Why Use SmartContractor?
Why Should I Use SmartContractor?
There are many reasons:
- Cost Tracking and Analysis
In the end of the day, the most important thing in your business is whether you are making or losing money, and why. Some contractors operate like this:
- Make a bid.
- Do the work.
- Deposit the final payment; check bank balance. If I lost money, ask for more.
This is about the best you can do if you don't have a way of accurately anticipating and tracking your costs. The disadvantage of this approach is a difficult customer relationship, and more important, you don't know where you are making or losing money, so you can't do any better estimating the next job. So the cycle continues... unless you use SmartContractor.
SmartContractor allows you to:
- Itemize job estimates,
- Track actual item costs (and time),
- Report difference between estimated and actual costs - by item or summarized by category - for one job or for all jobs.
This way, you know exactly where you are making or losing money. But you can only do this if you itemize your job estimates.
- The Customer Relationship
After accurate job costing and accounting, the biggest challenge in the contract construction business is the relationship with your customer. Most problems are always result from a lack of communication and documentation of the definition of the job - especially when changes are made after work on the job has begun. And this always happens.
The only way to eliminate these problems is to use clear documentation throughout the entire job process. This includes:
- Job Estimate
A big source of problems is that customers make changes to the job after it has been bid and started. The only way to prevent problems is to have clear documentation of the job estimate before it starts, and as changes are made. SmartContractor makes this very easy.
- Customer Documents
It's not enough to just provide a customer with a contract. There are a number of other documents customers need in the course of a construction project. SmartContractor automatically generates these by merging job and customer data into your customized documents to produce all of the customer documentation needed, including..
- Draw Schedule
A Draw Schedule provides a clear definition of when payment for each element of a job must be made.
- Allowance Schedule
An Allowance Schedule provides clear documentation of the dollar amount allowed for allowance items. This lets the customer know exactly how much they can spend, item by item, while shopping for their materials, appliances, and fixtures.
- Allowance Variance Reporting
After the customer has selected their allowance items, you must be able to document which items varied from the allowance amount, and by how much. The Over Allowance Report provides this.
- Change Orders
When changes to the job inevitably occur, change orders clearly define what has been changed. This includes a listing of the job items that have been changed, what they have been changed to, and the net change in customer costs that resulted from the change.
- Extra Purchases
An Extra Purchases document lists purchases made for the job that are in addition to what was estimated. This is needed for Cost Plus jobs where the customer needs a record of every job cost, and whether it was estimated or not.
- Job Progress
As the job progresses, you need to keep the customer updated on your progress to let them know you are on schedule and on budget. SmartContractor allows you to automatically post updated customer job information on your web site so that customers can have access to it around the clock. This keeps them feeling warm and fuzzy, and frees your time so you can get the work done.
- Invoices or Draw Requests
SmartContractor automatically generates and prints customer invoices, or standard (AIA G702/G703 form) draw requests for submission to banks for draws on construction loans.
- Payment Tracking
SmartContractor allows you to enter and track customer payments.
- Job Recap; Final Payment Documentation
When a job is completed, you need to provide your customer with a full accounting of the job in order to get a final payment. While this is normally a lengthy and time consuming task, the Job Recap report makes it a snap. This report pulls together information from the entire job to provide a complete job accounting summary and final balance due.
- Draw Schedule
SmartContractor provides these tools to help you manage your relationship with your customer. SmartContractor also helps you manage...
- Job Estimate
Another challenge in the contract construction business is the process of purchasing job materials. There are a number of problems:
- Competitive Sourcing
Who has the time, or the means, to get prices from multiple vendors or subcontractors? Unless there is a way to do this automatically, it's just not feasible. Construction materials vendors know this, and can only be expected to take advantage of it. But SmartContractor allows you to:
- Request vendor price quotes. These can be emailed, and the quoted prices returned by email, and automatically imported into SmartContractor.
- Select a preferred vendor for specific items within a job. This allows you to automatically assign vendors for products used in a job when you create the estimate. Once you get more proce quotes from separate vendors, you can easily compare the prices and change the preferred vendor or any or all products.
- Print Purchase Orders. Purchase Orders automatically combine job materials to be purchased from a particular vendor, and display and total the vendor's quoted prices.
- Purchasing Schedule - When To Purchase Materials?
If you're building a custom home for example, you've got a thousand different items to purchase over the course of the project. From a management perspective, it would be easier to order all of the materials at the same time, but from a cash flow perspective, that's impossible. So what do you do? You have to develop a schedule for the job, and then figure out when to order materials as they will be needed to keep the project on schedule, and to work within your scheduled cash flow. You also have to figure out when to order materials so that they will be received in time for scheduled installation based on their individual lead times. That's a lot of figuring (how do you guys do it?).
With SmartContractor, once you have an estimate, the program can automatically generate purchase orders based on each items's "scheduled order date". The scheduled order date is the date on which an item must be ordered to be received in time for scheduled installation, including the item's order lead time.
- Competitive Sourcing
- Job Scheduling
Another huge issue in construction project management is scheduling. Most contractors don't bother using software to manage their project schedules because 1) it takes too long to set up, and 2) the schedule is always changing. SmartContractor automatically generates a schedule from your estimate (based on a pre-defined model of work activity sequence and duration), and allows you to easily modify the schedule in a graphic Gantt-style interface.
The problems that arise between you and your customer also happen between you and your Subcontractor, and for the same reasons. Again, the only way to avoid this is by thoroughly documenting the details of the job being Subcontracted. When you do, SmartContractor allows you to print a Subcontract Quote Request, in which all of the details of the Subcontract job are clearly defined. If the Subcontractor asks for more money after the job is completed, you can refer back to the quote request and compare that to the work completed.
SmartContractor provides you with a full suite of tools to help you get the most efficient use of your employees time: Scheduling, Work Orders, Time Tracking, etc.
To summarize, using SmartContractor is smart because it allows you to...
- Estimate faster and more accurately,
- Obtain competitive prices from vendors, and optimize your materials purchasing process,
- Better manage your customer relationships,
- Better manage your subcontracts, and
- Analyze profit and loss to improve estimating.