THE SUBCONTRACTOR P&L EXPLAINED.
A profit and loss statement shows whether the work made money over a period of time. For a subcontractor the lines that count are revenue, direct job cost, gross profit, overhead, and net profit. The trap is reading the P&L without job costing behind it, because a healthy company-wide number can conceal jobs that are losing money.
The P&L answers one question well and one question not at all. It tells you whether the business made money over a month, a quarter, or a year. It can't tell you which jobs produced that money and which ones lost it, and that hole is where subcontractors get fooled. A statement showing 8% net can conceal one winning job covering for two losers, and nothing on the report tells you which is which. Read next to job costing and a WIP schedule, the P&L is powerful. Read by itself, it's a comforting average.
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WHAT IT MEANS.
A profit and loss statement is a summary of revenue, costs, and expenses over a period of time, ending in net profit.
The P&L covers a span of time. The balance sheet is a snapshot at a single point in time, so the two answer different questions and an owner needs both in front of him. What the P&L won't do is tell you where the profit came from, because it rolls every job into one set of totals. That's why the P&L is the start of the analysis and not the end of it.
WHERE IT FOOLS YOU.
It averages every job into one total
The P&L rolls every job into one set of totals. A company-wide 8% net can be one job at 20% covering two at a loss, and the P&L will never show it. Without job costing underneath, you can't tell a winning job from a losing one, so you keep bidding the losers thinking the business is healthy.
Revenue counts work billed, not cash collected
Revenue is the value of work performed and billed in the period. It's recognized when it's earned and not when it's paid, which is why a profitable P&L can come with an empty bank account. The report is telling you what the work earned and nothing at all about the bank.
Overhead can reduce a fine gross margin
Overhead is everything it takes to keep the business open when you aren't building: the office, the software, the insurance, the estimating team, and the owner. Gross profit minus overhead is net profit, and net profit is the only number that says the business works. A subcontractor can hold a fine gross margin and still net near zero if overhead is unmanaged.
WHAT IT LOOKS LIKE IN DOLLARS.
A company-wide 8% net can be one job at 20% covering two at a loss. Revenue is the multiplier on whatever margin you have: at a 10% net it turns $1M into $100K of profit, and at a loss it just speeds up the damage. Growing revenue on an unknown margin is the fastest way to make a small problem a large one.
For most subs a healthy gross margin is in the low to mid twenties. Gross margin is what has to cover all overhead before anything becomes net profit, so a sub under that range is asking overhead to come out of a thinner slice every month. Overhead doesn't shrink to fit the margin you brought home.
HOW THE P&L GETS HONEST.
The job costing structure gets built to match the way you estimate, so every dollar of cost posts to the job and the phase that earned it. The company-wide total then breaks into job level detail: which jobs made money, which ones lost it, and why. That's the difference between knowing the business made money and knowing how it made money.
The P&L tells you whether the work made money. Job costing tells you which work did it. The balance sheet tells you whether the business is sound. All three get produced and reviewed together each month, because the P&L is the one report that's most dangerous to read alone.
FLAT MONTHLY FEE. NO SURPRISES.
Three tiers, priced by your trailing twelve month revenue. Which one you're in depends on how much of the work you want off your desk. No hourly billing. No payroll. The one-time onboarding fee is right here in the table.
Built for subs doing $1M to $12M. Above $12.5M we quote.
| Last 12 months revenue | Core | Strategic | Platinum | One-time onboarding |
|---|---|---|---|---|
| Under $1M | $1,900 | $3,100 | $3,300 | $2,500 |
| $1M to $3.5M | $2,600 | $4,100 | $5,300 | $4,500 |
| $3.5M to $6.5M | $3,800 | $5,900 | $8,300 | $6,000 |
| $6.5M to $9.5M | $5,100 | $7,600 | $11,800 | $7,500 |
| $9.5M to $12.5M | $6,100 | $8,900 | $14,900 | $9,000 |
| Above $12.5M | Quoted | Quoted | Quoted | Quoted |
The onboarding fee covers migrating your books back to the start of your last taxable year and getting you fully operational in 60 days. It's billed once, with your first invoice. It's the same for all three tiers, and it moves with your revenue band. Your first month is prorated, and your monthly engagement starts on the first of the first full month.
Just want the setup? Onboarding only is the same onboarding work with no monthly service after it, one time, at the onboarding fee plus $2,000. Start a monthly engagement later and $2,000 counts toward it. It starts at $4,500, and the price for every band is on the pricing page.
The three tier columns are the whole price. Which one fits depends on how much of the work you want off your desk. No payroll. No hidden line items. The onboarding fee is right here in the table.
- Online software only: QuickBooks, Sage, Viewpoint and similar. No VPN or hosted desktop.
- Not in any tier: payroll, pay applications, collections on receivables.
- Pricing valid through 2027.
CFO work. Your own bookkeeper keeps doing the books.
You stop guessing.
You get the CFO work. Job costing built against the way you estimate, a 13 week cash forecast, monthly WIP, and a meeting every month that ends in decisions and never in a report.
Your bookkeeper still does the books.
Core, plus bookkeeping and bank reconciliations, plus job costing and WIP software set up and managed for you. Use your own online accounting software or we supply it, one price.
Every job shows its margin while it is still open.
Everything in Core, plus the bookkeeping and bank reconciliations done for you, and the job costing and WIP software set up, loaded with your cost codes, and managed every month. Use your own online software, or move to ours and we cover it.
A bookkeeper we choose does the books and reconciliations. No payroll.
Strategic, plus a controller who handles payables and receivables the way an in-house controller would. You approve every payment.
You approve, and the money side gets handled.
Everything in Strategic, plus a controller we choose who handles your bills and receivables for you the way an in-house controller would. They call vendors, pay the bills and keep the accounting current. We plan the cash flow first, and you approve every payment because it is your money.
A controller we choose does the payables and receivables. No payroll, no pay applications, no collections.
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