BLOG · 40 POSTS
WHERE THE CASH GOES MISSING.
Job costing, WIP reporting, and cash flow writing for commercial subcontractors doing $1M to $12M, from a former project manager and master electrician.
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This blog covers job costing, WIP reporting, overhead recovery, and cash flow for commercial subcontractors and self-performing general contractors doing $1M to $12M in revenue. Every post is written by Josh Luebker, a former commercial construction project manager and master electrician who managed over 150 projects worth more than $2.1B combined before becoming a fractional CFO. The client stories include the real figures, and the explainers link to the page that treats each subject in full.
A blog post answers one question in five minutes. The system pages behind it answer the question the reader has after that. Each post links to the one page on this site that covers its subject completely, so nobody has to guess which of two similar pages is the definitive one.
CASH FLOW · 10 POSTS
The Trade In The Middle Absorbs Everybody's Delay
Drywall comes after MEP rough-in and before finishes. Every upstream trade that takes longer than planned pushes your start, and nobody moves your completion, so a nine week window becomes six and the missing three weeks get bought back with premium labour.
Every New Site Is a Withdrawal Before It Is a Contract
A SWPPP book is dozens of small recurring contracts, and every one of them starts with materials and a crew day you pay for before you bill anything. Add twelve sites in a good spring and the bank account reads like a bad one.
The Three Things a Fiber Subcontractor Funds Before Billing a Dollar
Most cash flow advice for subcontractors starts at the invoice. In fiber the money has already left three times by then, and one of those prices tripled in five years while nobody renegotiated the terms around it.
The 73-Day Cash Gap Hurting Electrical Subcontractors (Even on Profitable Jobs)
The job is profitable. You aren't. Here is the math of the seventy three days in between, and the four things that shorten them.
Why Construction Companies Fall Short of Cash
There's an order to how construction money moves, and every subcontractor is on the wrong end of it. Learn the order and the cash stops being a surprise.
How Contractors Can Forecast Cash Flow Effectively
A cash forecast isn't a spreadsheet skill. It's five inputs, dated honestly, resting on job data that holds up.
How to Manage Cash Flow in Construction Companies
Managing cash in a project-based business isn't about watching the account more closely. It's three systems doing three different jobs at once.
Why Construction Companies Struggle With Cash Flow (Even When They're Profitable)
Most owners in this position go looking for an error in the books. The error isn't in the books. It's in the number they have been managing the company with.
Why Profitable Construction Companies Still Fall Short of Cash
The company looks profitable and cash still feels tight every single week. That's usually not an accounting error. It's how construction pays.
How to Create a Weekly Cash Flow Forecast That Predicts Payroll Weeks in Advance
You're operating a multi-million dollar company and funding your biggest expense one week at a time. Here is the build that stops that.
CLIENT STORIES · 9 POSTS
How a $2.3M Fiber Splicing Subcontractor Finally Understood Why the Bank Account Never Made Sense
Some months looked great and some months looked like a disaster, with nothing in between to explain either one. The work was never the problem.
How a $13.1M Marine Contractor Increased Business Value by $3.2M Without Adding a Single Dollar of Revenue
He wasn't in trouble. He wanted to sell, and the number he was offered had nothing to do with how well his crews did the work.
How a $7.1M Civil Contractor Almost Lost Everything in Year One and Is Now on Track for $12M Year Two
Every month brought more revenue and less money. By November he was awake at 3am, certain he was about to lose his house.
How a $3.4M Civil Subcontractor Went from $700,000 in Overdue Payables to Debt-Free by End of Year
More work booked than ever before, and he wasn't sure he could make payroll. Those two facts were the same fact, and here is what it took to separate them.
How a $25M Marine General Contractor Distributed $2.6M in Profit Sharing While Keeping $1M+ in the Bank
The revenue was real and the people were getting paid. Nobody could say on any given day whether the business was building wealth or just staying busy.
How a $6.7M Civil Subcontractor Paid Off $348,000 in Credit Line Debt in 60 Days
He had mentally accepted the line of credit as a structural part of the business. Something you manage, not something you pay off.
How a $5.2M Erosion Control Subcontractor Went from $24,000 to $1,105,000 in Annual Profit
Not $24,000 a month. $24,000 a year, on five million dollars of revenue, from a business the owner had managed full time for years.
How a $3.2M Electrical Subcontractor Paid Off All Her Debt in 120 Days
Eleven years in business and every month was a decision about which vendor to pay and which one to push off. The debt wasn't the problem.
