WHICH GC RELATIONSHIPS MAKE MONEY.
A subcontractor who works for several general contractors has a different margin on each relationship. A blended profit and loss reports the average of all of them, and that average describes none of them. When you measure margin per GC, the spread is usually wide. One or two relationships are being paid for by the rest, and they tend to get the same crew hours and estimating time as the ones paying for them. Job margin alone isn't enough. The financing cost of slow payment, the management hours on change orders, and rework are all outside the job cost record. Most contractors find one or two relationships to reprice or release after about six months of data.
This is a reporting failure, and it costs you money. You don't see it because every one of those relationships produces jobs that look acceptable at the gross line. No single job fails, so there's nothing to investigate. To find it you review the work one general contractor at a time, across all their projects.
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WHAT IT MEANS.
GC relationship profitability is your margin for each general contractor, across every job you do with them. It's adjusted for how long they take to pay, how hard their change orders are to collect, and how much rework they cause. Each relationship gets judged on the money it leaves in your business.
Concentration is the other half of the same question. Say your most profitable relationship is also most of your revenue. That's a risk as well as an asset, because losing it could put you out of business. So the review gives you two numbers for each relationship: what it earns, and what it would cost you to lose. If you rank on the first number alone, your book of work is highly profitable until the phone call that ends it.
The review usually ends with a decision to reprice, to change the terms, or to move capacity. Only occasionally do you release the relationship. If a relationship loses money because payment takes too long, you fix it with terms and leave the price alone. If it loses money because their project managers cause rework, that's a different conversation. A relationship that loses money at every level is the one to give back.
WHY THE BLENDED NUMBER CONCEALS IT.
The blended number averages relationships that aren't alike
One profit and loss covering every general contractor reports the middle of a wide spread. Two relationships well above the average and three well below give you a company figure that looks ordinary, so nobody investigates. After that you make every bid decision on your history with the GC and how much backlog you need, without knowing what each relationship returns.
The costs that separate GCs aren't in the job cost record
Four things make one general contractor more expensive to work for than another: payment timing, change order friction, rework, and scope creep. None of the four appears in a gross margin figure. A GC that pays in 90 days and argues every change order can post the same margin as one that pays in 30 and approves in a week. The second one is worth far more to you.
The weakest relationship draws the same capacity as the strongest
You only have so many crew hours, estimating hours and project management hours. Without a per GC number, they go to whoever called first or to whatever fills the backlog. So the relationship that costs you profit gets the same crews and attention as the one that makes it. Nobody chose that. It happens when you don't have the number.
WHAT IT LOOKS LIKE IN DOLLARS.
A verified $4.9M concrete subcontractor priced every job from the last similar job plus a feel for the market. The overhead on its books was less than half of what the trailing twelve months had consumed. Correcting it meant declining work. The next year the company took $1.3M less revenue and made more money than it had at its peak, because the work it declined was the work that had been losing money. $203,000 of aged receivables came in during the first week. The company paid $130,000 of profit sharing for the first time in its history.
Payment timing is a financing cost. Every day a general contractor holds your money is a day you pay for the work yourself. The average GC waits 83 days to be paid, and the subcontractors below them wait longer. Change order friction is the management hours you spend getting approvals that a better GC gives in a week. Rework is margin you spend twice. Scope creep is work you do that the contract never priced. None of the four appears in a gross margin figure, so gross margin alone ranks the relationships wrong.
THE PORTFOLIO REVIEW, EVERY MONTH.
Every job has its GC recorded on it, so the same cost record that reports the job also adds up to the relationship. That gets decided at setup and built into the job costing. Then the rollup comes every month with the close, and nobody assembles a spreadsheet afterward.
Days to pay gets tracked per general contractor and converted into a financing cost at your own borrowing rate. A relationship that pays in 85 days gets a dollar figure. With that figure you can have a terms conversation, because you can tell them what their payment cycle costs you.
Approval times, the share of change orders collected in full, and rework hours all get recorded against the GC as well as the job. After six months you can tell the relationships that are hard work from the ones that are expensive. Those are two different lists.
The review ends in a decision with a date on it, made at the monthly meeting. This relationship gets repriced at the next bid. This one gets a terms conversation. This one loses capacity to a better one. This one gets given back. If everyone agrees and nobody decides, you have the same portfolio next quarter.
THE OUTPUTS, NAMED.
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. We don't bill by the hour, and we don't do payroll. The one-time onboarding fee is 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.
We build your plan every month. Your team does the work.
You get the CFO work: job costing built to match the way you estimate, a 13 week cash forecast, WIP every month, and a monthly meeting that ends with decisions.
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.
We build the plan, track it and adjust it every month.
We only work with trade subcontractors. We know what to look for, and we fix problems while they're still small. 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 pay for it.
Our team does the bookkeeping and the reconciliations. We don't do payroll.
Strategic, plus a controller who handles payables and receivables the way an in-house controller would. You approve every payment.
We manage the money side for you, every week.
Everything in Strategic, plus our team does the controller work. We handle your bills and receivables the way an in-house controller would: we 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.
Our team does the payables and receivables. We don't do payroll, pay applications or collections.
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