4 Steps to Ensure You Make Profit on Your Projects

by | May 13, 2023 | Tips and Tricks

In our latest, laugh-out-loud installment of Bizvalet Academy, we dove headfirst into the wacky world of crafting winning estimates and cozied up with only the crème de la crème of clients (Class A, thank you very much). Today, ladies and gentlemen, we shall embark on an uproarious journey into quoting like a pro and squeezing every last penny of profit from your projects! Let’s get ready to break-even, back cost, and belly laugh our way to success.

You see, my fine friends, in the madcap arena of contracting, the name of the game is profits – and lots of ’em! To forget this crucial fact would be like showing up to a black-tie event in your bathrobe (though we all know that would make one heck of an entrance). Don’t fret, we’re here to help you strategize, analyze, and hypnotize your way to a victorious quotation.

Imagine, if you will, any riveting sports match. Each player has their place, the coach has their plan, and someone in the stands undoubtedly brought a hilarious, oversized foam finger. Success on the field or court comes from knowing the game inside and out, just like we’re striving to do in our contracting escapades.

Now, let’s slide on our sweatbands and dive into some critical information to ensure your quotes have your competition running scared – or at least scratching their heads in bewildered admiration:

1. Analyze your past “games” (jobs) – what worked, what didn’t, and what can be hilariously retold at your next company gathering?

2. Calculate your break-even margin – the point where the champagne and confetti cannons can officially be brought out.

3. Keep a keen eye on back costing – these numbers hold the secrets to your future successes (or face-palming fiascos).

4. Act like a confident coach – use your newfound knowledge to make bold, strategic moves that keep your opponents quaking in their cleats.

Master these steps, dear reader, and watch as your quotes become more profitable than ever before – and your competition wonders how you  contracting world.

1. Mark it, break it, but don’t fake it!

project analysis

In the sports world, breaking even means scoring a tie, but we’re aiming for the victory here, people!

  • To bring home that sweet, sweet profit (more than big ol’ 0 on the scoreboard), you’ve got to cover your yearly direct costs and overheads.

  • Know your break-even margin, and you’ll never walk onto a quote field without the proper padding. You may be working a 30% markup on your quotes, thinking it’s pure profit, but if your break-even is 20%, you’re only snagging a 10% gross win.

  • You’d have to sell triple the amount of work to reach your target! Don’t fumble, friends – use tools like Bizvalet’s break-even calculator for real-time info.

2. Quote like a champ, get paid like a champ!

project analysis

To keep those profits rolling in, you’ve got to think beyond the obvious price tags. Let’s talk hidden costs!

  • Fuel, travel time, material pick-up, tidying up job sites, contending with those pesky subcontractors (can’t live with ’em, can’t live without ’em, am I right?) – all these factors play into your pricing.

  • Once you’ve stepped up to the plate with an accurate quote, make sure your clients can pay you however their heart desires using a platform like Wisetack.

  • Stick to cash or check, and you’re stuck in the minor leagues. A study by IPSOS found that customers lean towards contractors with diverse payment options. Keep it flexible, and you’ll stay ahead of the game.  Now, batter up!

3. Back costing: A comedic investigation of where the moolah went!

project analysis

So, you’ve had a few jobs in the past – who hasn’t, right? And maybe, just maybe, you’ve made a teensy weensy mistake or two along the way.

  • Did some of those jobs spring a leak in the ol’ profit department? Perhaps you accidentally put the Three Stooges in charge of a project, and suddenly an extra week of work was needed to fix their, ahem, “masterpiece.”

  • Or maybe you pinky swore to a client that their project would be done in no time, only to find out your subcontractors were on a leisurely stroll through Snailville. Then there’s the classic “Oopsie Daisy” move of underestimating materials and leaving your crew playing the world’s most stressful game of Tetris.

  • Fear not, my friend! There’s still hope for you and your trusty bookkeeper to dive into that back costing pool and swim through the sea of numbers until you find your long-lost profits.

4. Stand out like a peacock in a penguin suit: Differentiating from the competition

project analysis

In a world filled with contractors, one company dared to be… different.” Sounds like a riveting movie trailer, doesn’t it?

  • That’s because in today’s fierce landscape, you’ve gotta be the sharpest tool in the shed to win those jobs and make it rain dollar bills.

How do you set yourself apart?

  • Dig into that contractor toolbox and pull out some unique services that’ll make your clients say, “Wowza!” Maybe you swoop in like a superhero and save the day with maintenance services after an installation. Who wouldn’t want a cape-wearing contractor at their beck and call?

The bottom line?

  • Be the contractor that not only nails a project, but also serves up some gourmet estimates with a side of pizzazz. Homeowners want to buy with confidence, and it’s your job to dazzle them with a smorgasbord of value-adding offers. Once you’ve got your profitable estimating recipe down, it’s just a matter of whipping up an invoice soufflé and serving it piping hot on a silver platter of success.