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Tips & Advice

How General Contractors Can Stay Organized and Generate More Leads in 2021

With the new year brings time for professionals in the construction industry to review business processes and efficiencies. That being said, it’s safe to say that there’s a lot of room for reflection as a result of unprecedented challenges faced in 2020 that have impacted the way we all work. In particular, for general contractors, it is a time to analyze what worked and what didn’t to ensure best practices are in place moving forward. Much like every transition from year to year, contractors should reflect to revamp their organization and lead generation techniques. Using these tips will help contractors start the new year off with not only peace of mind, but also with a plan to confidently move ahead in 2021.

Organize Your Office Space

With every project, making sure your business has a solid foundation from which to expand is the key to success. Perhaps your construction team has moved to a semi-remote or flexible arrangement, and ensuring everyone is on the same page and project management practices are being upheld is key. You and your assistants should set up your home offices appropriately so that you have a dedicated space away from distractions. If your home is not suited for an effective office space, you may want to consider a mini-renovation. When renovating a room in your home, it could be beneficial to invest in a home warranty to preserve the most essential home appliances amidst the renovation process. Investing in a home office is well worth the benefits. Your team might even feel more comfortable and more productive while working out of their home.

Once you have your home office set up to your liking, keep it organized and clutter-free. To stay even more organized, opt for an electronic cloud platform to keep everyone on the same page and save headaches. It is also essential that distributed teams are not working in silos and have access to vital job resources such as business purchases, invoices, and job site information at all times.

Use the Most Efficient Software

Laptop displaying a dashboard for a construction job

Having the most efficient construction software at your disposal will help your business stay more organized in comparison to your competitors. Having an organized office space is just half of what it takes to be as efficient as possible. Without the right software, itemized data can get lost in the mix, leading to hardships that are easily avoidable. Certain construction software systems provide a diverse range of organizational features from accounting all the way to time and compliance tracking.

The best construction software systems have all of their features in a cloud-based solution. Such software provides a wide range of different industry practices such as reporting, document management, time entry, forecasting and more, all in one solution. Some handy specific features include job costing and accounting. A job dashboard feature displays real-time KPIs for project managers to assess the status of projects, instead of developing a report. With built-in accounting features, accountants can create live financial reports for multiple groups while saving time and energy. Leveraging the advanced features of construction software gives you vital time back into your schedule to work on more customer-facing responsibilities.

Manage construction projects with the job dashboard in Premier

Be Attentive to Customers

A crucial aspect of generating leads in the construction industry is being as attentive as possible. To simplify, this means always answering your phone. Answer with a purpose and show the caller that you truly care about them and what they have to offer. Doing this will make the customer feel like a priority and will be a step in the right direction in how your business is perceived.

Another way to show your customers that you care is by returning quotes in a timely manner. Understandably, contractors are very busy and ultimately, the client is waiting for you, and all they can think about is their job. Being honest with quote prices and being rapid in response can not only help the client with a quick turnaround, but can also lead to potential referrals down the road. Lastly, to show your appreciation for the customer, consider sending a thank you note showing your appreciation for the business opportunity. Hopefully, over time this will lead to impressive reviews and meaningful relationships.

Stay Busy and Keep Your Costs Down

An important part of being a contractor is to stay busy with the right jobs for the right money. Some contractors tend to overshoot when going about their business. This can often lead to an overwhelming feeling and missed opportunities. Although taking on large, lucrative projects is desirable, it can cause you to be burned out, and smaller guaranteed opportunities can slip away.

Keeping your schedule full for a reasonable rate will not only lead to consistent income but will also lead to an improvement in production. Fundamentally, smaller jobs can often lead to larger jobs. If you show consistent communication skills and honesty about the project, clients will remember that. There are a variety of ways for contractors to save money, but the most effective ways are using a cost-efficient fleet, buying quality equipment, and renting your most expensive gear.

