Job Costing for a Roofing Company
Accounting for the many expenses of the job.
Why would a roofing company need job costing? The short answer is: Materials. Lots of materials.
Construction is a very high risk industry because costs can easily get out of control if you don't have the tools to track them. I mean, even a small home improvement can become a big project. Most people have had to learn Rule of Three, which is that every small project will require at least 3 trips to Home Depot. That's because life happens. We can't predict everything. Oftentimes we need to make adjustments, and that means additional costs.
Now consider how much more significant the costs are for a roofing job. You need to plan much more carefully in order to keep your business profitable. You've got bills to pay, and you've also got employees depending on a paycheck.
So what kind of expenses does a roofing company have?
This isn't a comprehensive list, but you get the idea. There's a lot to manage, and you need a tool to track it all. That tool is job costing software.
Using a reliable job costing program can give you peace of mind. You can check on your profit all throughout the job. Without a good accounting application, you won't be able to calculate your profit until the job is done. That leaves you a lot of time to worry about making payroll.
Of course you'll want to start with the basics of accounting: General Ledger, Accounts Receivable, Accounts Payable, and Payroll.
Integrating with your estimating program would be critical, because you'll save all sorts of time. You'd want to be able to convert your estimate into a budget. That budget will become the standard that all costs are compared against.
Excellent reporting is also a must. What's the point of having all that great info if you can't find it. You need to be able to access that information, and get it in the format you want. Having job cost reports available allows all the project stakeholders to stay updated. None of them wants a surprise.
Change orders are an inevitable part of construction work. People change their minds, and with those changes come changes to your expenses. Most people find change orders to be a time consuming task. Good software should be able to streamline this for you. It should also update your budget so you're working with accurate information.
There's a big variety of options out there, and some of them require $15,0000 worth of training to get your staff up to speed. At A-Systems, we like to make things easy on you. The program is simple to learn, compared to many of your other choices. We do offer training as well, and it only takes a fraction of the time and cost of others. If you're more of a self-taught learner, you can view our online video demos to see all the main functions of the software. It's basically a free training.
Some smaller contractors prefer to use spreadsheets, or even paper. Hey, if it's working for you, nobody can say it's wrong. However, most people find more efficiency and accuracy when using a full accounting program. There is definitely some work to do the research and choose a new system. Then there's some learning curve, but most people are much happier with the outcome.
One of the many benefits of using a true accounting program that's built for construction companies is organization. It's so much easier to find your data and prepare reports for any interested party. This makes collaboration easier, because with a few clicks you can make a report and email it.
Scale is another thing to consider. If your company went through a period of rapid growth, would you want to keep doing the accounting by hand? Would you be able to focus on your job better if you had an accountant using A-Systems JobView?
Feel free to look through our features, try a free trial, or get a guided tour. We're here to help you succeed. Give us a call at 800-365-6790. We'd love to talk to you.