The office side of the business is frequently unloved in construction. We like to joke that nobody ever got into construction so they could sit at a desk working on spreadsheets all day. Because construction guys would much rather be in the field, they often develop little workarounds to make the office side of things faster – but as with any workaround, they give up something in the process.
One of the most common business process workarounds we see with new Knowify clients is the elimination of formal invoicing. Rather than prepare an invoice, many contractors just email the client saying, “Can I pick up the check tomorrow?” – the expectation being that whatever was quoted at the outset is what the client should pay right now. Leaving aside that this process doesn’t work for jobs beyond a certain size (a few thousand dollars), it leaves a bad taste in the customer’s mouth… it makes the contractor seem disorganized, and lacking diligence. Here’s the thing though: an invoice isn’t just paperwork; it’s an opportunity for more client engagement! You’re not just a tradesmen anymore; you’re a business owner – happy, satisfied clients can refer you to friends, ESPECIALLY if you ASK THEM TO! Here’s what you should do: work with your Knowify rep to create a beautiful invoice template that makes it look like you’re really on top of your game, and that you take your interactions with your clients seriously. Then put at the bottom of the invoice an invitation for feedback (it’s important to gather feedback, even if it’s negative), and a request for referrals! You’ll be surprised by what you can get from your clients if you ask them the right way.
On the cost side of the equation, there’s a similar process that if not handled well can cost contractors money. Assuming your jobs are of a size that your suppliers won’t resist it, you should be sending out materials list for quote. We know that you have a great relationship with Joe @ XYZ Supplier, and that you’re certain that he’s giving you the best price. Reality: probably not. Negotiating materials prices up front can add multiple percentage points of margin to your business, and should not be overlooked. You wouldn’t overpay your employees or subcontractors, why should you overpay for materials? But once you have your quote, you need to make sure you’re paying the quoted prices! Suppliers can be disorganized, too, especially during busy times of the year. If someone in your office doesn’t have a quick and easy way to match the invoiced prices with the quoted prices, chances are that at some point you’ll end up paying “standard” prices rather than the quoted prices just due to administrative error. Knowify can help: you can use our POs to create the Request for Quote, or, once you’ve received prices back (usually in spreadsheet form), you can upload them quickly into the PO builder. When the vendor bill arrives, it’s a snap to reconcile the two… and if there are errors, you’ll catch them right away! It’s a tiny bit more effort for a lot of potential money – definitely worth the investment!