Aaron Mills’ Post

Understanding labor costs is essential for keeping your projects profitable, but figuring out the right compensation rates can be a complex task. If you're unsure whether you're overpaying, underpaying, or simply not pricing your labor effectively, we've got just the tool you need—a free Comp Rate Calculator designed to simplify your labor cost management. Here's how this tool can help you optimize your labor expenses and boost your bottom line: 1. Accurately Calculate Compensation Rates: Our Comp Rate Calculator helps you determine the precise compensation rates for your employees, taking into account factors like hourly wages, benefits, taxes, and overhead. By accurately calculating these rates, you can ensure that your labor costs are aligned with your project budgets and profitability goals. 2. Simplify Bid Preparation: When bidding on new projects, knowing your labor costs is crucial to submitting competitive and profitable bids. This calculator simplifies the process, giving you a clear picture of your labor expenses so you can price your bids accurately and confidently. 3. Control Overhead Costs: Labor costs are more than just wages—they include benefits, taxes, and other overhead expenses. The Comp Rate Calculator helps you factor in all these elements, giving you a comprehensive view of your true labor costs. This allows you to manage overhead more effectively and avoid unexpected expenses. 4. Improve Financial Planning: By regularly using the Comp Rate Calculator, you can monitor changes in labor costs and adjust your financial planning accordingly. This proactive approach helps you stay ahead of cost fluctuations, ensuring that your projects remain profitable even as expenses change. 5. Optimize Workforce Management: With a clear understanding of your labor costs, you can make more informed decisions about hiring, staffing levels, and workforce management. This tool helps you strike the right balance between labor costs and project needs, optimizing your workforce for maximum efficiency and profitability. Ready to take control of your labor costs and boost your profitability? Download our free Comp Rate Calculator today and start managing your compensation rates with confidence. Get your free Comp Rate Calculator now and start optimizing your labor costs for better project outcomes. #ConstructionIndustry #LaborCosts #CompensationRates #Profitability #BusinessGrowth #AaronMillsCFO #ConstructionBiz #FreeTools

🔍 Is Your Labor Allocation Accurate? Here's Why It Matters for Project and Product Profitability 💼 In construction and manufacturing, how you allocate labor costs can make or break project and product-level profitability. When labor isn’t allocated correctly—especially between direct (Cost of Sales/COGS) and indirect expenses—companies risk: 📉 Underestimating Project/Product Costs: Misallocating labor can distort the actual cost of a job or product, leading to misinformed pricing and budgeting. 🔍 Inaccurate Profit Margins: Direct labor costs should be assigned to COGS, where they can be directly matched with revenue, providing a clearer view of true profit margins. 💸 Reduced Competitive Edge: When labor is miscategorized, pricing decisions are less precise, impacting competitiveness and eroding profitability over time. By correctly allocating labor to COGS, businesses gain a precise understanding of what it takes to deliver each project or product, empowering leaders to make data-driven decisions about pricing, budgeting, and growth. 👉 Are you confident your labor allocation practices are providing an accurate picture of profitability? #Accounting #Construction #Manufacturing #LaborAllocation #Profitability #ProjectManagement

Confessions of a Cost Estimator: Counting Pennies & Derailing Dreams? Have you ever heard the saying, "Penny wise, pound foolish?" In mega-projects, it's more like, "Penny wise, multi-million pounds foolish!" As a cost estimator, I've seen firsthand how the obsessive hunt for micro-savings can throw a wrench into the gears of even the most well-oiled machines. Death by a Thousand Papercuts: While we're haggling over a 5% discount on office supplies, critical materials might be delayed, causing weeks of downtime and hundreds of thousands of hours of lost productivity. The Sunk Cost Fallacy on Steroids: Imagine nixing a £10,000 software upgrade that would streamline our entire workflow, only to spend £50,000 in overtime trying to do the same tasks manually. Missing the Forest for the Trees (Or the Bridge for the Bolts): It's easy to get tunnel vision on line-item expenses, but ignoring the bigger picture can lead to massive oversights in overall project scope and budgeting. The Bottom Line? Micromanagement of minor expenses can be a significant project killer. A balanced approach that prioritises strategic cost control is critical. After all, we're building bridges, not just balancing spreadsheets! #InfrastructureHumour #CostPlanning #BudgetQuest #InfrastructureAdventures #UnexpectedCosts #BudgetBuster Let's connect and share war stories! Have you ever seen a project go sideways due to excessive penny-pinching? What strategies have you found successful for maintaining a healthy balance between cost control and project progress? Let me know in the comments! 

