How to Stop Stressing About Cash Flow on Every Job (Part 2)

Most contractors live in a state of Thursday-night panic — money flying in and out, never quite sure if there's enough to cover tomorrow. It doesn't have to be that way.

In part 2 of this two-part series, Clark and James pick up where part 1 left off and move from tracking your money to predicting it. This is the level-up that lets you see the storm coming weeks out instead of scrambling the day a payment is due.

They cover:

• Why bigger revenue often feels tighter than ever
• The weekly invoicing system that keeps you a step ahead of your cash
• How to handle bank and lender draw schedules without losing control
• Using Gantt charts to predict cash flow and make clients comfortable paying
• How PAL meetings turn projections into real accountability for your PMs
• Why your project managers should set their own bar — not you
• The GM accounting worksheet that lets an office manager run your weekly cash
• The smart way to use a line of credit (and the way that sinks companies)
• Tracking profit drift from signature to final invoice — and capping your loss

If you've ever lain awake doing math in your head about tomorrow's bills, this is the episode that finally lets you sleep.

If you're doing $350K–$2M a year in revenue, coaching pays for itself. A 5% efficiency gain alone covers the cost — and that's before we even talk about growth. 

We help contractors stop losing money on crews, change orders, and inefficient operations — and start scaling. 

Ready to have the conversation? Set up a free call at contractorcuts.com

Contractor Cuts is a weekly podcast for contractors who want to build a better business — covering sales, operations, hiring, finances, and everything in between.

🔗 Book a free call: contractorcuts.com 

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Transcript

Welcome And Series Recap

SPEAKER_02 0:01

Welcome to Contractor Cuts, where we cover the good, the bad, and the ugly of growing a successful contracting company.

SPEAKER_01 0:13

Welcome to Contractor Cuts. My name is Clark Turner. And I'm James McConnell. Thank you for joining us this week. Week. This is our second week of our financial management series. Second, second and final. It is party over here. I'll tell you, finances is so fun. There's solo cups and ping pong balls all over this room. You know, when people go out and start companies, they're like, what I what I want to do? Manage my finances. I cannot wait. CPAs do say that. Yeah, yeah. Like, well, that's true. Not contractors. Uh, so today we're talking about, well, let's do this. Last week we were talking about uh how to get visible understanding of your dollars. What's coming in, what's going out, what's materials, what's labor, who's getting paid what. How do we make sure that dollars aren't leaking out of the bucket when we're managing our dollars? Um, and how to really manage a project through QuickBooks and the software uh to where we have full visibility of what our what our money uh is, um, to where it's not it, it's not the old contractor way of I just invoice a bunch, put it all in the pot, and then I pay out whatever uh I have to pay. And I hope at the end of the job I got cash left over. Um, we wanted last week to talk, we want you last week to connect your QuickBooks, um, to start managing your uh tying every material purchase to a specific job and then managing every single crew that you pay through our work order system to really track all the dollars and hold everybody accountable. If you get that done, we then next step is gonna be headed towards hiring. And so today we're talking about building projections and cash flow, which are the things that we need to have in place before hiring. So once

Why Bigger Revenue Feels Tighter

SPEAKER_01 2:05

we hire, we have a full grasp of our dollars. Um, so today we're gonna run through that. Um, you know, really we're gonna talk through uh in the PAL meeting with our employees, how we manage our employees managing money, uh, as well as how do we look into the future and project what our dollars are gonna be doing over the next couple weeks and months. Prognostication for sure. Um job costing alone isn't enough, right? Understanding where my dollars went in and went out is great start, but is not the finish line. That is what you that's the basics of what you need to be doing. Um what we know and what always happens with guys is as they grow their company, as more revenue happens, the the the bigger you get, the tighter the money gets. Uh and I I've had multiple contractors ask me this in in coaching of like, you know, I feel like I'm doing a lot more than I did last year, and I know I am. Like my my revenues almost doubled, and I feel like I'm even tighter than I've ever been on dollars. Um, and that is a number of reasons. There's not just one reason for that. Number one, uh, the bigger you get, the the lower your the more, the larger you are, the higher your expenses are, which means your profit margins shrink of your net profits, which means your gross profits might be the same. I might be invoicing 30% on every single job last year and this year, but my ex my insurance went up, my expenses went up, my overhead went up, I got that new truck. You got another guy driving that's in prices. And so there's there's all sorts of you got another guy buying odds and ends at every store. Yeah, it it's a surprise. And really the biggest change that I try to do with guys setting up the company, but also at