Be Open to New Ideas

It seems that almost every year social media grows much faster and larger than in previous years. Social media can be a great way to strengthen the community and can also be a landscape of learning and can lead to new project opportunities. Be open to new ideas and find more innovative ways to do your job. Finding innovative ways to do your job can help separate yourself from some of the more traditional contractors.

Use social media to your advantage; it can be a great way to learn new ideas about the business, but can also help market your business. Creating a social media presence that is constantly up-to-date, attractive, and shows previous customer reviews can be the most influential. Having established social media pages that customers and clients can easily access will drive more revenue by creating a space that is organized, reliable, and known for quality work.

Conclusion

To conclude, 2020 was a challenging year full of twists and turns that forced contractors to do things they’ve never had to do. Having the ability to plan out ways to generate revenue and gain new clientele is one way to prepare for what 2021 throws your way. Use these tips to attack 2021 with a sense of purpose.

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Tips & Advice

How Investing in Construction Software Will Save You More Money in the Long-Run

Once upon a time, construction projects were managed by hand with pen and paper. The construction industry has since evolved to be heavily centered around and contingent upon the use of technology, and it continues to evolve as technological advances make it possible to manage and complete projects more efficiently, saving businesses money in terms of both time and resources.

Every construction project consists of a number of different processes, with a team of project members and stakeholders responsible for various aspects. Even a small project can have hundreds of moving parts, as well as numerous construction documents that need to be managed, stored, and shared. Without the right organizational tools, clear communication, and close oversight, things can get out of hand pretty quickly and result in budget overruns and schedule delays.

Construction management software provides the tools and structure to help you more effectively manage all phases of a construction project, from initial planning to closeout—but not all construction management software offers the same benefits. In a recent blog, we outlined the key differences between a cloud-based vs. on-premise solution. In this blog, we’ll dive deeper into how a cloud-based, SaaS solution will save you more money in the long-run.

No Extra Costs

One of the biggest advantages of a cloud-based solution is the immediate cost savings, which ultimately translates into long-term cost savings. On-premise systems require a large initial investment because of the server hardware, software licensing, deployment, and IT support staff. In addition to the large upfront investments, on-premise solutions require ongoing maintenance to the physical infrastructure, in addition to the time required to perform routine software maintenance, back-ups, and updates. With a cloud-based, “pay as you go” model, all of those costs are eliminated. Everything is saved on the cloud, updates and maintenance are handled by the service provider, and all you have to do is pay a subscription fee.

Efficient Resource Management

One of the most fundamental aspects of successful project management is understanding how much time and resources are required to complete various tasks. This information is not only important for monitoring current projects but also provides critical insight that helps project managers more accurately forecast future projects. Construction management software offers time tracking capabilities that give project managers the ability to constantly monitor progress, and to see exactly how much time and resources are being spent on each individual task to ensure resource management is optimized.

Streamlined AR Billing

The construction industry utilizes several different types of billing methods, and sometimes there may be multiple payment methods required for one project. Because of this, knowing how much to bill clients, and when to bill clients, can be tedious to track—especially considering most companies have multiple projects occurring simultaneously. Construction management software can take the guesswork out of your AR billing by streamlining the entire process, saving you valuable time, while also providing a higher level of accuracy than manual entry.

Automate your cost-plus billing process using Premier Contstruction Software

Less Paperwork

Paperwork can be a huge pain—and a huge cost—in the construction industry. Construction documents can be hundreds of pages long, making it a cumbersome job to manage manually, especially when you consider the number of changes and revisions that are made throughout the entire process. Construction management software not only saves money on paper and ink by providing one centralized location to store all construction documents digitally—which also means you’ll never have to worry about losing a document again—it also saves a huge amount of time by updating documents in real-time to ensure everyone has the most recent version at their fingertips. And with a cloud-based solution, you’ll have the added benefit of unlimited storage.

