Project Cost Tracking creates profit margins

Along with a general awareness of project costs, contractors need to be able to track the exact financial figures associated with a project.

The reasons are simple: Project cost tracking is how a company predicts what its margins will be, as well as confirming what those margins actually are. With accurate numbers in hand, trades can also manage efficiency of future projects—or determine which projects are money-losers that shouldn’t be repeated.

“Accurate tracking will show holes in effectiveness, efficiency, higher-than-average material costs or overages in labor,” says Vanessa Gonzales, co-owner and founder of Albuquerque Plumbing, Heating & Cooling Inc. and also a ServiceTitan employee. 

She notes that your budget for a project is set during the bidding process, but the actual numbers begin to populate once the job starts. 

Tracking project costs with ServiceTitan

Gonzales says ServiceTitan software is one solution for keeping an eye on your budget while a project is ongoing. 

Using customized fields, it’s possible to use the software to show how much of your budget is left, as well as the dollar amount of any variance. 

“You can make it as detailed as you need, break it down by department, phase of the project and where you stand on which phase has been billed,” she says. 

Gonzales points to two more examples that show the benefits of using ServiceTitan to track project costs.

“Tracking the budget outside of your software leaves more room for human error,” she says. “With ServiceTitan, you can make sure the latest version of the spreadsheet is being used by everyone.” 

Pro tips

Here are three points Gonzales says will help the project cost tracking system run smoothly:

• Review your numbers daily until the project is complete. This will allow you to make real time adjustments and keep your project on budget.  

• Make sure your ServiceTitan CSMs have turned this ServiceTitan feature on—it won’t work if it’s turned off. 

• You do not need to have progress billing turned on to use project job costing, but you can have progress billing turned on while using project costing. 

The Takeaway

Remember: It’s crucial for a project manager to know how they are progressing on a job, and keeping track of project costs is a major part of the task.

The budget may have been billed at a certain price point. Following along as the project progresses by using ServiceTitan can help manage costs that may not have been predictable during the bidding process.

As Gonzales says, accurate tracking can show the differences in predicted-versus-real costs and may allow a project manager to make course corrections along the way that could mean all the difference in terms of profit margin.