Weekly Invoicing To Stay Ahead

SPEAKER_01 4:05

this point, if they're coming in um as they're growing, is we need to change how you invoice. We got to get the invoicing ahead of schedule. Uh, and we're not gonna dive into how to invoice. We've we've done a podcast and we'll cover that again in the future. But the way that we do invoicing is I invoice this week for the work getting done next week. And we do once a week invoicing, and everyone says, that's too much, that's too that's a lot of paperwork and busy. It is the most important thing you can do because number one, you can plan and see your cash. Number two, you don't get over-leveraged on one job where a homeowner all of a sudden owes you $60,000 and they're not paying and they're not answering your phone calls. And oh no, I need this cash or I can't keep going. Um, but we invoice today for next week and we pay this week for everything that was done last week up through this week. And so we're always one week ahead with dollars. I take in 10 grand for what we're doing next week. I order the materials for three grand, I spend four grand on the crew, and I've got three grand left over from my pocket. So I pull in that money, I know where the money's going, I know what's my tide money versus my free money, right? I've got tide money that's going out to crews and purchasing materials. The free money is our cash for expenses and uh and pay. Um, having those systems in place takes a lot of work from the front end, getting the sub-agreement as well as the CEA in place to where the homeowner is okay with it, understands it. We've got a Gantt chart showing their what they should expect. Um, but really getting ahead of the invoicing allows us to manage the dollars correctly. Now, if you're doing this the wrong way, you're doing, hey, I need 25% at front, I need 50% at halfway, I need another, you know, up to 75% at this point and 100% final payment. If you're doing those type of draw schedules, you're using the POS system. I'm taking in a bunch of money, now I got to figure out how to spend it. How much of this is

Handling Draw Schedules Without Chaos

SPEAKER_01 6:00

mine? I don't know. Uh, I'm gonna I got my bill, so I'm gonna pay those, and we'll see at the end of the job how much is left.

SPEAKER_02 6:05

Now, there's a lot of jobs and a lot of guys that have to use the draw system, whether it's a lender or a bank or VA or you know, whatever. And any number of institutions are gonna not allow you to invoice the way that we're talking about. Yep. There is a way to do to run your job correctly. It's just a lot harder to do it. It's like it's self-control.

SPEAKER_00 6:29

Yeah.

SPEAKER_02 6:30

Because when you take in that big chunk of money up front, there's a lot of things you need to be asking the lender, like, what are the terms? It how much can I get for a mobilization fee? How much can I get up front for materials? Does do the materials have to be installed in order for me to invoice for them? And and all sorts of stuff like that. What are you retaining from every invoice that I submit? Are you keeping a percentage of that till the end? Because all of that is gonna have uh have a bearing on what your actual free cash is, and you're not always gonna be able to choose how you want to invoice.

SPEAKER_01 7:04

Yeah. I think, and this is getting in the weeds, but I think with what you're saying is exactly right in terms of this is why we have multiple bank accounts. If I'm getting a $40,000 upfront check from a from a construction loan, uh, I'm going to put that in a separate account. And what I'd like to do, now this is extra credit. I want to do weekly invoicing and pay those invoices out of that account. So I know what I'm invoicing for, what I'm about to spend, and I'm gonna pull it out of that account to pay those invoices. It's a lot of work to do it that way. Um when you get to the spot that you want to do it that way when you have a bunch of employees, it's super helpful. Um, if you're not doing it that way, at least put the money aside and only pull from it what you're about to spend on that job. Not, hey, I got my truck payment coming. I need to find some cash or come and pull out of there, I guess, because I got some profits. No, we're gonna put the money in there and we're gonna pull it out as we spend it. Um, but yeah, it's doable to do it, to do it in the draw schedule way. And the software's built that you can invoice either way. You can invoice weekly like we coach, you can invoice draw schedules because sometimes banks and lenders require that. Um, either way, what we want to do is have full control of every dollar. We need to know where it's going, where it's coming from, how we're spending it, and what exactly is profit. Down to the dollar, what's my profit that I can take? Um, not robbing Peter to pay Paul uh for myself or for my jobs. Um, how do we do this with employees?