Organizational Performance Improvement

Construction management software can help you improve organizational performance by providing detailed reports with the information you need to make better, faster, and more informed decisions. With a number of different reporting options and a customizable dashboard, project managers can easily view high-level KPIs, pending items, approvals, as well as cost and revenue summaries, each with full drill-down capability.

Conclusion

Running a construction company and ensuring its ongoing profitability is no easy feat, but investing in construction management software is well worth the cost in the long-run given its ability to save you time and money in so many different ways.

To learn how Premier Construction Software can meet your company’s specific needs, click here to schedule a personalized product tour.

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Industry Insight Tips & Advice

What Makes a Successful Construction Project?

The goal of every project manager (PM) is to run a successful project from start to finish—which begs the question, “What makes a construction project successful?”

Generally speaking, a project’s success is gauged by the amount of time, money, and resources required to complete it. Therefore, the success of any project hinges upon the project manager’s ability to create a detailed process plan that can also adapt to real-time changes and unexpected situations. Because, let’s face it, in this industry you have to expect the unexpected—and find a way to plan for it—in order to keep your project on track. 

While it’s no easy feat, with the right people and strategies in place, project managers can consistently deliver projects that are on-time and within budget. 

Implement continuous planning

Project Manager sitting in office and working on desktop pc. Businessman looking at construction project spreadsheet while working in office.

During the planning phase, project members and stakeholders will establish deliverables, define goals, and outline project milestones. A well-planned project will provide a timeline and a step-by-step roadmap to complete the work on time and within budget as agreed upon in the initial meetings.  

But anyone who works in construction already knows that even a “simple” project is never really simple—it can, and almost certainly will, morph and evolve and require some level of change. For example, encountering unexpected environmental issues during the pre-construction phase could result in the need for design changes, which could then impact the entire construction plan and timeline.   

Because you never know what could happen, project managers should continuously revisit and rework plans as necessary throughout the entire project lifecycle to mitigate risk, as well as unexpected costs and delays.

Have your risk log ready

Being able to identify, monitor, and mitigate risk is fundamental to successful project management.  During the planning phase, project managers should prepare a risk log that outlines any foreseeable risks the project may face, as well as an action plan for what to do and how to resolve any issues that arise. 

Once the risk log has been drafted, it should be distributed to project members and stakeholders to equip the team with the confidence and know-how to resolve any issues, as well as to provide comfort to the client by showing there’s a game plan in place to tackle any foreseeable risks that may arise.

Hire the right people

Project Manager sitting in office and working on desktop pc. Businessman looking at construction project spreadsheet while working in office.

As is true in any industry, the people on your team will either contribute to your success or failure. Because construction project management has so many different components, variables, and moving parts, it’s absolutely critical to have the right people assigned to every aspect of the project to create high-performing, cross-functional teams. 

Every core project member, vendor, supplier, and stakeholder contributes to the overall team dynamic, so it’s important to make sure they all share the same level of commitment, understanding of the project, adaptability, and desire to succeed. Any inadequacies or dysfunction within a team can easily send a project spiraling in the wrong direction.  

Establish an effective communication plan 

Every single phase in the construction project lifecycle requires constant communication and collaboration. Any delays or miscommunication can lead to costly mistakes and project delays, so creating an effective communication plan is critical to ensuring the most accurate, up-to-date information is getting to the right people on time. 

One of the easiest ways to build an effective communication plan is to utilize a cloud-based project management software. Project management software provides the ability to add specific team members to projects where they can access all of the pertinent information and contract documents in one secure, centralized, and easy-to-access location. Using a centralized platform not only provides transparent communication that facilitates coordination between all parties, but it also creates accountability among team members. 

Constantly monitor progress

laptop with Jonas Premier Dashboard screen in construction office

For a project to be successful, the project manager needs to keep a constant pulse on what’s going on. This is another area where project management software can add significant value and help avoid costly mistakes. As we’ve touched on a few times, all projects—large and small—have a lot of moving parts that need to be constantly monitored to keep projects on-time and on-track. 

