Bookkeeper for Concrete Contractors

Why does cash flow put concrete builders in a bind?

Cash flow is your biggest challenge because you pay for material and crew before the client pays you.

A concrete job usually goes like this: you bid a driveway, order concrete and form material, pay your finishers by the end of the week, and then you invoice only when the job is concrete sets and is done. On top of that, many owners hold a retainage amount until the customer signs off, so a big part of that invoice can sit unpaid for weeks. The translator that your bank account has to rise and stay ahead of your next job before the previous one clears. A clear set of books shows you how much working cash you need to cover the gap, so you don't have to turn down jobs that you could handle if you had better forecasting.

How do you know if a job was priced right?

The only way to know for sure is to compare what the job actually cost you against what the invoice you sent, and do that for every job.

Owners across the trade say they've come under more pressure in the last couple of years to drop their bids to win work. That squeeze is tougher when you don't know minute by minute what a particular driveway or pad costs you. If you don't take inventory of your materials, labor, and equipment very job, you are bidding without your full cost picture, and it's easy to end up with a busy job that eats into its own profit. The fix is job costing, and it does not check the final number on the invoice.

• Keep the material cost assigned to that specific job, not to a general material bucket.
• Clean your labor hours to the job they did the hour at a time.
• If you bring in a pump, a mixer, or an extra helper, that cost belongs to that job too.

Which costs do you need to track separately?

You have to separate direct job costs from your overhead, because they answer different questions.

Direct job costs are the concrete, the rebar, the finisher's badge, the form lumber, and any travel rental you have on a given site. These touch a single job. Overhead is the cost of standing up your business every month - insurance, your truck payment, office, license, and the like. Those costs exist even when you only have one crew running. When you bookkeeping mixes them together, you can't tell if a big job carried the month, or just covered your overhead alone. The lines need to stay separate so you can make decisions like whether to add a crew, replace that old mixer, or take on another one out of town.

How do you track the cost of one job?

Give every concrete job its own account in your bookkeeping system.

Start with the bid, push labor hours to the job card, log every concrete order on that job, add on rebar or mesh, and value any equipment rental or your trip. That's four or five numbers you can't get from a bank feed alone. This takes an extra step at the time you book it, but it gives you a clean answer on which driveway or pad actually pulled its weight. Without it you end up with just a pile of materials that don't tell you where money went, and you win bids you should have walked away from.

How do you separate owner pay from profit?

You need to track what you pay yourself separately from the profit the business earns.

If you work on the crew and take a draw instead of a set wage, that draw is not a business expense like wages for an employee. It is money you take from the business as its owner. When you mix it into the operating costs, you can fool yourself into thinking the business is losing when it is actually distributing your earning. You also see the tax difference. A salary passes through on different lines, so you want to know what is paid to you as receipts versus what actually is profit you can reinvest. Separating these lines in the books lets you ask a basic question: can this business run and pay you eighty thousand dollars, or are you just leaving it on the job?

What monthly reports should you look at?

Two reports make the difference: a job profitability report and a cash flow statement.

The job profitability report summarizes each job's total income along with its job costs and shows the net profit or loss on behalf of job. That answer to "Which jobs do I want to go after next time?" The cash flow statement shows your money coming in and going out on a timeline, so you can see if you have enough to run payroll or order material before the next check lands. Together they let you put schedule that next commercial pad and know if you break your cash is wide enough. Monthly is well enough, your daily bank feed does not tell what to amend.