Let’s talk about one of the most ignored, most misunderstood, and most expensive problems I see in construction: not tracking job costs.

Here’s the truth: if you don’t know what it costs you to complete each job, you have no idea whether you’re making money — or losing it. Your gross profit margin lives and dies on job costing. And without it, your bids are built on guesses, not facts.

I’m not just talking about the obvious stuff like materials and labor. I’m talking about the whole picture:

• Material waste
• Subcontractor overruns
• Labor efficiency
• Equipment rental overages
• Jobsite deliveries, fuel, cleanup

If you don’t have a system to track those in real time — not months later when the accountant runs a report — you’re leaving profit on the table every single job.

I worked with a GC who said, “We just price based on what the market will bear.” That’s a nice way of saying, “We hope it works out.” When we finally broke down the numbers, we discovered they were losing $1,200–$3,500 on every third job — not because they weren’t busy, but because their labor estimates were off and their subs were blowing the budget. We installed job cost tracking on a Google Sheet, had the project manager update it weekly, and added a 10% contingency to every future bid. Within 60 days, his gross profit jumped from 26% to 34%.

If you don’t measure the money going out on each job, you’ll never control what’s left over.

Not tracking job costs yet? Or not sure your numbers are accurate?

Pick up your free copy of my new book, “The 7 Minute Conversation-How to Hear the Story Your Small Business Financial Statements Are Telling You-CONTRACTOR EDITION”.  Go to www.7MinuteConversationBook.com

Ready to find out where your cash and profits are really going? Book your free 15-minute Profit and Cash Flow Call with me. No pressure. Just real clarity. I’ll help you see where your money’s hiding — and what to do about it. Schedule at www.CashFlowCallWithLarry.com