Project management software allows PMs to monitor data in real-time and provides the ability to generate custom reports that can be shared with other team members and stakeholders to keep everyone informed and on the same page. Additionally, consolidated dashboards make it easy to digest and consume multiple reports on one screen, and to identify any red flags, items pending approval, or actions required for next steps. 

Manage construction projects with the job dashboard in Premier

Conclusion

The best way to improve the likelihood of successful project completion is through careful planning, ensuring you have the right team in place, maintaining constant communication through defined channels, and continuously monitoring progress to mitigate risk, cost, and delays.

To learn how our cloud-based project management solution can help you do all of this and more, click here to schedule a free personalized product tour.

Author Biography:

Kathryn Dressler is a content strategist with more than 10 years of experience across the spectrum of marketing services, including blogging, social media, public relations, copywriting and editorial services.

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Accounting Tips & Advice

How to Create a Job Cost Report Using Construction Budget Software

Construction projects are complex. Getting accurate job cost information can be difficult if you’re not tracking costs and revenue in an organized manner. Trying to track budgets on multiple projects using spreadsheets and generic accounting programs simply doesn’t work. Financial Construction Software is a must-have for any organization that wants to be in financial control of their jobs and overall business.

The most challenging part of any system is to make sure the foundation is set up properly from the start. Project budgets must be broken down into cost items and cost types. Commitments are posted against these codes to help provide an accurate picture of what is remaining on the budget. Any deviations from this should be tracked via a change order so you can have an accurate picture of where a project stands, where it will finish, and analyze the month over month variance. If the job cost data is entered properly, it is easy for the accounting team to match the commitment and identify any red flags. This way businesses can rely on the job cost reports and there is less risk that you are caught with surprises at the end of the job. Having the information in real-time makes it easy to drill down to view the information and make more informed decisions, faster.

Setting up job cost accounting software

Setting up a job costing system isn’t complex if you have the right software, but it does require some planning. Here are some recommendations to help you better track your job costs using proper financial construction software.

Break down the job estimate into cost items and cost types. These codes represent specific types of work or areas on each project. Most companies use Excel to build out their job estimate as it can be very sophisticated with specific calculations. Other companies leverage 3rd party bidding/estimating packages specific to their industry. Premier Software provides up to five levels of job cost breakdown so you can track costs by the job number, cost types, cost items, and an additional 4th and 5th level of breakdown which are completely configurable to track further breakdown by buildings, units, lots, areas, custom levels etc. You can also group the cost items by CSI division codes.

Enter the job estimate into your financial construction software. In basic accounting systems, most users have to manually rekey the job estimate into their accounting system which can be very time-consuming. In most Construction Financial software solutions, you can upload the job estimate from excel or any 3rd party in just seconds. In Premier, you can do just that so you save valuable time.

Once uploaded, you can lock the original estimate so if anyone applies changes, they are properly tracked via change orders. This gives project managers better visibility into the variances and holds project managers accountable to their original estimate. Cost types are available on the job cost reporting but they are typically connected to your financials to the COGS or WIP accounts. This way business owners can get a macro view on how the company is performing across the jobs. Examples of cost types include Labor, Material, Subcontract, Equipment, Hard Costs, Soft Costs, Marketing, Other. Whereas, the cost items do not roll up to the financials. These are the phases of the job that typically provide the detailed job cost breakdown to help project managers assess the performance of the job. Examples include Electrical, Foundation, Demolition etc. These are typically sorted and grouped by CSI Division codes which are helpful when running summarized reports.

Enter commitments. Commitments are typically used to track labor hours, subcontractor agreements, and/or purchase orders for all material purchases. These should be entered into the accounting system as they are issued so it’s easy for a project manager to see what is remaining in the budget. You can set alerts or hard stops if a commitment is exceeding the budget or if a user is allocating incorrectly.

In Premier, you can automate the generation of these commitments to help save valuable time and ensure proper allocation.

