In this transcript from a video by Steven J Wick & Associates PC in Fort Collins, Steve Wick discusses practical strategies for pricing contractor jobs effectively. He explains how subcontractors can calculate a bottom line profit for Fort Collins subcontractors by understanding industry markup standards, properly bidding jobs, tracking labor and materials, and implementing training systems for employees. This video emphasizes the importance of knowing your worth, avoiding job cost mistakes, and using tools like QuickBooks to manage job expenses as your business grows.

Please note, this video does not constitute legal or financial advice, and we recommend consulting a CPA for guidance specific to your situation.

00:00:00 – Understanding Industry Markup and Profit Margins

this one guy that I had he did not really fully understand industry standards of markup [Music] what you need to make in order to make a bottom line profit of an amount or it’s just like well I work this hard and therefore I just make money and that’s not always how it goes and some of those other costs he was aware of but it’s like okay do we eat some of this markup or do we pass it all on to the customer or do we use our same Market percentage on everything and even make more money

00:00:56 – Bidding Correctly and Covering Expenses

in this particular client he was willing to eat some of those cost adjustments but not all of them [Music] foreign [Music] places where I started with him is like between your labor and your materials after you bid that you should be making you know X percent for him it was right around at least 40 percent to cover the other expenses that he had so just that one little piece was was a kind of a watershed moment where he started actually bidding jobs correctly and was okay to lose jobs and just make the profits that he needed to

00:01:52 – Managing the Bottom Line and Training Challenges

make so he could make his bottom line and be a happier person but after that it was just kind of keeping up and it’s like okay he’s got all these I said the wiring and some of those other costs [Music] thank you if I could narrow it down to any business subcontractor electrician whatever it’s that plus the fact that they’re out of their element because they don’t know how to manage 10 people or 15 people for an electrician do you have a training system for them for your premises from somebody new coming on

00:02:37 – Implementing a Training System

what is the training system usually it’s well I just throw them out there and we’ll figure it out I would suggest something like YouTube or something like that for training videos to set it up within your company to do those types of training pieces so that people understand quality most the time they’re like they’re one person QuickBooks or just one or two and then they start and it’s fine and they can just keep up with it but they don’t really care about Job costs and they

00:03:11 – Resetting QuickBooks and Tracking Value

start growing and then QuickBooks oftentimes I’m just gonna be admit this that oftentimes we end up having to go in and reset up this file for them [Music] thank you foreign [Music] where are you most beneficial to your company or are you sitting there chasing the dimes and you know and and how much are you worth per hour which is a lot master electrician worth and we pull those dollars up and show them this is what you should be worth and this is what you should be building so if you’re

00:04:10 – Leveraging Labor and Understanding Worth

doing that job whatever it is if you can pay somebody else to do that job for half of what your salary is isn’t it worth it so that you can go do the more higher cost money so that’s the that’s the whole idea is like getting them to understand what their worth is foreign [Laughter] most subcontractors at least the businesses that we work with like the opportunity to be face to face okay yes we do have clients that they operate throughout the country but all of their home offices are here in Colorado and so

00:04:54 – Face-to-Face Interaction and Margin Planning

talk to them locally and and really show them and then I can you know yes we have zoom and those types of features that yes I can see their face but virtually all of them say it’s just so much nicer I can walk in I can see you we can talk work through things and when I really need that face to face you don’t really know them look out front try and look out further than just today and keep them thinking about you know that direction that they’re going to you know make sure that their margins like I said

00:05:26 – Avoiding Job Cost Mistakes

is correct and there’s a lot of different things that play into it if let’s say somebody gets into a job and then they just totally mess it up for whatever reason and so it has to be you have to send somebody out to redo it well now you’re having to play pay more labor you can’t charge your end customer you have to pay more labor and probably more materials on the job and all of a sudden you’ve lost it you just got to make sure that the employees understand to get this this is what the budget is

00:05:57 – Preparing Materials and Completing Jobs Efficiently

this is how you’re going to do it make sure they have all their pieces and all of their materials that they need when they go out to do a job so that it’s there so that they’re not just standing around waiting for whatever part or something they have to finish it up foreign [Music]

Conclusion – Bottom Line Profit for Fort Collins Subcontractors

Properly pricing jobs is essential for maintaining a bottom line profit for Fort Collins subcontractors. By understanding industry markup standards, accurately bidding labor and materials, implementing internal training systems, and leveraging tools like QuickBooks, subcontractors can ensure they are not leaving money on the table. Consistently tracking expenses and managing team performance reduces mistakes and improves profitability. For guidance tailored to your business, contact a CPA who can help you apply these principles to your specific situation.