Is construction job costing software worth the investment?

Introduction:

As a construction business owner or manager, you are likely always looking for ways to streamline your operations and improve your bottom line. One tool that has proven to be immensely useful in the construction industry is job costing software.

In this blog, we will learn the benefits of using job costing software in the construction industry and help you decide whether your business is worth the investment. We will discuss how this software can help you manage project costs, track expenses, and improve overall project efficiency.

So, whether you are just starting in the construction industry or have been in business for years, this blog will provide valuable insights on this important topic. So, let's dive in and explore whether job costing software is worth the investment for your construction business.

What is construction job costing?

Job costing in construction is a process of accurately tracking and allocating all the costs associated with a specific job. There are two main reasons to use job costing. These are:

• To determine the profitability of a job, and
• To precisely identify the key areas from where you are losing or gaining money.

To implement job costing effectively, it is essential to monitor the costs of the job in great detail, breaking them down into five key categories. These categories include labor cost, material cost, equipment cost, subcontractor fees, and other miscellaneous expenses.

By carefully tracking and analysing costs in these categories, you can understand the financial performance of a specific job. This information can help you make informed decisions about future projects, and you can adjust your strategies to maximise profitability.

What is construction job costing software?

Construction job cost software is a tool that's designed to make life easier for construction firms and builders. Basically, it automates accounting for construction tasks related to tracking the cost of labor, materials, and overheads used in the production of goods or services.

By using job-cost software, contractors can get a clear view of their financial investment and avoid costly mistakes like cost overruns or project losses. Job-cost software comes packed with some awesome features, like payroll management, materials tracking, change orders, and purchase orders.

With payroll, contractors can track labor costs and make sure that everyone is getting paid what they're owed. Materials tracking helps to manage inventory and order supplies so you don't run out of anything mid-project. Change orders and purchase orders are also key features that allow contractors to document changes to a project's scope or budget and track expenses related to materials, equipment, and supplies.

It is no exaggeration to say construction project management software is an indispensable tool that empowers construction firms and builders to manage their projects more effectively and improve profitability. If you're in the construction industry, it's highly recommended that you explore this game-changing software. Trust us, it's an investment that pays off in spades.

List of top job costing software Australia

There are several job costing software widely used in Australia, some of them are:

• MYOB advanced:

  MYOB Advanced offers a cloud-based job costing module that is popular among businesses in Australia. The software includes features such as time tracking, project management, and cost tracking.

• Xero projects:

  Xero Projects is a cloud-based job costing software that integrates with Xero accounting software. It offers features such as project tracking, time tracking, and expense tracking.

• WorkflowMax:

  WorkflowMax is a cloud-based project management and job costing software that is widely used in Australia. The software offers features such as time tracking, project management, and invoicing.

• simPRO:

  simPRO is a cloud-based job management software that is designed for businesses in the trade and service industries. The software offers features such as job costing, project management, and scheduling.

• QuickBooks online:

  QuickBooks Online offers a job costing feature that allows businesses to track costs and expenses associated with specific jobs. The software also includes time tracking and project management features.

Know the benefits of using construction job cost software

In recent years, the construction industry has seen some amazing technological advancements, one of the most valuable being the availability of job cost software. This tool is a game-changer for construction professionals as it helps them to create more accurate project forecasts, which in turn enables companies to streamline their projects and achieve their goals more efficiently.

As these software systems continue to evolve, they are becoming more intuitive and user-friendly, allowing construction professionals to select task-specific programs and personalised platforms to create estimates in a much smoother and quicker manner.

Nowadays, more and more businesses realise that job costing software is better than traditional methods like manual calculations or spreadsheets. This software is widely adopted by online bookkeepers working with construction firms to manage their finances. So, let's explore in greater detail the substantial benefits that can be obtained by utilising this software.

• Build reputation

  Job costing software solutions can significantly enhance a company's reputation in the construction sector by providing a transparent and efficient way of managing costs and resources. The software allows for accurate project tracking and detailed cost analysis, providing clients with a clear understanding of the project's financials.

  This level of transparency demonstrates the company's commitment to building trust with clients and establishing a reputation as a dependable and trustworthy partner. Additionally, using job costing software showcases a company's willingness to invest in the latest technology, conveying a message of innovation and forward-thinking, further enhancing its reputation in the industry.

• Minimise the accountant’s workload

  Accountants are a vital part of any business, but the job can become tedious and time-consuming. Job cost software provides a range of features that can help minimise the workload for construction accountants and improve their efficiency. Features such as automatically-generated job costing reports, automated invoicing, and built-in accounting systems allow accountants to enter data quickly and finish tasks with ease.

