Construction

As an owner of a construction company, your profits should average 9.4 percent per year after taxes. If you are one of the trades, your net profit needs to be at least 11% just to be at the 50th percentile bracket. This profit is net of your personal salary of $170,000 to $220,000 per year. Therefore, if you are contracting around $3.2 million per year, you should be generating no less than $500,000 per year in take home compensation for your efforts. If not, you are not in the upper half of performance within the construction industry. To get there, you need to change your operations. This section of the website is designed to educate you about the proper organization, systems, policies and procedures you must incorporate in your construction company’s culture.

During my thirty years of experience, I have witnessed first-hand how contractors were able to achieve as much as a 19% NET BOTTOM LINE. The key is to have a program of monitoring key performance indicators. This feedback loop allows the owner(s) to discover potential issues before they get out of control. When you achieve this level of performance, cash flow no longer becomes an issue. Results ease your mind and greatly improve your lifestyle and the family’s security. 

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If you want profits greater than 9%, you have two possible solutions. One, you could read all the articles and spend enormous amounts of resources to implement the changes in your company OR two, engage my services to help you get there faster and begin seeing results.

My services include:

• Evaluate your current situation and gain an understanding of your goals;
• Develop a plan to modify your field and office operations;
• Create and assist with a marketing plan;
• Standardize estimating and proposal submittals;
• Modify the existing office operations to properly gather information and compile the data including job costing;
• Organize files/standard operating procedures;
• Facilitate management team meetings to create a feedback loop for continuous improvement. 

This typically takes about three months from start to finish to achieve. Most of the work is done by your team members; I act as a facilitator and counselor throughout the process. 

This section of the website is solely dedicated to contractors. There are over 70 articles covering key aspects of operations and accounting in the construction industry. There is a wealth of knowledge available here. All of the articles are written to help the contractor discover how to improve the bottom line and achieve financial success in this industry. Good modeling measurement tools are taught here; use them to increase overall performance and ultimately the bottom line. Use my experience and learn from my errors and successes to improve your business operation. 

The most common underlying issue between the successful contractors and those barely sustaining operations is a credible estimating program. A well designed estimating program is the absolute best internal control to ensure profitability.

I spent 28 years learning about construction accounting and implementing systems and processes for over 30 different construction companies. I have spent almost 4,000 hours of time drafting, reviewing and publishing these informative articles. The articles below are business related, they are in-depth and educational in nature. The primary goal of each article is to educate and provide insight, guidance and knowledge to the contractor.

If you need help, I’m here to assist you. I have deep knowledge about how to set up cost accounting (project accounting) and tie it to financial accounting. Allow me to identify your needs and render solutions. The changes will greatly impact your bottom line and reduce your stress from the increases with cash flow. Contact me dhoare@comcast.net; I usually respond within a few hours. My rates are reasonable and I’m very responsive.

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