A job in Smart Contractor consists of any number of job items. Each job item can be a "group item" that contains any number of sub-items. Items in a job can be grouped and structured in any way. You can define a job with just a few summarized items, or you can break everything down to a detailed level.
For example, a job to remodel a master bath could contain just two items that would contain the cost for the entire job:
When job items are broken down this way, each item contains estimates for the materials and labor for that individual item. The cost of the whole job is calculated as the sum of all items in the job. This approach allows you to create an accurate estimate for the job, because you can get prices for each individual item, and because it is much easier to accurately estimate the time to complete individual job items instead of the job as a whole.
I've been doing this kind of work for a long time. I know how much these things cost. It takes a lot of time to break a job down like that. Why would I want to do that? What will that buy me?
Granted, defining a job on an itemized level will take some time at first (until you create some jobs that you can copy). But Smart Contractor does a lot more than just estimating, and everything Smart Contractor does is integrated with the job estimate. So, estimating a job on a detailed level gives a number of benefits:
The success of your business all comes down to whether you make or loose money. We all know contractors who operate like this:
Some contractors think that if they can just get big enough jobs, build big enough houses or enough of them at the same time, then the profit income will be high enough to offset, or compensate for weakness and discrepancies in accounting. The sad truth of that game is that while you can make more money when things go right, you can also loose more money when things go wrong. Unless your approach changes, doing more or larger jobs is only going to take you up to where there is further to fall.
But, if you define your job estimate by breaking it down to a detailed level, as demonstrated above, then...
For the same reason that estimating a job on a detailed level gives you accurate cost estimating and cost accounting, it also allows you to do a better job of scheduling the job.
If the job to remodel a master bath contained just two items:
Then the schedule for this job would have just two items:
There are a number of disadvantages to scheduling a job this way.
One of the big challenges in the contract construction business is your relationship with the customer. Many problems result from a lack of documentation of the job definition - what is included in the estimate - especially when changes are made after work has begun.
The only way to eliminate these problems is to use clear documentation throughout the entire job process, from planning, designing, construction, finishing and closing. This includes:
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 definition, and costs, before you begin. The more detailed the definition of the job in the beginning, the easier it will be to discuss any changes down the road.
A Draw Schedule provides a clear definition of when you expect payment for each job item as it is completed.
An Allowance Schedule provides clear documentation of allowance items, and of the dollar amount allowed for each. This lets the customer know exactly how much they can spend, item by item, in order to remain on budget. The Allowance Schedule also gives them the date by which each item must be ordered in order to be delivered at the job site in time for its scheduled installation.
After the customer has selected their allowance items, you must document which items varied from the allowance amount, and by how much. The Allowance Variance Report, and the Job Recap report provides this.
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.
Another challenge in the construction business is the process of purchasing materials. There are a number of problems:
Who has the time, or the means, to get prices from a number of vendors? 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 if you specify the materials needed for a job, on a detailed leve, then Smart Contractor allows you to:
Request vendor price quotes
The Create Quote Requests form allows you to generate price quote requests for specific products that can be mailed or emailed to your vendors. If the quoted prices are returned by email, they can be imported into Smart Contractor.
Purchase Orders automatically combine job materials to be purchased from a particular vendor, and display and total the vendor's quoted prices. Smart Contractor allows you to automatically generate purchase orders based on material order dates. Material order dates are based on the item's order lead time, and the date that they are needed at the job site.
The problems that arise between you and your customer also occur between you and your Subcontractor, and for the same reasons. Again, the only way to avoid this is by documenting the details of the job being subcontracted. When you do, Smart Contractor allows you to print a Subcontract Quote Request, in which all of the details of the subcontracted work 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.
To summarize, there are a number of reasons that you should break your job definition down to a detailed level. This allows you to...
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