Trade Contractors & Construction Materials Sales and QuickBooks

Trade contractors handle the specialized aspects of construction for other construction companies (e.g., framing, drywall, electrical, plumbing, HVAC, landscaping). They also frequently install specialty products, and if so, often have showrooms, display areas, or retail operations (e.g., kitchen and bath appliances, windows, lighting), and may carry significant inventories (e.g., electrical, plumbing, masonry). Trade contractors may also perform a variety of sales and service activities for non-builder individual clients (e.g., landscaping, HVAC, flooring, audio/video systems).

Because of the unique nature of the services you perform and the products that you purchase, use, and often-times display, to perform your sales and service activities, you are constantly at risk for time and cost over-runs and thin gross profit margins.

To balance those hazards, you need accurate week-to-week job-cost information so that you can:

Track each job’s progress and monitor financial results.
Keep an eye on changes that impact your profit margin.
Be in a position to make informed decisions as a job progresses.

Additionally you may need to develop a system that can help you:

Enter incoming service calls/service orders.
Record service calls and inventory used.
Monitor inventory levels and use taxes due.
Record retail sales and sales taxes due.
Maintain control of Purchasing activities.

The most important benefit of accurate job-cost and overall company financial and profitability information is the ability to shape your own financial future. How?

When you are intimately familiar with your job-cost and company’s financial numbers, you’ll be able to create more accurate estimates and make smarter buying and pricing decisions.

That’s the real way you can truly make a permanent and lasting change in your bottom line!

At a minimum, you probably want to use your accounting system to:

Assign materials, trade contractor, and other production costs to jobs.
Assign payroll and payroll tax cost for direct labor employees to individual jobs.
Track Estimate vs. Actual results (by job stage) for nearly all of their jobs.
Track (and collect on) Change Orders.
Perform a variety of basic accounting functions within an integrated accounting system (e.g., Accounts Payable, Credit Card Entry, Write and Print Checks, Invoicing, monitor Accounts Receivable, 1099s, Basic Estimates, etc.).
Create a variety of financial reports that will provide information to help run your business more profitably.

You may wish to utilize more advanced features such as:

Sales Orders (Work Orders)
Inventory Tracking
Purchase Orders.
Budgeting.
Payroll preparation and related tax filings.
Fixed assets tracking.
Using QuickBooks® to assign fully burdened labor cost to jobs.
Calculating and making Work in Process (capitalized cost of land and development cost) entries.

Additionally, you are probably looking for a system that:

Can be customized to match the specific way that you do business.
Can be managed in-house – often by clerical level employees.
Is reasonably priced, with low or no maintenance fees.

Fortunately, QuickBooks® is an ideal match for most Trade Contractor companies IF Lists are properly structured and IF bookkeeping staff is trained in various specific aspects of construction and trade contractor accounting and reporting.

Lack of knowledge regarding these crucial accounting and business topics causes numerous errors and frustration, and can cost a business literally hundreds of thousands of dollars in lost revenues and excess cost. But we can help you address a majority of the typical concerns faced by Trade Contractors through focused training and, if necessary, by providing additional assistance from qualified accountants and Certified QuickBooks Pro Advisors.

With our various training services we can provide you with essential basics as well as advanced QuickBooks® applications knowledge for land acquisition and land development activities. We bring thousands of hours of hands-on QuickBooks® and construction accounting experience to the table in these subjects.

We will help you discover how to build your QuickBooks® system to provide you with the information that you need to make more informed, and more profitable, operating, estimating, and pricing decisions for your trade contractor company.

We offer one-to-one support and consulting services to clients throughout North America, and industry-specific QuickBooks online training seminars as well.

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