SPEAKER_02 8:34

Uh Peter's always getting the shit end of that stick, man.

SPEAKER_01 8:38

He's been robbed so many times.

Gantt Charts That Predict Cash

SPEAKER_01 8:40

Um going into projections. One thing that we really, really want to push. Once you've organized your cash, I see the dollars coming in, I see the dollars going out. I'm tying my materials to every single job. I'm categorizing all of my spending. I'm using work orders to pay my crews, all of that's happening right now. Things are looking good. The next step, because that's that is money in, money out, what's happening today and in the past. The next thing we want to do, level two, is looking into the future, managing this week, next week, the following week, this month, and next month's money. Um, and so how do we do that? Number one, once you have an employee, um, you can do it with yourself, but this is setting it up for employee is we want a Gantt chart for every job. A Gantt chart is a tool that you that goes is a multi-faceted tool. You can use it to let the client know and understand what's going to be happening when, who's gonna be in their house, uh, understanding of it. But it also allows them to see, okay, so next week we have that, and then the week after we have something else. And so when I'm invoicing a week ahead, they can see exactly what the plan was from a month ago as to what we're doing next week. And so the client is way more comfortable paying. If they don't have a visual of a Gantt chart of when and how we're getting this job executed, and I walk in and say, uh I need 10 grand for paint next week. They're like, What type? Wait, what do you mean? That's a lot of money. I don't understand. Like they very feel very uncomfortable, like they're just kind of the the bank account that you're going to pull money out of when you need cash. If we've got a Gantt chart and a game plan around what's happening when, everything I'm doing and invoicing for is part of the game plan. And so there's a game plan, we're executing it. You owe me, pay me the money, and I'll go spend your money. Um, but having those the Gantt chart laid out is absolutely a necessity on every single job to really manage the cash flow and really set the expectation with the client as to what the cash flow is gonna be. Um James, what what size job are you okay not doing? A one-week job you don't do a Gantt chart on, or do you do a Gantt for every single job?

SPEAKER_02 10:49

Uh I think it you do a Gantt for every job because if it's a one-week job, it's not a hard gant to build. And it's the one week job that you're gonna lose the most money on in, you know, comparatively, because like it's a ten thousand dollar job, a five hundred dollar overage that you weren't expecting is a pretty sizable chunk of that ten thousand dollar job, and it's certainly a sizable chunk of your profit.

SPEAKER_01 11:13

Yeah. And if you're living by the work order system, when you sit maybe you have a paint crew going out for a week, you send a work order to the paint crew and you pick that week, you've built a Gantt chart. That's the cool part of the software is when you start assigning out work orders, it builds the Gantt chart in the background for you. And then you go over to the Gantt chart, move stuff around. Oh, I need to send new work orders because it's new dates. Cool, hit send and we're gonna send new work orders. So it all works together to really build a Gantt chart pretty quickly and efficiently. Um, once we have those built, let's talk about our PAL meetings with employees. Once we have an employee in, every single job is gonna get multiple projections. The first projection I want on every single job is what are you invoicing this month? So the first meeting I have with my PM of the month is gonna say, okay, let's go through all your jobs. What are you invoicing this month on this job? I want an estimation. I want to know what they're expecting. This is gonna be like threefold why we do this. Number one, this is me understanding the cash flow and what's gonna be heavy and what's gonna be light month, right? So this month, you know, on this job, we are really almost done and we're gonna have some big invoices, but not a lot of spend. All of our profits are gonna come in this month. Cool, good to know. Great for cash flow. Um, also, on top of that, the my employee says, hey, on this job, we should envoy $60,000 this month. Cool, great. We get to the end of the month and they've invoiced $30,000. Where's the miss, right? Is it you didn't invoice enough, you didn't push the guys? Is it well it rained constantly for three weeks and we couldn't do the siding and paint? Um, is it I had to replace a crew and another crew came out? And it's like, who's at fault for that, for that drag of only invoicing half? Or what's a

PAL Meetings And Projection Accountability

SPEAKER_01 12:55

very true thing that happens often is I thought we could do more than we could. It's just everyone was slower. So then we're using the projections to really teach the project managers a better way to Gantt chart because if they thought that double the amount of work was going to get done this month and it didn't, the client was promised double amount of work to get done and only half did.

