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When it comes to operations, the construction industry is always one of the riskiest. This is mainly because the cost of a project is estimated on the original architectural plan. However, as the project goes on, things often change, and so do the economic conditions. A lot of times, the project needs alterations, and the design may end up changing.

Many construction company owners run into one problem: they quote a customer a price based on the initial plan for the project. Once the workers get started, there are so many issues that they could run into that could raise the cost. This is why all companies can benefit from a construction industry CFO.

The Trouble With Creating Your Quote

Customers always want a price quote before they hire a construction company. After all, construction work is a significant investment, and they want to make sure they have the funds to cover it. If a construction company gives them a quote for the project, they are expected to stay within those means. However, there’s always the chance parts of the project may need to change.

This is where things could get tricky for construction company owners. If you go over the expected budget for the projects, then you could lose profits. Many construction companies rely on their reputation within their community and word-of-mouth recommendations to book jobs.

If a company quotes customers one price but then charges them a lot more once the project is complete, they cost themselves in the long run. An unhappy customer is more likely to share their experiences in a review online.

When other people search for a company to hire for work they need done and see these reviews, they will be under the impression that the company isn’t honest.

How A CFO Can Help

Chief financial officers can change how construction companies handle their finances. If you notice that the quotes you give at the start of a project are much different than the finished results, you need a construction industry CFO to guide you. An experienced CFO can provide a more accurate forecast of a project’s budget before completion.

Many construction company owners have noticed a significant change in their profits since hiring a CFO. It has given them a better idea of the company’s billings and collections and the anticipated cash flow. Most construction industry CFOs are trained to serve all sub-sectors of the construction industry.

An experienced CFO will also make running the financial aspects of the business a lot easier for the owner. Many companies view their CFO as a trusted business advisor. After all, their goal is to help your construction company see more profits. Some of the services you can expect from construction industry CFOs are:

• Balance sheets

• Annual budget and financial business plan

• Profit and loss statement

• Earnings forecast

• Cash flow forecast

• Gain and fade analysis

• Comparison reports; more