Track change orders in the system. Both owner change orders and internal changes need to be entered into the system to properly track job costs. Change orders are used to track requested or required changes to a job that were unanticipated at the start of a job.  It is imperative to track change orders since they often have a financial impact to either the company running the job, the customer, or the subcontractor that is working on the job.  Budget Transfers are an auditable way to move funds between cost items on a project. They’re often used to allocate to and from the contingency and balance the allocation of budget when one part of the project is performing better than another.

Allocate actual costs to the job. Accounts payable, GL entries and payroll costs should be allocated to the proper job cost on a timely basis so project managers compare it against the budgeted cost of those activities, so that the cost variance from budget is known continuously. … especially valuable if the organization performs many projects that are very similar to each other. Payroll costs should include burden, such as employer taxes, benefits, and employer-paid insurance.

Running job cost reports

Once the project has been set up, the job budget is entered, commitments are posted, change orders are updated, and actual costs are posted, the estimate at completion should be accurate and you can rely on the job cost reports. Premier Software has several out-of-the-box reports and project dashboard that consolidate accounting and job costing information which make it easy to see where you stand on the job, help you identify red flags, and make it easy to drill down into the details.

Project dashboard. The project dashboard provides project managers and executives a high-level overview of each project and drill down into any job cost or accounting details in just seconds. It provides useful KPIs to help identify the original vs. forecasted margins, overbudget items, overpaid vendors, WIP, cashflow, retainage, and AR & AP information. Also, a PM can easily create or view submittals, RFIs, meeting minutes, daily job logs, and unbilled change orders. Take action to approve, view, or electronically sign pending subcontracts, change orders, AP invoices, AR billing, and more.

Manage construction projects with the job dashboard in PremierJob Cost Progress views – This report provides a detailed or summary view of the job providing a full breakdown of the costs and revenue. View the original estimate, commitments, remaining budget, actual costs, monthly costs, % complete, estimate at completion. With multiple filters available, project managers can easily filter by cost item, cost type, cost groups, and more. Easily evaluate project managers and hold them accountable to key KPIs.

Work in progress report. The WIP report shows businesses whether active jobs are overbilled or underbilled. Cost overruns are common in the industry. It’s far too easy at the mid-point of any project to misjudge billing against the actual status of the project. The success of a WIP report depends on keeping accurate cost records and consistent documentation.

Forecasting reports. Project managers should forecast monthly and review M2M variances. A forecast can be considered a precursor to a Potential Change Order. Unlike a change order, however, a forecast is a well-informed prediction of trends that are arising that need to be identified and captured prior to a change order. Any predicted trends that turn out to be true, can then be converted into a change order and become part of the project budget & schedule. Premier helps by allowing PMs to enter in anticipated costs. The anticipated cost value impacts the estimate at completion providing a more accurate picture of where they will end on each line item.

Premier Construction Software makes accurate job cost reports easy

Using financial construction software for accounting, job costing, project and drawing management makes project managers’ jobs easier. It automates the most time consuming and complex processes so they can focus on what matters. Trying to track and report on this data by hand is difficult and time-consuming. Premier Construction Software helps project teams know their profitability and see potential issues quickly and easily.

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Accounting Tips & Advice

7 Benefits of Outsourcing Payroll Versus In-House Processing

Making the decision about whether to outsource payroll or keep it in-house takes a lot of thought and preparation. Construction payroll can be complicated, and you also have to make sure that your payroll costs are allocated appropriately.

Before you decide what to do about your payroll, keep in mind these seven benefits of outsourcing construction payroll.

Benefits of outsourcing payroll

1. Save time

Processing payroll takes time. If you’re just starting out with new software or new employees, there’s the software set up, employee set up, timesheet review, timesheet entry, and then calculating pay and taxes. Depending on the size of the company and how frequently employees are paid, payroll processing can require a part-time or full-time staff member. Administrators can easily spend 20 hours a week just processing payroll and dealing with payroll-related items.

