Client Story 3:
Unlocking Profit with Accurate Job Costing
1. The Challenge
An $8 million construction company faced shrinking margins despite healthy revenue. The owner couldn’t understand why some jobs looked profitable while others consistently lost money.
Each project manager tracked costs differently: some used spreadsheets, others QuickBooks categories, and a few didn’t record expenses until the job was complete. Labor, materials, and subcontractor costs were lumped together, making it nearly impossible to see where money was being lost.
The core issue: no accurate job costing.
Without it, the company couldn’t:
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Confirm whether bids were realistic.
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Identify which jobs produced the best returns.
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Hold crews accountable for overruns.
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Forecast cash flow with confidence.
2. Our Approach
At The CFO Contractor, we mapped how costs were being captured across the business and built a system designed for accuracy and speed. We:
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Standardize cost codes across labor, materials, equipment, and subcontractors.
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Integrated job costing into the accounting system so every expense hit the right project in real time.
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Trained project managers to track and review costs weekly.
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Built reporting dashboards so the owner could instantly see whether each project was ahead or behind budget.
3. The Breakthrough
The first test came with a $600K commercial renovation. By week three, the new system flagged that labor hours were trending 15% over budget. Instead of waiting until the end of the job to find out, the project manager made mid-course corrections: reassigning crews, negotiating change orders, and tightening overtime.
4. The Result
Within six months of implementing accurate job costing:
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The company discovered that smaller residential jobs averaged only 2% profit, while mid-size commercial projects consistently earned 10%+.
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The owner shifted bidding strategy to focus on higher-margin projects.
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Cash flow improved as overruns were caught early.
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Leadership gained confidence in their numbers, making decisions based on facts—not guesswork.
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That $600K renovation, which would have ended in a loss, closed with a 7% profit margin.
5. The CFO Contractor Difference
Revenue alone doesn’t build a strong construction company—profit does. Profit comes from knowing, down to the dollar, how each job is performing.
Accurate job costing isn’t just an accounting tool; it’s a competitive advantage.
👉 If your projects run without clear visibility into profitability until months later, let’s talk.