  Additionally, these systems can provide automated or real-time notifications and alerts to notify accountants when certain tasks need to be addressed. This allows them to prioritise and focus on the most important tasks that require immediate attention. Furthermore, these systems also provide accountants with access to easily search and organized financial data, making it easier to identify trends or outliers in the numbers, which can aid in making sound financial decisions.

• Improved accuracy

  Being accurate is very important. If you make small mistakes, it can cause big problems later on. This can hurt your relationships with clients and even put your business in danger. Sometimes the cost of materials can suddenly go up and down a lot. This happens more and more these days because of inflation, market fluctuations and supply shortages.

  Construction management software helps project managers stay on budget by keeping track of all the changing costs and materials in real time so that nothing is overlooked or mistaken. This means fewer headaches for everyone involved, including your clients, who can rest assured that their projects are being managed with the utmost accuracy and attention to detail.

• Employee performance:

  Employees can be a great asset to your business, but they also need to be managed properly in order for them to perform optimally. Job cost software helps managers keep tabs on employee performance and make sure that they are working towards the same goals as the rest of the team. This allows managers to quickly identify any issues that could be holding back an employee's performance and take corrective action, giving them a stronger team overall.

  Additionally, the software can be used to measure the performance of different teams or individuals against each other, helping managers determine who is performing the best and reward them accordingly. This helps create a positive work environment that encourages employees to work together as a team and strive for excellence.

• Streamline procurement process

  The procurement process can be complicated and time-consuming. Job costing software simplifies the entire process, making it easier and faster to purchase materials. This software typically includes features such as supplier management, automated purchase orders, and invoicing. These features help you to streamline the procurement process, allowing you to order materials quickly and efficiently.

  Additionally, the software often provides better visibility into the entire supply chain, allowing you to better manage inventory levels and track shipments. This helps ensure that the right materials are delivered on time and at the right price. With the help of this software, you can even effortlessly compare the prices provided by various suppliers, enabling you to choose the most suitable option for your project and obtain the best value for your money.

• User-friendly

  The convenience and user-friendliness of modern job cost software are quite remarkable. All you need to do is enter some data and information, and the software takes care of the rest. Although the design may vary among different brands, the software provides an overall perspective and allows for easy input of necessary changes and improvements. To make construction estimating easier, the software automatically reformats data into a manageable format. This makes complex calculations simple and easy to understand, saving time and effort in the long run.

  Furthermore, with the use of modern construction software, you have the option to communicate and edit projects virtually rather than in-person. This means that everyone involved in the project can stay up-to-date with the progress and make changes as needed. Additionally, the software allows you to save past projects to use as templates for future ones. This ensures that all relevant information is available and easily accessible

• Exhibit professionalism

  Nothing is more important for a construction company than knowing their employees are representing the company in a professional manner. Job cost software helps to ensure this is the case. This software helps to keep track of employees' hours, job completion times and any customer feedback. It also keeps a record of all the tasks that were completed around a property and can be used to ensure that proper safety procedures have been followed.

  By monitoring these activities, the company can make sure its employees are adhering to their standards and representing the company in a professional manner and with integrity. This helps to ensure that the company is always working at its best.

  Another way that software helps with professionalism is to keep records of all materials used. This ensures that the company is using only the highest quality materials on each job and that their customers are getting the best product for their money.

• Integration

  Another benefit of job costing software is the ability to integrate your work with other key software solutions for your company, enabling you to handle a wider range of tasks efficiently. This includes integrating job costing with accounting software for construction, payroll systems, customer relationship management (CRM) tools, project management platforms, and other business applications that are commonly used in the workplace. It also allows for smooth data transfer between systems, making it easier to access and report the information you need in a timely manner.

  Furthermore, integration with third-party apps can provide additional helpful insights into project performance and progress. These integrations unlock the potential of your data, giving you more insight into how things are progressing so that you can take action when needed. With the right integration capabilities, the software is a powerful tool to help you manage your ongoing and future projects with greater efficiency.

Conclusion

Construction job costing is an essential part of a successful business. It is important that the appropriate and correct costs are considered to ensure the job's financial and operational sustainability. Construction job costing solutions can help you be more organised, efficient, and accurate in that process. Not only does it help streamline the job costing process, but it will also save you precious time with invoicing and collecting payments.

Furthermore, it can handle more complex tasks, such as forecasting budgets and tracking hours and materials easily through simple clicks. For busy contractors struggling with data entry and reports, the software provides an automated solution to make things easier while maintaining accuracy at all times.

If you want to be competitive in the marketplace, investing in good construction software could be key to ensuring success for your business. So, don't wait any longer; take the necessary steps to improve your job costing processes today. To learn more about how job cost software helps you in your construction business, contact us today to schedule a call with one of our experts.