You Can’t Fix What You Don’t Measure-If you’re not measuring it, you’re guessing
Let me ask you something straight: How are you tracking performance in your business?
Most contractors tell me, “Well, I know when something’s off.” Or, “I look at the bank account.”
But gut instinct isn’t a system. And the bank balance? That’s a lagging indicator — by the time you notice a dip, it’s already too late.
If you want better results, you need better measurements. And I’m not talking about drowning in spreadsheets. I’m talking about five core numbers every contractor should track weekly:
- Cash on hand
- Outstanding receivables
- Job gross margin %
- Labor hours vs. estimate
- Open jobs in the pipeline
That’s it. If you check those five numbers regularly, you’ll know exactly where your business stands — and what needs fixing before it becomes a fire.
One contractor I helped had strong sales — but profit was hit or miss. He couldn’t figure out why. We started tracking gross margin by job. Within two weeks, we saw it: one crew consistently came in 10–15% below target. The foreman was great with clients but not managing labor well. A few simple changes in crew scheduling brought the margins back up — and added $48K to the bottom line that year. All from tracking one number.
Clarity creates control. Control leads to better decisions. Better decisions build wealth.
Want help identifying your top five metrics?
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