SPEAKER_02 13:15

And a gant chart needs to be redone.

SPEAKER_01 13:17

Gantt chart needs to be redone and we need to start adjusting. Well, you'll start seeing these patterns with your project managers on hey, this guy is always 30% over budget or over projection, you know, or under projection. And it goes both ways. I don't want you to project 30 and invoice 60. I don't want you to project 60 and invoice 30. I want you to be within 10% of your projection of how we're ending the month. Um, this is the accountability side. This is how we get jobs done quicker. This is how the guys on a Thursday say, oh no, this stuff all has to be done by Friday. And they called favors into their crews. Hey, I need you to bust it tomorrow. I need you to get there early, stay late. Like, I we gotta be 100% done with paint by tomorrow because I've already invoiced for sheet rock going up or for flooring going in next week. And so those guys are showing up on Monday. I got to get you done. Right. And so the understanding of the Gantt chart, the buy-in from the crews on the Gantt chart really allows you to push them to get everything done that's supposed to be done and stay on track so we don't have lag on the job, which costs us a ton of money and opportunity costs by not starting the next job as soon as this job's done. So there's all sorts of reasons that these monthly projections are so important. Um, so week one of the month, James comes to me and says, Hey, we're gonna invoice 60,000 on this job and say, Cool, that's great, that's awesome. I'm gonna write that down on our power tracker. What does that mean for this week? Well, this week I got 10 grand that I'm gonna be invoicing for the for the work we're doing. Cool, great, all right, send that. Month two or week two, week three of that same month, he's only done 10 grand each week. We're on going into week four to say, hey James, you've you've invoiced 30 on this job. You said you're doing 60. Are you doing 30,000 this one week of invoicing? Yes or no? Yeah, I don't think that's gonna happen. Yeah, okay, so why? And so we're pre preventive preventing being reactive at this point. We're looking, saying, okay, the next two weeks are not what I planned. Let's have that conversation with the client before it doesn't happen, as opposed to after it doesn't happen. And so let's start adjusting the Gantt chart, let's start adjusting pay, let's start adjusting crews. Oh shoot, I've got that street rot crew that's gonna be supposed to go to that other job, but it's gonna have to push them a week. So let me rearrange three weeks from now to make sure that everyone's gonna get the right crews at the right time. Right. And so it forces that forward thinking and the preventative thinking and the proactive thinking because I'm looking at my numbers. I've projected this much, I'm only doing these amounts. And this is where I start coaching my PMs.

SPEAKER_02 15:48

Um, of course, is it a projection problem? Is it a crew problem? Do you need more crews? Is it because you're spread too thin, you're moving guys around too much? Like, what is the fix for you? And sometimes, you know, guys are gonna be like, we need a punch guy. We need somebody that just can come in and punch stuff out so I can move guys over to the next thing. Well, that might be nice, but maybe it's an accountability thing where you need to have your guys that you're paying to do the work, finish the work.

