costs.

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