Let Us Help Reduce Construction Business Start Up Stress Part 2 Of 3We Are QuickBooks Experts Specializing In Construction Bookkeeping ServicesNew Contractor's Levels of Stress
What To Do Next - You have never run a business. The only thing you know is your old boss was a terrible business manager and anyone could do better than that. But now that you are the boss you don't know where to start NOW THAT'S STRESS!
Spending Time To Set Up - Your construction company properly will save you grief, time, money and pay you dividends in the future. In addition you will do a better job protecting your business and personal assets.
- Get Organized - Pick a company name that says something about what you are doing. We strongly recommend a Subchapter S Corp (a Sub S) for tax advantages, protecting your personal assets in the event of a claim or lawsuit against your company and for future expansion. Consult with a construction attorney and follow their advice.
- Tax Advantages For LLC or a Sub S - The profit or loss from your business is passed through to the owners as normal income. Since the LLC or Sub S does not pay state or federal income tax (as separate business entities), you may be able to save money over a Sole Proprietorship; no double taxation.
- Partnerships Are The Only Ships - Designed to sink. We recommend stay away from them like the plague.
- Bookkeeping Service - That understands construction is best when you start because we can setup QuickBooks correctly in the beginning and take care of the accounting until you are ready to take over.
- Bank Accounts - Set up two bank accounts in your company name. All large income and expenses go through one account and keep the debit card in your personal safe. The second bank account is for your debit card you keep in your wallet and has no more than $500 or whatever you need for small purchases during the week.
- Never Co-Mingle - Personal and business money or you could lose the tax benefits and personal protection of your corporation.
- Put Money In And Take Money Out - Of your business is O.K. in done correctly. Your bookkeeping service can advise you on how to do it so that it is recorded in QuickBooks properly.
- Insurance - Is critical to your construction company. General Liability and Auto/rental equipment insurance can help protect you and your company against claims for personal injury and property damage, and may provide you with legal defense of those claims. Talk to an insurance agent that understands construction about your insurance needs.
- Architectural or Engineering Designs - Similar services are good reason to get Professional Liability (Errors and Omissions) insurance to help protect you and your company from claims arising out of mistakes in designs and calculations.
- Contractor's Licenses - Information changes rapidly so check online for your local county or contact us and we can help 206-361-3950 or email firstname.lastname@example.org.
- Performance Bonds - If you are doing public sector work you will probably be required to provide a performance bond to ensure that you complete the work in accordance with terms of the contract. Bonds or guarantees are provided by surety companies. Getting your construction company qualified is a process because the surety company will go through a due diligence process on your company to determine how much money they will write or guarantee for your bonds.
- Business Planning And Strategy Development - Is the blueprint for your business to succeed. You get out of them what you put into them. Garbage In = Garbage Out! Your business plan is a living breathing document that you will change and update as needed. It provides the baseline and milestones for your business and lets you make decisions in advance in the calm environment of your office instead of "on the fly" while driving, talking on your cell, eating lunch, and putting together a bid. It is a must have to borrow money from a bank.
- Paperwork - Begin the habit of putting all paperwork into manila envelopes which you write the job name on both sides in big letter. If you are thinking of doing your own bookkeeping think again, your time is more valuable in managing your business, getting customers and keeping them happy. Let us take care of your accounting.
- Estimating Process - There is no one right answer. You can develop your own estimating and pricing process or you can use something like UDA.
- Contracts - We recommend seeking the advice of a qualified construction attorney to put together a contract that fits your specific needs. Your contracts need a well-defined scope of work, clear payment terms, a reasonable schedule and a good change order clause. No work should ever be performed based on verbal agreements. Get everything in writing, always, no exceptions!
- Invoicing - For small projects we have a Free Invoice Template you can download and for larger projects with multiple deposits, change orders, progress payments check out our Pay Application.
- No Financing - Your customer or client's project by providing a substantial amounts of labor, material, subcontractors and rental equipment hoping to get paid later on down the road. McDonald's restaurant model: #1 Customer places order #2 Customer pays #3 Customer gets food. I have owned and operated several construction businesses and have clients who do it now and always work on "Other People's Money (O.P.M.). Nothing will kill your business and your hopes and dreams faster than running out of money.