SPEAKER_01 16:13

I said to a coaching client yesterday, uh, she was like, um, she was like, Yeah, I mean, we her her husband's one of the crews uh that he's a 1099 sub uh running uh uh uh with the company. And she's like, uh, he always usually just kind of does the punch out stuff. And I'm like, are you taking money out of the other crew's paycheck? She's like, well, no, we just want to get them on to the next one. I'm like, so he's spending a day at each job cleaning up people that you're paying to do the work. Like, that's not how this works. That's what the work orders are for. And that's like, either come back and finish, or we're gonna take 200 bucks out and pay this other guy to do that punch out work for you. But this that's why proactive with the work orders and the subagreement, all that other stuff we talk about, rolls downhill because now, three months later, I can hold them to it, get the jobs done on time, get paid, and not have to leak that dollars by doing the work myself or having, you know, uh really mismanaging the dollars at the punch out stage. Um, all right. So the monthly, we've got the projections weekly. We're looking what's being invoiced this week and also what's going out. Well, I should have 20 grand of invoicing on this job, and we're laying out job by job. I'm gonna pay these guys. I need to order those cabinets, even though we're six weeks out from needing the cabinets. I got to put the order in because we're gonna be semi-custom. Cool. Well, let's go ahead and invoice for that from the client. We can invoice anything we're about to spend, even though we're not the cabinet phase yet. And so we start having those conversations. This projection does it sounds like when we're talking about it, it's like the principal's office. It's not. This is the starting point for coaching your PMs to be better and more efficient. And so when you're looking at it, it is literally just a measurement of how their brain's working and how accurate they're they're being. And so this is how we help them be better and really hone their skills in as they grow with our company. Um, but we're looking at the tide money versus free money and what's coming in this week and what's going out this week and next week and the week after. Doing this is turning your brain from I think we're okay to I know exactly where we stand, to the midnight freak out, to the, oh no, I've got uh $80,000 going out and 40,000 coming in, and the bank account says 10 right now. So I'm negative 30. Like, what am I gonna do? It's due tomorrow. So I got to call these crews and tell them I can't pay them, and I got to call these homoters and try to figure out how to pry an invoice. And all of that, that thing that we've all done in the beginning of running these companies of holy crap, Thursday night freak out, what are we gonna do tomorrow? Goes away, right? We're going into the um, I know what's happening next week and I can see the storm coming. Let's figure this out now before we get there. Uh, and it really allows those conversations to happen weeks uh in advance as opposed to the day of uh to where that's where the stress boils over for us uh when we're owning and running a company. Um it creates the accountability, it sets the bar with employee. But the great part is your employees are setting their own bar. Your project manager comes and says, I'm doing 60 this month on this job. Awesome, perfect. How are you gonna do that? Well, this week, this, this week this, this week this, and this week this. Awesome. That sounds good. They have just set their own accountability bar as to what they're gonna do. And so now I'm not the bad guy like, I need you to get working. Have you done this? And I need you to invoice this. Why aren't you doing this? Have you got those guys? And then I turn from that annoying boss that's doing nothing but kicking them that they're trying to avoid me when they walk in the front door, to we sit down in our meeting and we're like, hey, James, you said you were gonna do 60.

SPEAKER_02 19:48

Yeah, yeah, I know what I said.

SPEAKER_01 19:50

Well, let's let's dive into this. Uh help me understand this, right? And so I'm not the bad guy, I'm just understanding what they set the bar at and why it was there and what they're doing to get there. All right. I think that covers the projection part of this with looking at weekly and monthly uh projections. Having those numbers, knowing where your cash flow is, leads us into the next thing that I start doing. Now, this is a more advanced worksheet that I don't give you until you're in the executive level. Um, and when a worksheet that we do, especially as we're hiring office managers, which we're gonna cover in a few weeks. When you're hiring an office manager, at minimum, that's when we have to start the GM accounting worksheet. I like you to start that uh uh a while before that, but the GM accounting worksheet, it's built to manage your cash flow on a weekly basis. Uh, where uh I'm not gonna go through the whole thing, but it really all the projections of the money coming in this week on Friday, the GM gets from their guy from all the project managers, gives those to our office manager. On Monday morning, the office manager saying, okay, if I know all of this money's coming in, I know what's going out, I know our expected pay for subs, I know our expected um bills, I can now look at we've got $48,000 coming in. I need $24,000 for the cruise. I need XYZ. I've got this on the credit card we got to pay off. And we can start making CFO decisions around how and when we're gonna spend our money and what we're gonna start paying down. And we can start saying, hey, this bill is due in three weeks. Why we got an extra 20 grand this week.

GM Worksheet And Office Manager Rhythm

SPEAKER_01 21:25

Why don't we go and chip away that bill for two weeks from now? Uh, let's put 10 grand towards that bill and let's put the other 10 into the savings. And you can start making financial decisions proactively about when and how your money's gonna be spent. And this worksheet is where we allow an office manager to start making the understanding of where those dollars are going. And then they pass me that sheet on Monday or Tuesday and say, hey, this is where I think we're gonna be. And so I'm looking at saying, why don't we move this over there? Hey, this credit card is a lot of interest and this other Home Depot account is interest free. Why don't we pay off that credit card? First. And I can make those final decisions, sign off on it, pass it back to her. Office manager handles it from there, pays off everything, gets it, get gets everything organized. Now I got to make sure my guy's invoiced and collect that money. Right. And so we're we're proactively looking at this stuff, managing it through an accounting worksheet saying, here are all my bills that got to get paid. Here's the debts I'm trying to pay down. Here's what's in the current bank account. Here's what's in the savings account. I don't touch it, but it's sitting here on this worksheet. I know exactly where the cash flow is happening. Um now we've got other accounts set up that are not on this spreadsheet that your office manager is not going to see kind of all the way behind the scenes on your dollars. But this is the operating account with the money in, money out, making sure that we're staying above zero on a weekly basis.

