Case studies / Contracting
Case studyJob costing for a regional contractor
A regional contractor running dozens of concurrent jobs moved job budgets, subcontractor claims and progress invoicing into Business Central, seeing overruns early rather than at completion.
Overview
A regional building and civil engineering contractor delivering schools, healthcare buildings, commercial fit-outs and infrastructure works for public and private clients. It employs site managers, a small commercial team and a central finance function.
Scale. About 40 concurrent jobs, each with its own subcontractors, site store and programme, ranging from a few weeks of fit-out to multi-year new builds.
The challenge
On a construction job, the gap between the cost you expect and the cost you discover can be the whole margin. For this contractor, the discovery usually came at completion.
Job costs were tracked in spreadsheets kept by each quantity surveyor. Cost codes differed from job to job, commitments were noted when someone remembered and actual costs arrived from the finance system weeks after they were incurred.
Subcontractor claims arrived late and in many formats. Each had to be checked against the order, measured against progress, adjusted for retention and approved, and the process often took longer than the payment terms allowed.
Overruns were seen only at completion. Without a current view of committed and actual cost against budget, site managers and commercial staff could not tell whether a job was drifting until the final account was being prepared.
Progress invoicing to clients was irregular. Valuations depended on the quantity surveyor's workload, and cash flow suffered when applications slipped by a month.
Site managers had little time for administration. Anything that needed them to sit at a desk at the end of a long day would be done late, if at all.
The solution
Every job in Business Central has a budget broken down by cost code. Purchase orders and subcontracts create commitments against it, and invoices, timesheets and stores issues record actual cost, so committed and actual cost are always visible against budget.
Subcontractor billing handles applications, measured values, retention and payment notices. Claims are recorded against the subcontract, checked against progress and approved within the agreed limits, and retention is tracked through to release.
Purchasing and site stores mean materials are ordered against the job and issued from site stock with a record. Over-ordering and materials moving between jobs without a trace are much easier to spot.
Progress invoicing produces client applications from the job's valuation, including variations and retention. Finance sees what is due and when.
Site managers enter timesheets and approve deliveries on a mobile app. It takes minutes, and the data reaches the job cost the same day.
The engagement
- Five months
- Four specialists
- Cost codes and approval limits, Business Central jobs, subcontractor billing and retention, purchasing and site stores, progress invoicing and finance, a site timesheet app, five integrations and a job-by-job rollout.
Integrations
- Site timesheet app
- Bank
- Document storage
- Payroll
- Reporting
How we delivered it
- 01
Agree codes and limits
Four weeks
We agreed a single set of cost codes and approval limits with site managers, quantity surveyors and finance, simple enough to use on site and detailed enough to show where money went.
- 02
Configure and build
Seven weeks
We configured jobs, subcontractor billing, purchasing and progress invoicing in Business Central and built a cost-to-budget view for each job, with a mobile app for site timesheets and receipts.
- 03
Migrate and train
Four weeks
Open jobs were migrated with budgets, commitments and costs to date, reconciled with each quantity surveyor. Site teams were trained on site, on their phones, in under an hour.
- 04
Job-by-job rollout
Seven weeks
Jobs moved across one at a time, starting with new jobs and then bringing live ones over at their next valuation date.
Results
- Earlier visibility of cost overruns
- Faster subcontractor claim processing
- Monthly progress invoicing on every job
- Same-day site data from mobile entry
Overruns are now seen earlier and acted on. Monthly cost reviews compare committed and actual cost against budget, and commercial staff raise variations or change approach while there is still time.
Subcontractor claims are processed faster. Payment notices go out on time, relationships with key subcontractors have improved and disputes about retention are rarer.
Progress invoicing has become routine. Applications go to clients every month on every job, and cash flow is steadier as a result.
Because site entry was simple and mobile, data arrives on time. Site managers who had resisted earlier systems now use the app daily, because it saves them a trip back to the office.
Finance has also benefited. Payroll draws on approved site timesheets, documents sit with the job they relate to, and month-end reporting shows the whole portfolio of jobs on one page.
If it had needed a laptop, my site managers would have done it on Friday night, if at all. On a phone, it happens before they leave site.
What made the difference
Site managers needed simple mobile entry or data arrived late.
