“How does cash flow look this month?” Answering that question is an ongoing challenge for many small, mid-sized, and custom home builders.
Making sure employee spending, invoices, change orders, materials, payroll, and a myriad of other expenses across multiple projects and contracts square up with income is seldom easy. A firm handle on the company’s day-to-day financial health can be a difference maker in preserving margins or confidently taking on new work.
Custom home builder Brad Leavitt is a good example. His Scottsdale, Ariz. firm, AFT Construction, is currently juggling 14 under-construction projects, with another 28 in the design pipeline, ranging in value from $4 million to $20 million. “They’re incredibly complex projects, some take two years to design and another three years to build,” Leavitt said.
Adding to that complexity is the tightest credit environment since the Great Recession. Maintaining a clear-eyed view of cash flow in a challenging economy has seldom been more important to home building leaders. It’s a big reason why Leavitt is moving rapidly to simplify and automate his finances.
Keep It Simple
“Years ago, we started with manual tracking, Excel spreadsheets, and third-party software,” Leavitt said. “We ran the business with six or seven different programs.” This patchwork approach failed to provide the support the AFT Construction team needed. “To get to the next level, we have to be more efficient,” the builder said.
It’s a common industry challenge reports Andres Ricaurte, general manager of financial services for Buildertrend, the industry’s leading business management platform.
“At a certain point, spreadsheets don’t cut it,” Ricaurte said. “There are many fine single-purpose software solutions out there, perhaps a hundred or more. Stitching together disparate applications creates a Frankenstein solution that doesn’t help real-time insight. Can you be truly certain you’re making money on a particular job?”
Hiding in Plain Sight
Leavitt’s answer was hiding in plain sight. A longtime Buildertrend user – “Every person in the company uses it, it’s our operating system” – Leavitt transitioned all business accounting over to Buildertrend’s financial services and tools for a seamless, 360-degree view of all projects in one spot.
“It’s all about simplicity. We’re a cost-plus contractor. Clients can audit us, so we’re super open with our books,” Leavitt said.
Ricaurte cites other reasons why the shift is on to a single-source solution:
• Builder Trust. Today Buildertrend is the industry’s de facto gold standard, with more than 1 million users worldwide. “Construction pros know how to run their business. We are teaching them how to find efficiencies by digitizing, centralizing data, organizing jobs, and improving financial logistics,” Ricaurte said. “We’re as equally invested in financial workflows as we are in job coordination.”
• Hyper-Focused. Think of Buildertrend as Pay-Pal just for the construction industry: It’s the only financial suite wholly focused on residential construction, offering the payment, insurance, accounting, and financing tools builders need. These tools include Buildertrend Wallet, an integrated banking feature that empowers builders to control and track employee spending all in one place, and an exclusive material rebates program, Buildertrend Purchasing.
• Investment Protection. Buildertrend integrates with popular accounting applications QuickBooks and Xero. Data seamlessly flows between systems, eliminating double entry and ensuring information is accurate and available in one place.
• Automated Simplicity. No more paper receipts, per diems, double entries, uninvoiced costs like parking fines, replacement tools, or gasoline. Every expense is easily captured and accounted for.
Today it’s good to know construction professionals finally have a seamless, trusted system to connect project activity with the financial processes and world they operate in. No cobbled-together solutions, no end-of-month surprises. Just the on-demand insight builders need to boost the company’s financial well-being.
Learn more about how to simplify your business for more efficiency and financial control.