SPEAKER_02 22:47

And the great thing about having this type of setup is when you have the clarity and the space, like even if, you know, let's say there's $12,000 on the credit card that you know has to be paid down, when you're in a state of panic and you're trying to figure things out, that $12,000 seems insurmountable because you're not looking into the details. What it might be is this week you guys spent $10,000 on the credit card because you had a big job start and you you didn't have, you know, the cred the accounts, uh you didn't have cash available to do anything, you're putting it all in accounts. But what you owe on that for this month is not $12,000. It's $2,000 that you need to come up with. But if you're just looking at the big numbers and you're not having a sense of clarity about the whole situation, every place that you everything that we're doing is like a system that is all it's always changing. There's always money being added and taken away from credit account. So when you don't have the clarity, each one of those areas is a fire. Yeah. But if you have the clarity, you can look at it and say, oh, yeah, that there's a lot of money on that, but that's okay. We don't need to attack it that way. We're looking all the way down the road, one, two, three months down the road, and we can see how that gets paid off. Okay, we're good.

SPEAKER_01 24:06

Yeah. And it's also not the bucket system. Like what James is saying of I'm not just gonna make my minimum payment on that credit card. I I put 12 grand on that card from these two jobs, and one of these jobs paid already, and the other job is a bank loan. And so they said they're funding on the 15th of this month. So I tell my office manager, hey, on the 15th, when this money comes in, that 50K should hit our bank account. I want 12 of that immediately to go pay off this credit card because that's what that job was for. And so I don't have to just minimum payment and I take that 12 and I put it in my pocket and we went ahead and booked that beach vacation with that money. Yeah, don't do that. But I'm paying my minimums on my credit cards, right? And so it's it's understanding the cash flow of it uh to where I'm I'm not uh spending money that I that is not mine. Um it's actually money that was spent that was borrowed from the credit card and spent on the job. This is how we the only way that I sign off on a coaching client having a line of credit. Now sign off on that, I work for them. They, it's their final choice. But for me, how I manage a line of credit is there's only one way that we use a line of credit. And what I want you to do is build a side bank account and you be your own lender and have

Smart Line Of Credit Rules

SPEAKER_01 25:20

a hundred grand sitting in a bank account. Um, and that money is what my line of credit is that I'm going to borrow for myself. And so we have that cash that we've built up. And I say, hey, this is a job that I've sent the final invoice. We're 100% done. They owe me 40 grand on this final invoice. It's a 30-day net pay. Because of that, I've got 30 grand owed to me on here. I have to go to my uh office manager and say, hey, uh we're gonna fund that final payment, that 30 grand out of our line of credit, which is hopefully your own savings. I'm gonna take that 30K out and I want you, office manager, when that hits our account or when that check comes in the mail, I don't want to see it. I don't want anyone to know about it. I want you to deposit it and put it right back on the line of credit. So we're prepaying invoices using that line of credit. We're not just borrowing money for overhead. We're not just taking lines off the credit and like, well, we got payroll. I guess hit the line of credit, we'll make up it, make it up next month. That's not how we manage money. That's how a person that's gonna crash a company manages money, is we'll figure it out next month. What we want to do is say, I've got this much money owed to me. I'm gonna sell off those invoices to myself or to my line of credit, receive that money and go ahead and pay the money owed to me. And that's what I'm gonna live spend within my means and live within the money owed to me and not allow uh a lender that's gonna take 30 days to pay me to stop me from moving, but also I'm not gonna rob Peter to pay Paul and just pull money off the line of credit, hoping next month I sell more jobs and repay it. So that's that's the only time that I'm okay with lines of credit um within a company. Um predicting cash flow is actually the most important thing that that we're going for. What everything we're talking about today is based around you sleeping at night. Knowing where your dollars are, where they're coming from, and when the issues are going to be allows you to know, hey, we got no issues. I can I'm good. I can go play golf on Friday because everything's done. We can check all the boxes, we know where all the dollars are. Even if you don't have an office manager, even if you're a one-man show, this is still the way to do it. I'm looking at the money coming. I'm only spending, I'm staying on a budget. I'm only spending what I have to spend. Uh, and I'm, and I'm really pulling the profits out. I'm putting that aside, I'm paying myself a paycheck steadily. Uh, you know, all of that stuff where we're planning it out and knowing what's happening next couple months is how you feel safe, secure, and how you get to a spot where it says, Hey, I think I'm ready to hire. I think I can hire. I know where the dollars are. We got these jobs coming. If I land this one big job, we'll be good through the end of the year. Why don't we do X, Y, and Z? That sort of proactive thinking with your dollars is where you really start gaining traction and growing your company. Crawling means you're seeing the money. Walking means you're controlling the money, and running is where you can predict where your money's coming and going from. Those are kind of the steps

