You own an electrical, HVAC, or plumbing company.
So you know what type of business you’re running, right? Maybe not.
One question I like to ask contractors is how much of their work is construction and installation versus service, because those might fall under the same company name but require two very different ways of running the business.
Service vs construction businesses
Take an electrical contractor.
On the construction side, you might have a crew working on a project for days, weeks, or months. The job was quoted ahead of time, materials were ordered, labor was estimated, and you’re tracking the job against that original estimate.
Service is different.
Your technicians might complete several calls in one day. Someone needs to schedule and dispatch them. Customers expect quick communication. Work needs to be documented, invoiced, and collected quickly.
You’re still doing electrical work, but operationally, you’re running a different type of business.
What changes in your business when you add more service work?
Let’s say your company has traditionally focused on installation work, but service calls are becoming a bigger part of the business.
Now you need to think about things like:
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- Who is answering and scheduling calls?
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- How are technicians being dispatched?
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- How many calls can each technician complete in a day?
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- How quickly is completed work getting invoiced?
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- Does your software work for service as well as construction?
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- Can you tell how the service side is performing compared with installation work?
If you keep running the company exactly the same way, your systems won’t give you the information you need to grow and service customers.
Your software needs to match your construction business
This is also why I don’t think contractors should choose construction software just because another contractor likes it.
A custom home builder, an electrical contractor doing large installation projects, and an HVAC company with several service technicians have different needs.
One might need strong project management and job costing. Another might care more about scheduling, dispatching, service agreements, and getting invoices out quickly.
Before choosing software, you need to understand the business you’re actually trying to build.
What percentage of your business is service?
If you haven’t looked at this recently, start there. How much of your revenue comes from service versus construction or installation work?
Has that changed over the last few years? Have your people, processes, software, and accounting changed with it?
A company that was 90% construction five years ago might look very different today if service now represents 40% of its work. Your systems need to catch up with the company you’ve become.
At Craftsmen CPAs, we work specifically with construction and trade businesses. That means we understand that how an electrical, HVAC, plumbing, or construction company operates affects how its accounting needs to work, too.
If your business has changed but the systems behind it haven’t, get in touch. We can help you figure out where the gaps are and narrow down the list of systems you should be evaluating.
It’s about more than the numbers and jobs; we can also help you understand the software that will work best for your business. Sound good to you? Let’s talk.
