Month: January 2013

What is a Reasonable Profit in Construction?

For any company, profit is based on the risk reward concept.  So in construction, what should be the profit (reward) given the risk?  What is a reasonable expectation given the industry and the particular business?  There is no single correct answer.  The construction industry is divided into several significant branches.  This article is focused on...

This content is for Bronze, Silver, One-Time and Contractor's Diagnostic members only.
Log In Register

Methods to Reduce Costs in New Home Construction

This article describes methods to reduce the overall cost of construction for a new home.  The new home construction industry has been hit hard by the devaluing of real estate during the four year period of 2008 to 2012.  There is no reliable source indicating any increase in real estate market value for the foreseeable...

This content is for Bronze, Silver, One-Time and Contractor's Diagnostic members only.
Log In Register

Capitalizing a New Home Builder Business

Bankrolling any startup business is difficult enough.  Capitalizing a new home builder operation is a leap forward in required funds.  Typically, small businesses can be capitalized on a shoestring budget, for a new home contractor, just a little bit isn’t going to work.  Most lending institutions require that the project is funded to the tune...

This content is for Bronze, Silver, One-Time and Contractor's Diagnostic members only.
Log In Register

How to Read a Balance Sheet – Equity Section (Simple Format)

The equity section of the balance sheet equals assets minus liabilities.  Traditionally the equity section is referred to as the net worth of the company.  If you were to dispose of all the assets through a sale and pay off liabilities, the money left over would be available for distribution to the shareholders.  The shareholders …

How to Read a Balance Sheet – Equity Section (Simple Format) Read More »

The 1099 Subcontractor

The Internal Revenue Service promulgates rules and regulations concerning the employment status of workers.  In general, workers are classed as W-2 employees and certain tests must be met to have the worker classed as a 1099 subcontractor.  All 1099 subcontractors should be issued a Form 1099 in January of each year for the prior calendar...

This content is for Bronze, Silver and One-Time members only.
Log In Register

Business and Industry Growth

The second most weighted factor in the risk multiplier series for the Discretionary Income Multiplier Formula is business and industry growth.  This factor evaluates the overall change in an industry and in particular the business under review over the most recent three years.  As a small business owner, you need to understand the importance and...

This content is for Bronze, Silver and One-Time members only.
Log In Register

What is a ‘Spec’ House?

When a builder constructs a house without a contract, it is known as a spec house or a speculation home.  There are several advantages to the builder to build a spec house including timing, financial gains and workforce retention.  There are advantages to the buyer to purchase a spec house as well.  These include no...

This content is for Bronze, Silver, One-Time and Contractor's Diagnostic members only.
Log In Register

Construction Draw Schedule

A construction draw schedule is a financial tool used by contractors in identifying percentage of completion points in the project for the bank to advance proceeds to the contractor. The construction draw schedule is instrumental in keeping the project moving along.  Without good points in the schedule to draw funds, the contractor can run out...

This content is for Bronze, Silver, One-Time and Contractor's Diagnostic members only.
Log In Register

Small Business Model Series Entry #7 – Location, Location, Location

The e-mails keep coming.  A few days ago I asked my friends and family to be on the lookout for ATM’s.  I describe the difference between a bank owned ATM and an independent ATM.  I was strictly interested in the independents.  I wanted to know exactly where the ATM is located, the name of the …

Small Business Model Series Entry #7 – Location, Location, Location Read More »

Facebook
Google+
https://businessecon.org/2013/01">
Twitter
LinkedIn