Confessions of a Cost Estimator: Counting Pennies & Derailing Dreams? Have you ever heard the saying, "Penny wise, pound foolish?" In mega-projects, it's more like, "Penny wise, multi-million pounds foolish!" As a cost estimator, I've seen firsthand how the obsessive hunt for micro-savings can throw a wrench into the gears of even the most well-oiled machines. Death by a Thousand Papercuts: While we're haggling over a 5% discount on office supplies, critical materials might be delayed, causing weeks of downtime and hundreds of thousands of hours of lost productivity. The Sunk Cost Fallacy on Steroids: Imagine nixing a £10,000 software upgrade that would streamline our entire workflow, only to spend £50,000 in overtime trying to do the same tasks manually. Missing the Forest for the Trees (Or the Bridge for the Bolts): It's easy to get tunnel vision on line-item expenses, but ignoring the bigger picture can lead to massive oversights in overall project scope and budgeting. The Bottom Line? Micromanagement of minor expenses can be a significant project killer. A balanced approach that prioritises strategic cost control is critical. After all, we're building bridges, not just balancing spreadsheets! #InfrastructureHumour #CostPlanning #BudgetQuest #InfrastructureAdventures #UnexpectedCosts #BudgetBuster Let's connect and share war stories! Have you ever seen a project go sideways due to excessive penny-pinching? What strategies have you found successful for maintaining a healthy balance between cost control and project progress? Let me know in the comments! 

Confessions of a Cost Estimator: Counting Pennies & Derailing Dreams? Have you ever heard the saying, "Penny wise, pound foolish?" In mega-projects, it's more like, "Penny wise, multi-million pounds foolish!" As a cost estimator, I've seen firsthand how the obsessive hunt for micro-savings can throw a wrench into the gears of even the most well-oiled machines. Death by a Thousand Papercuts: While we're haggling over a 5% discount on office supplies, critical materials might be delayed, causing weeks of downtime and hundreds of thousands of hours of lost productivity. The Sunk Cost Fallacy on Steroids: Imagine nixing a £10,000 software upgrade that would streamline our entire workflow, only to spend £50,000 in overtime trying to do the same tasks manually. Missing the Forest for the Trees (Or the Bridge for the Bolts): It's easy to get tunnel vision on line-item expenses, but ignoring the bigger picture can lead to massive oversights in overall project scope and budgeting. The Bottom Line? Micromanagement of minor expenses can be a significant project killer. A balanced approach that prioritises strategic cost control is critical. After all, we're building bridges, not just balancing spreadsheets! #InfrastructureHumour #CostPlanning #BudgetQuest #InfrastructureAdventures #UnexpectedCosts #BudgetBuster Let's connect and share war stories! Have you ever seen a project go sideways due to excessive penny-pinching? What strategies have you found successful for maintaining a healthy balance between cost control and project progress? Let me know in the comments! 

I can relate to this as a past cost engineer.

A perfect summary. We often overlook how technological advances can provide a significant reduction in profits. Higher overheads effect every project overall and your bottom line net profits.

