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Is your job costing software a waste of your time? Here are 7 tips to ensure it is helping your business.

job costing software
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Is your job costing software a waste of your time? Here are 7 tips to ensure it is helping your business.

In the big bad world of job costing software, there are many, many options available to you. When considering if a job costing program is the right fit for your business, make sure you consider the following. 

Recording revenue against the job.  

At the very least, you need a system that allows you to invoice against your jobs, so you can see how much money you charged and made on each project.

Record costs against a job.

Recording costs against jobs, such as subcontractor claims, supplier invoices, materials, labour, overheads, etc., allows you to see the total cost of your job. With the revenue figure, as above, you can also see the profit that you’ve made.

Record costs against a cost code, phase or activity. 

Cost codes are a level below the job. Job cost code visibility allows you to see where you’ve spent money on the job in more detail. They are precisely the same costs that you’re recording against the job in point 1, but you’re just recording a little more detail; for example, when entering an invoice for concreting, you would select the job and then select the ‘Concrete’ cost code.

Record estimates and budgets. 

If you’re recording your costs to jobs and cost codes, that will only tell you what you’ve spent. Useful, but it could be better. If you also record your budgets, you can then compare them to your costs to see where you went over budget. You can then analyse why. Some reasons are unavoidable, e.g. rain delays. Some, however, can be solved; for example, if you determine that your original estimate was too low, you can fix it for all future projects.

Record variations.

Variations are essential to keep track of, whether it be extra work that your client has requested or additional expenses that you didn’t foresee. Most importantly, if it costs you more, you need to identify why. You might be able to charge the customer for those additional costs, but if not, you want to avoid it for the next project.

Record Forecasts. 

With jobs, cost codes and budgets, you can see exactly how much you’ve spent and where you went wrong. The problem is that this is after the fact. The work is complete, and you’ve received the invoice. If you can also forecast your expected costs, you might be able to see whether you are going over budget before it actually happens. Even a month of forewarning allows you to think about how you can resolve the problem, or at the very least, tells you that you may need some extra cash next month.

Project Lifespan Visibility.

Finally, you will need all of these things over the entire life of the job. Most accounting systems can’t do this, as they show the amounts over a financial year. If your project starts in one year and finishes in the next, you simply can not get a clear picture of your total job.

The right job costing software for your business will be able to do these and more features that will enable more visibility and more transparent decision making for your business.  

Give thrive a call today on 1300 868 474, and let’s find the right solution for your business. We listen, we understand, and we find solutions.