Profit Drift Tracking And Closing CTA

SPEAKER_01 28:20

we're trying to grow you inside of and get you to that final um predictive state of your company with your dollars. Um, the GM accounting worksheet is something I love to give you if you if you come into coaching. Again, uh, we don't introduce that until you're ready, um, but it's a really, really cool um thing that we have. Try this monthly projection next this month. If you try and do it on a couple of jobs, I'm gonna project what I'm gonna do this month. I'm gonna project weekly what I should do. Start implementing thinking forward and then hitting those goals and trying to hit them. And if you're missing the mark, cool, adjust it. I keep underbidding, I keep overbidding my amount of time it's gonna take me to do stuff. Let me start adjusting and tinkering with those numbers so I can get to a spot that is dependable when I'm telling my client timing. Um, track profitability throughout each job. Um, this is something big, is I want to see the percentage of profit when the estimate is signed and the profit percentage when I find do my final invoice. I want to know the difference of those two numbers. That is one of the most important numbers to track to understand if you're gonna make or lose money in running your company. If we're starting at 38% and finishing at 28%, you're losing 10% on every job. That's a big problem. Let's find those holes, let's patch those holes, and let's try to keep it no more than one and a half percent loss on a job. I want, if I'm bidding at 35, I don't want to drop below 33 and a half. Let's have those, those. It's okay. You're gonna have some some money loss on a job. I'm capping it one and a half percent. All right. Any final thoughts on dollars, James? No, I wish you all the best in all of your endeavors. I I think this is a spot that people get overwhelmed and throw their hands up and be like, screw, I I'm not, I'm just I'll figure this out next week.

SPEAKER_02 30:11

When you get when you get a taste of the sense of relief of having control over the budget, yeah, the uh all the other stuff just seems a little bit easier. And like even having the conversations with uh project managers about spending and about the gas, like it's not coming from a place of anxiety, it's coming from a place of hey, yeah. Just so you're aware, last month you spent a thousand dollars on gas, this much month you spent eleven hundred on gas. Everybody else is at like six hundred bucks. What's that? What's you don't have a different workload? Like, help me understand the gas.

SPEAKER_01 30:50

Yeah, yeah. You you can really start honing in. That's that's when we go next level and then diving in the profit and loss statement. We start looking at the categories. Uh, and that's what James is talking about, where we start finding where the dollars are leaking out. Um, I think the this is super overwhelming to people and they just kind of throw their hands up. Go back to last last week, listen to that one, start the baby steps to get there. We will work with you on this. Come in, uh, go to contractorcusts.com and set up a meeting. I love to talk with you for an hour about how this works and how to start implementing where you're at today. Um, you're not gonna get there unless you start taking these steps. It it you can't get there by tomorrow, but we can start taking the steps to get there by the end of this quarter and really start growing towards 2027 and building into next year. So we love to chat with you about that. Go to contractorcuts.com. Um, if you want help on your business or anything else, let us know. Next week's podcast, we're doing a half year reset. Uh, it's it's it's releasing the beginning of July. So it's um it's going to be you know July through December. What do you need to do to reset your company um and really grow the second half of the year? So definitely tune in next week. Excited about it. We'll talk to you guys later. My