Understanding Labor Burden Rates: Boost Your Profit Margin ⠀⠀⠀⠀⠀⠀⠀⠀⠀ In this video, we detail the process of calculating labor costs for a supervisor over three days by incorporating burden rates and profit margins. By breaking down hourly rates, overhead, and profit calculations, the video provides a clear method to determine extended costs and unit prices for accurate budgeting and financial planning. ⠀⠀⠀⠀⠀⠀⠀⠀⠀ 00:00 Introduction to Supervisor Requirements 00:16 Calculating Burden Rate and True Cost 00:41 Unit Cost Formula Breakdown 01:08 Extended Cost Calculation 01:15 Overhead, Profit, and Final Pricing ⠀⠀⠀⠀⠀⠀⠀⠀⠀ 🔨 How to Estimate a Construction Project for Contractors (FREE TEMPLATE) 🏗️ ⠀⠀⠀⠀⠀⠀⠀⠀⠀ 📲 Download Free Template: https://lnkd.in/gTei8UF9 ⠀⠀⠀⠀⠀⠀⠀⠀⠀ #LaborBurden #Construction #Accounting #CostAccounting #Labor #LaborAndBurden #BusinessOverhead #ConstructionManagement #CostOfWork #DirectLaborBurden #BurdenedLabor #LaborBurdenPercentage #BurdenCosts #TrueCostOfLabour #LaborBurdenCalculator #LaborCosting #LaborBurdenCalculation #FullyBurdenedLaborRate #BurdenRateCalculation #EmployeeCostPricingAnalyzer #LaborBurdenWorksheet #LaborCost #NickPeret #CTO #FractionalCTO

After working with over 100 clients solving cash flow and expense tracking issues, I need you to know this is the #1 thing that is overlooked 👇🏽 Not tracking labor costs accurately. and it's costing you big time. Labor is often the biggest expense in a construction business, and when you’re not tracking those hours down to the minute, you’re losing money without even realizing it. One client came to me with a major cash flow issue. Turns out, labor hours were being mismanaged, and we found out he was overspending by thousands each month on projects labor compared to what he estimated. His guys were spending more time per project then what he expected and he never adjusted his budgets because he simply had no idea of this issue until we started tracking the hours by project. Once we dialed in his labor cost tracking, his profits went up, and the cash flow problem disappeared. Don’t let something as simple as labor tracking cost you more than it should. It’s an easy fix with a big impact. 💸

🚧 𝐊𝐞𝐲 𝐊𝐏𝐈𝐬 𝐂𝐨𝐧𝐬𝐭𝐫𝐮𝐜𝐭𝐢𝐨𝐧 𝐂𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬 𝐒𝐡𝐨𝐮𝐥𝐝 𝐓𝐫𝐚𝐜𝐤 𝐢𝐧 2025 🏗️ As we move into 2025, staying on top of the right metrics can make or break your construction business. Here are 5 essential KPIs every construction company should track to ensure profitability and efficiency: 1️⃣ Project Profitability: Track the difference between project revenue and total costs (including overhead). This helps identify your most profitable jobs and avoid cost overruns. 2️⃣ Labor Productivity: Measure revenue or output per labor hour. Efficient labor management is critical with rising wages and labor shortages. 3️⃣ WIP (Work in Progress) Analysis: Understand overbilling or underbilling on active projects. Accurate WIP reporting ensures healthy cash flow and prevents surprises. 4️⃣ Bid-to-Win Ratio: How many bids turn into actual projects? This KPI helps you refine your bidding process and focus on opportunities you’re most likely to win. 5️⃣ Equipment Utilization: Are your machines being used effectively? Maximize ROI on expensive equipment by tracking downtime and utilization rates. 💡 Pro Tip: Using software like Knowify or QuickBooks Online can simplify tracking these metrics and improve decision-making. 👉 Start 2025 strong by focusing on these KPIs! Need help setting up systems to track them? Let’s talk. #ConstructionAccounting #KPIs #ProjectProfitability #Knowify #ConstructionBusinessGrowth #ConstructionManagement #ConstructionIndustry #LaborProductivity #ConstructionTech #WIPAnalysis #BidToWin #EquipmentUtilization #BusinessOptimization #ZagzAccountingSolutions