ISSUE NO. 69

WEEKLY CFO BRIEF

A practical weekly field note from Basta CPA.

THIS WEEK'S STORY

Before you submit that public-works bid, check this number

Samy Basta, CPA

Here's a terrible way to win a job.

You estimate the project. Submit the bid. Win it.

Everybody is happy.

Then you discover you used the wrong prevailing wage rate.

California issues changes and corrections to prevailing wage determinations throughout the year. So the rate sitting in your estimating spreadsheet may not be the rate you should be using today.

And a small difference adds up fast.

Let's say you're off by just $5 an hour.

On 4,000 labor hours, that's $20,000.

There goes $20,000 of your margin - and the job hasn't even started.

That's why I wouldn't automatically use the labor rate from the last project just because "that's what we normally use."

Quick note from your CFO
​Before you chase the next bid, make sure the wage rate, fringes, payroll taxes, workers’ comp, and other labor costs reflect what you’ll actually pay. The goal isn't to win every job. It's to win the jobs you can actually make money on.

Book your free 15-minute call

— What I Would Check This Week

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•✓•

Before submitting your next public-works bid, have someone verify: Current wage rate + fringe benefits + payroll taxes + workers' comp + your other labor burden.

•✓•

Then multiply the fully burdened hourly rate by the estimated labor hours.

•✓•

Compare that number with what's actually sitting in your estimate.

•✓•

Five minutes checking the rate today can save you a painful conversation six months from now.

— Deep Dive

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01

Fix progress billing before it squeezes your plumbing business cash flow See how billing delays, retainage, and poorly timed invoices can leave profitable plumbing jobs short on cash when payroll and materials come due. ​Read more →​

02

Stop bookkeeping mistakes from hiding your construction profit Your books can look fine while job margins quietly slip, so learn which bookkeeping mistakes make it harder to see what your projects are really earning. ​Read more →​

03

Fix the accounting gaps that make electrical jobs harder to price Small issues with materials, labor, change orders, and job costing can quietly drain profit long before they show up on your P&L. ​Read more →​

Basta and Company

100 Pine Street, Suite 1250
San Francisco, CA 94111

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