Surety Bonds · Bid Bond · Performance Bond · Payment Bond · Construction Bonding
Surety Bonds · Bid Bond · Performance Bond · Payment Bond · Bonding Capacity
Construction Surety
Bonds Explained.
Bonding requirements are a fact of life in commercial construction — particularly on public projects and larger private commercial jobs. Most subcontractors know they need bonds but don't fully understand what each type covers, what it costs their business, and how bonding capacity directly limits how much work they can take on. Here's the complete explanation.
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SPM vs. Other CFO Firms
Most CFO Firms Serving This Trade
- High revenue minimums — most won't serve under $5M
- Advisory only — no bookkeeping, no implementation
- No job costing setup or ControlQore management
- No monthly WIP as standard deliverable
- No pricing published — discovery call required
- No vetted partner network for bonding, lending, or liens
- No prevailing wage specialty
The Construction CFO — SPM
- Serves $1M–$12M — starts at $1,900/month
- Full implementation — bookkeeping, job costing, CFO advisory
- ControlQore setup and managed for you every month
- Monthly WIP standard in Executive tier
- Full pricing published — no discovery call to find out costs
- Vetted partners for bonding, lending, lien services, payroll
- Prevailing wage and Davis-Bacon specialty
What We See in This Business
01
You're Losing Work Because You Can't Get Bonded
A GC requires a performance and payment bond for a project you want to win. You call your agent and find out either you don't have a bonding program established or your aggregate capacity is maxed out. The opportunity passes to a bonded competitor. Most subcontractors don't build their bonding program proactively — they discover the limitation when they need it.
02
You Don't Know What Your Aggregate Bonding Limit Is
Your surety sets both a single-job limit and an aggregate bonded work limit — the maximum total value of all bonded contracts you can have outstanding simultaneously. Most subcontractors don't know either number until they're applying for a specific bond. By then there may be no time to improve the financial ratios that drive those limits.
03
Your Financials Aren't Formatted for Surety Review
Sureties evaluate working capital, current ratio, equity position, WIP schedule, and backlog. Most subcontractors submit tax returns or informally prepared financial statements to their surety — not the construction-specific financial package that sureties actually need to evaluate bonding capacity accurately.
How SPM Fixes It
The Three Bond Types Every Subcontractor Needs to Know
Bid bond: guarantees you'll execute the contract at your bid price if selected. Typically 5–10% of bid amount. Performance bond: guarantees you'll complete the project according to the contract terms. Typically 100% of contract value. Payment bond: guarantees you'll pay your suppliers and sub-subcontractors. Also typically 100% of contract value. Performance and payment bonds are almost always issued together. Bid bonds are issued separately at bid time.
How Bonding Capacity Is Calculated
Sureties use working capital as the primary driver — typically allowing $10–$15 of aggregate bonded work per $1 of working capital. A contractor with $500K of working capital typically supports $5M–$7.5M in aggregate bonded work. Growing your bonding program requires growing working capital — which means retaining earnings rather than distributing them. SPM manages working capital with bonding capacity goals in mind for all clients.
Bonding-Ready Financial Presentation
SPM maintains the financial package sureties need — clean financial statements, monthly WIP reconciled to the balance sheet, AR aging, and backlog summary — year-round for all clients. When a bonding application requires financial documentation, it's ready immediately. Executive clients also get strategic guidance on the working capital trajectory needed to support their bonding program growth goals. See our full guide on construction bonding capacity.
Service Tiers
Tier 01
Core Financial
Starts at $1,900 / month
- ControlQore setup and management
- Job costing aligned to your estimate structure
- Cost-to-complete tracking — updated monthly
- Full-service bookkeeping — minimum 30 min/week
- Vendor payments via ACH (you approve, we initiate)
- Accounts receivable management
- Bank reconciliations and transaction matching
- Controllership
- 1 monthly CFO meeting
- 60-day onboarding — books migrated to last taxable year
Most Popular
Tier 02
Executive Financial
Starts at $2,900 / month
- Everything in Core Financial
- Monthly WIP schedule — delivered every month, standard
- 13-week cash flow forecasting
- CEO Report — monthly financial dashboard
- 3 CFO advisory meetings per month
- Strategic accountability and actionable to-dos
- Direct access to Josh Luebker
Pricing by Revenue
Revenue Range
(Last 12 Months) |
Core Financial
Monthly |
Executive Financial
Monthly |
| Under $1M | $1,900 | $2,900 |
| $1M – $3M | $2,600 | $3,600 |
| $4M – $6M | $3,800 | $5,500 |
| $7M – $9M | $5,100 | $6,900 |
| $10M – $12M | $6,100 | $8,500 |
| $13M+ | Quoted | Quoted |
Vetted Partner Network
National Lien Services
When AR gets too long, we connect you directly to our lien services partner to protect what you've earned.
Additional cost — not included in monthly fee
Payroll Integration Partners
Prevailing wage and regular payroll software partners integrated directly with ControlQore job costing.
Additional cost — not included in monthly fee
Bonding Partners
Surety relationships and bonding capacity support. We prepare the financials — our partners get you bonded.
Additional cost — not included in monthly fee
Lending Partners
Working capital lines and equipment financing through vetted lenders who understand construction.
Additional cost — not included in monthly fee
Reviewed Financials
CPA-level financial statement reviews for banking, bonding, and large contract requirements.
Additional cost — not included in monthly fee
CPA Coordination
We work alongside your existing CPA — not replacing them. Clean books and job costing make tax time easier.
Included — no extra cost
Common Questions
Straight answers.
How much does a surety bond cost?
Bond premiums for performance and payment bonds typically run 0.5–3% of the bond amount depending on the contractor's financial strength, bonding history, and the surety's assessment of project risk. A contractor with clean financials, strong working capital, and an established surety relationship typically pays 0.5–1.5%. A contractor with weaker financials or a shorter track record pays 2–3%.
Do I need bonds on private commercial projects?
Not always — bonds on private commercial projects are at the GC's or owner's discretion. Public projects — federal, state, municipal — typically require bonds by law (Miller Act for federal, state equivalents for state and local projects). Large private owners — institutional, healthcare, higher education — often require bonds regardless of legal requirement. The bonding requirement should be identified before bidding.
What's included in Core Financial?
ControlQore setup, job costing aligned to your estimates, cost-to-complete tracking, full bookkeeping (minimum 30 min/week), ACH vendor payments (you approve, we initiate), AR management, bank reconciliations, transaction matching, controllership, and 1 monthly CFO meeting. Starts at $1,900/month.
What does Executive Financial add?
Everything in Core plus monthly WIP schedule, 13-week cash flow forecasting, CEO Report, and 3 CFO advisory meetings per month. Starts at $2,900/month. WIP, cash flow forecasting, and the CEO Report are Executive tier only.
Do you handle payroll?
No. We have vetted payroll software partners — including prevailing wage integrations — that connect directly with ControlQore. Those are separate engagements at additional cost.
How long does onboarding take?
60 days. We migrate your books to the start of your last taxable year, set up ControlQore, and build your job costing structure. Fully operational in two months.
What software do clients use?
ControlQore. All SPM clients run on ControlQore for job costing and WIP. We set it up and manage it — you don't have to learn it. Clients switching from QuickBooks, Sage, or other platforms migrate during onboarding.
Do you work alongside our CPA?
Yes. We work alongside your existing CPA — not replacing them. Clean books and accurate job costing make their job easier at tax time.
What happens when we grow past $12M?
We have a clear graduation path. We prepare your financials, systems, and team for the transition and connect you with the right firm for your next stage of growth.