- Marketing Then Sales - Is a process that never stops. Selling convinces your customer or client to buy your construction services and it comes after the marketing step. Knowing how to write proposals for customers or respond to a request for proposal (RFQ). What makes your company different than the competition? What are your strengths, weaknesses, opportunities and strengths? Perform a SWOT Analysis. Never ever bad-mouth your competition; it's temping but unprofessional and they might actually do a better job than you do.
- Join Trade Organizations - This is a great place to meet new customers and get lots of referrals because construction is deep and wide and no company does it all. The best one we have found is The Master Builders Association. And spend time learning about Networking For Contractors. This organization is good for all construction and related industries.
- Labor - Can include yourself in the beginning, construction workers, subcontractors and labor pools like Madden Industrial Contractors. Subcontractors are specialty trade contractors that you can delegate certain portions of the work you intend to perform. Make sure they have appropriate experience, properly licensed, bonded and insured. It is important in order to maintain future long term relationships that pay dividend to pay your subcontractors on time and treat them well.
- Employees - Bring lots of flexibility and responsibility. Flexible because you can allocate resources as need and scheduling is in your direct control. Responsibility because someone has too process payroll and the payroll tax returns. You need to manage cash flow to have money for their wages, benefits you offer and any applicable state and federal withholding taxes related to their wages, such as Social Security, income tax withholding, workers Compensation and unemployment insurance. In addition you may be responsible for employee benefits such as vacation pay, health insurance, and contributions to a retirement program. With labor Pools they take care of all of that and you pay a fixed cost per hour or whatever you negotiate with the service. Check with your construction attorney and your liability insurance agent to make certain you are covered.
Find A Mentor - Someone who has been were you want to go and can guide you. We would like to be that person for you. Fill out the form on the right or call Sharie 206-361-3950 or email email@example.com and schedule your no charge one-hour consultation
For Construction Company Owners who do not need the full power of QuickBooks for contractors and want 24/7 online access we offer Xero Accounting Online and we have custom setup for construction companies. Click Here For More.
This Is One More Example of how Fast Easy Accounting is helping construction company owners just like you put more money in the bank to operate and grow your construction company. Construction accounting is not rocket science; it is a lot harder than that and a lot more valuable to people like you and me so stop missing out! Call Sharie 206-361-3950 or firstname.lastname@example.org and schedule your No Charge One Hour Consultation
Profitable Contractors and Construction Company owners have known about the value of outsourced bookkeeping services and contractor coaching services like ours for a long time and now you know about it too!
We Scan Your Receipts And Invoices link the appropriate transactions to QuickBooks or Xero Accounting Online depending on the construction accounting service you are using and provide ongoing Cloud Based Contractors Bookkeeping Services by accountants who understand construction.
Thinking About Outsourcing Your Contractors Bookkeeping Services To Save Time And Money?
Need Help Now? Call Sharie 206-361-3950 email@example.com
We Are Xero Accounting Experts Specializing In Construction Bookkeeping Services
About The Author:
Randal DeHart, PMP, QPA is the co-founder of Business Consulting And Accounting in Lynnwood Washington. He is the leading expert in outsourced construction bookkeeping and accounting services for small construction companies across the USA. He is experienced as a Contractor, Project Management Professional, Construction Accountant, Intuit ProAdvisor, QuickBooks For Contractors Expert and Xero Accounting Specialist. This combination of experience and skill sets provides a unique perspective which allows him to see the world through the eyes of a contractor, Project Manager, Accountant and construction accountant. This quadruple understanding is what sets him apart from other Intuit ProAdvisors and Xero accountants to the benefit of all of the construction contractors he serves across the USA. Visit http://www.fasteasyaccounting.com/randal-dehart/ to learn more.
Our Co-Founder Randal DeHart - Is a Certified PMP (Project Management Professional) with several years of construction project management experience. His expertise is construction accounting systems engineering and process development. His exhaustive study of several leading experts including the work of Dr. W. Edward Deming, Michael Gerber, Walter A. Shewhart, James Lewis and dozens of others was the foundation upon which our Construction Bookkeeping System is based and continues to evolve and improve. Check out our Contractor Success Map Podcast on iTunes and Follow Randal on Google+
This is the end of Construction Company Start-Up Tips For Contractors Across The U.S.A Part 2 of 3