By outsourcing payroll processing, you’ll free up hours that have been spent on these administrative tasks. Instead of staff working part-time to process payroll, they may only need to spend a few hours getting the information ready for processing. Having another company provide these services will give your staff more time to work on the business and serve your customers.

2. Expertise

Most construction companies ask their office staff to provide many services, of which payroll is only a small part. Unless you need a full-time payroll processor, you look for potential admin employees that have multiple skill sets, because admin staff often spend their time working on a variety of tasks. All this means that payroll knowledge is often secondary to other skills.

A payroll service specializes in providing only payroll processing, so you know they have the expertise needed. Also, outsourcing services use the most up-to-date software ensuring that your payroll is accurate and that it’s performed as efficiently as possible. When updates occur, as they always do, you won’t have to spend valuable time getting up to speed or paying your employees to learn a new process.

3. Keep current staff level

As your company grows, payroll begins to take more and more of your administrative staff’s time. You may find you need to hire more staff just to handle the workload from payroll. There’s added cost and time for onboarding a new employee, training them, and getting them up to speed. Spending time and money on acquiring staff and training them keeps you from doing your work.

By outsourcing, you won’t need to add more staff just to handle payroll as your company gets larger. The service will be responsible for expanding to meet your needs. If you outsource, you can easily assess your staffing needs without having to worry about added payroll processing.

4. You’re always in compliance

It’s imperative to your business that you obey and comply with the laws and regulations for record-keeping and storage of documents, especially when it comes to payroll. Payroll laws are always changing, and software updates are a regular occurrence. Keeping up with the latest and greatest is time-consuming and can be confusing when staff are working on other tasks as well.

A payroll service is always up to date on the most current legislation and tax amounts. They’ll inform you of any changes that need to be made in your business practices, and the rest will be handled as part of your service package. You can rest easy knowing that your payroll is in line with the latest regulations.

5. Lower costs

Processing your own payroll means you have to purchase software, pay for a payroll service subscription, and provide staff time for software set up and payroll processing. Not only that, but you also have to maintain the security of your payroll records and ensure that sensitive information isn’t accessible. All these expenses quickly add up, making providing your own payroll processing a giant headache.

Having someone else do your payroll, including providing the software and set up, allows you to spend your resources, both time and money, on the work you do to make a profit. The savings in software expenses and staff time more than pay for the cost of outsourcing.

6. Complicated payroll is easy

Construction companies often work in multiple locations and multiple states. This complicates the payroll process by involving multiple jurisdictions, taxes, and compliance regulations. Keeping track of all this information for each state your company works in can be overwhelming even for the most experienced administrators.

An outsourcing company knows the laws and regulations for each state and what to do when your employees are working in multiple states. Their software is already set up to handle even the most complicated of payroll situations.

7. Certified payroll is effortless

If your company works on public projects that are subject to prevailing wage laws and require certified payroll reporting, payroll processing is complicated. Union companies also have detailed reporting requirements. Setting up a software system to handle certified payroll or union reporting is a complicated process that can take your staff hours to complete. On top of that, not all payroll software provides the necessary reports for this type of payroll, meaning that your staff has to spend extra time compiling the information required.

Outsourcing companies that specialize in construction payroll have the systems in place to handle prevailing wage and certified payroll reporting with ease. You simply provide the information for each project and the processor takes care of the rest. They’ll send you the reports you need with each processing and you simply turn them in to your clients or the union.

Payroll outsourcing saves time and money

Save your company time and money by outsourcing construction payroll. You’ll ensure that your employees are paid correctly, and records are stored securely, keeping your company in compliance. You’ll save staff time and admin costs, making your company more efficient and profitable.

Author Biography:

Dawn Killough is a construction writer with over 20 years of experience with construction payments, from the perspectives of subcontractors and general contractors. Dawn has held roles such as a staff accountant, green building advisor, project assistant, and contract administrator.  Her work for general contractors, design firms, and subcontractors has even led to the publication of blogs on several construction tech websites and her book, Green Building Design 101.