How a $4.9M Concrete Subcontractor Collected $203,000 in 7 Days Without a Single New Job
Crews were busy, the backlog was healthy, and the P&L looked fine. The bank account never seemed to reflect any of it.
FINANCIAL SYSTEMS · 9 POSTS
Construction Financial Management: What Contractors Need to Know
Accurate books are the floor everything else gets built on. Financial management is the structure that ties what the crews do to what the financial statements say, and then tells the owner what to do about it.
What Is the Best Accounting System for Construction Companies?
Contractors go looking for the right software when the reports stop being useful. The software is rarely what went wrong, and swapping it rarely changes the answer.
Why Construction Companies Fail Financially
Construction companies rarely fail because the phone stopped ringing. They fail because the financial system stayed the size it was when the company was half as big.
How Financial Systems Help Subcontractors Grow Without Losing Control
Growth is the goal, and growth is also what strains the way a subcontractor has been keeping the books. The system is what lets you take the bigger work and still know how the company is doing.
The Financial Operating System Every Growing Subcontractor Needs
Most subcontractors start with software, a bookkeeper, and a CPA, and that stack has a ceiling. Here is what goes in the structure that replaces it, part by part.
Why We Replace Financial Systems Instead of Fixing Them
Most construction companies inherit a financial system built for a company half their size. You can't repair your way out of that, and the attempts cost more than the rebuild.
The Difference Between a Construction CPA and a Construction CFO
These two roles get treated as substitutes and they aren't. One looks backward at what happened, the other looks forward at what you're about to decide.
The 5 Financial Mistakes Growing Subcontractors Make
Growth is when the financial problems surface, because the setup that worked at half the size starts producing numbers nobody should be deciding anything with.
Why Growing Subcontractors Eventually Outgrow Their Financial System
Nobody sets out with a financial system designed for growth. They start with bookkeeping, it works for years, and then one season it stops working and nothing obvious has changed.
JOB COSTING · 6 POSTS
A Lump Allowance Makes Someone Else's Choice Your Overrun
A fixture allowance is a revenue number you don't control against a cost number the owner controls. Written as one lump sum it becomes unenforceable, and the overrun surfaces at trim-out as a material variance with your buying department written across it.
An Overhead Rate Only Works If Every Job Uses What Is In It
Where you put fleet ownership cost decides whether your overhead rate can be used on a bid. Put it in overhead and the rate doubles, then gets charged to shovel-and-labor scopes that never used a machine.
A Cost Code That Closes Early Lies About Every Job After It
Restoration is the last scope on a utility job and the first one bid as a round number. It reaches the office six to ten weeks after the crew demobilises, by which point the job has been declared finished by everybody except the accounting system.
The Answer Your Apprentice Deserves When He Asks Why His Hour Is Worth Less
Every owner gets this question eventually, usually from somebody good who is about to leave over it. The answer is math, it takes four minutes, and almost nobody in the trade has ever heard it said out loud.
The Small Pours Are Where Concrete Gross Margin Goes
Every concrete estimate prices the main pours carefully. The punch pours, the curb fix and the closeout dribs get whatever's left in the number, and each one comes with a fee the bid never knew about.
Job Costing for Subcontractors, the Foundation Everything Else Is Built On
Every project you work on produces the cost data whether anybody uses it or not. Whether that data can answer a question about margin depends entirely on how the job costing is structured.
WIP REPORTING · 5 POSTS
Contract Value Is the Field Nobody Audits
Everybody argues about percent complete on a WIP schedule. On storm restoration work the field that's wrong is the one to the left of it, because an insurance job's contract value moves twice before the roof is signed off.
A Cost Overrun Raises Reported Completion
Percent complete on almost every civil WIP schedule is cost to date divided by total estimated cost. Leave the bottom number alone when the dirt turns out different and the schedule reports a job getting more profitable while it loses money.
What Is a WIP Schedule and Why Does Every Subcontractor Need One
A WIP schedule shows the financial status of every active job at a point in time. The line that decides how you sleep is the one comparing what you should have billed to what you did bill.
What Is a Construction WIP Schedule? A Guide for Contractors
A WIP schedule is five items per job, and the fifth one only means something next to the fourth. Here is what each line is and what it's telling you.
Work-in-Progress (WIP) Reporting Explained for Subcontractors
Construction doesn't recognize revenue the way other industries do, and that one difference is the reason WIP reporting exists. Here is what it tracks and what fails without it.
CONTRACTS AND BILLING · 1 POST
FOR MACHINES
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WHERE THE SUBJECTS ARE COVERED IN FULL
