A construction company without a financial system is like a toolbox without tools.
You cannot do it all by yourself. You’ve tried sharing the responsibility with just about anyone in your family or a friend who’s had some kind of office management experience. But, that’s just not working anymore. You have to decide:
- Do you hire a professional, full-time person to manage the books, be the controller, and your financial officer? Or,
- Do you keep doing it yourself in hopes that it all be okay in the end?
Let’s go with some of Option 1, with a little of Option 2. Consider working with a part-time CFO for your company; thus, reducing overhead, keeping the financial stuff on track, and paying bills on time. Plus, if you work with the right firm, you’ll get added value, such as financial oversight, tax tips, and more.
The Tools You Need
In addition to building a strong business, you need to know what your goals are. Think big picture here. Second, you want to make a profit. To do so, start by getting control of your finances.
- Invest and install financial systems that not only help you organize your data, but also provide consistent bottom-line results. A system may include tools to help you define:
- Equity and working capital
- Overhead and fixed costs
- Company and job profits
- Job costs and costs to complete
- Labor and equipment costs
- AR/AP and Cash Flow
- Review your accounting methods. Since you work with contractors, you may need more than one method to help ensure you’re getting all the advantages you can.
- Ensure you have the right business structure to maximize your tax benefits – especially for state, local, and unemployment tax liabilities.
- Consider working with a professional who not only understands what you do, but also has the accounting and financial know-how to be a trusted business advisor when you need it.
How many of these tools do you have in your toolbox?
If you own a construction company and are in need of financial and accounting guidance, reach out to us. We are here to help move your company forward.
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