The numbers that really matter for anyone in construction

Problem: you work 250 days a year, invoice hundreds of thousands of euros, and in December you discover you earned less than you thought.

Solution: the right numbers checked every week, in under 30 minutes, with automatic alerts when something goes off track.

Result: you stop driving blind and start making decisions before problems become emergencies.

"What on earth is written in this balance sheet?"

How many times have you had the feeling of "What on earth is written in this balance sheet? How did I end up at 31 December in this state?" I have heard this phrase dozens of times. And every time, the person saying it had worked all year without stopping, invoiced well, yet did not know whether they had made or lost money.

Without a weekly report, you are driving blind. And when you drive blind, you only notice problems when you crash into them.

You do not need 50 indicators. Let us look at the ones that matter and how to read them.

1. Monthly revenue vs budget

How much you have invoiced this month, compared to what you had planned. If by mid-March you are at 30% of the monthly budget, you have a problem. If you are at 70%, you are doing well. The point is knowing it now, not at month-end when you can no longer do anything about it.

An important data point: if your break-even falls in November, it means you have only one month to generate profit. With a monthly budget you see it immediately and can react.

Those who do not have a budget are working blind. They do not know if 100.000 € of revenue in a month is a lot or a little, because there is no reference point.

2. Contribution margin and CM%

Invoicing a lot does not mean earning well. The contribution margin (CM) tells you what is left after subtracting variable costs: material, direct labour, transport, equipment hire, waste.

Same revenue, but Job B leaves 7500 € more in your pocket. If you do not calculate the CM, you treat these two jobs as equal. They are not.

Also calculate the CM per hour worked. If the hourly CM is lower than your structural hourly cost, that job is losing you money. As a business owner admitted during a consultation: "You still do not have this figure? I never calculated it because I never saw it as something fundamental." The number you have never calculated is often the one that changes your perspective.

3. EBITDA

The CM tells you how individual jobs are performing. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation) tells you how the whole business is doing. It is what is left after also paying fixed costs: rent, office staff salaries, insurance, leasing.

Why does it matter so much? Because the value of your business is calculated on EBITDA.

If your annual EBITDA is 100.000 €, the difference between 3x and 6x is 300.000 €. This is not theory, it is the price at which you sell the business when you decide to stop.

I have seen businesses with impressive revenues and pitiful EBITDA. And smaller businesses, with half the revenue, producing double the operating margin. Revenue alone means nothing.

BAU Gest

Controlla i tuoi numeri con BAU Gest

BAU Gest ti mostra fatturato vs budget, margine di contribuzione per commessa, EBITDA, cassa prevista e conversione. Tutto in un report settimanale automatico con alert quando qualcosa va fuori target.

See how it works

Swiss
Made

BAU Gest

Net margin24,2%

Active jobs8

Hours deviation+12%

4. Current cash and projected cash at 8 weeks

You can have beautiful margins on paper and not have the money to pay suppliers on the 15th of the month. It happens more often than you think.

The fourth number is actually two: how much cash you have today, and how much you will have in 8 weeks considering expected collections and payments due.

The 8-week cash plan is the key tool. If you want to go deeper on how to build it, we cover it in detail in the article on cash flow.

Updating the cash plan every week takes 10 minutes. Not doing it can cost you 10.000 € in interest on unplanned overdrafts, or worse, the trust of a supplier who blocks your material.

5. Conversion rate and conversion time

Last number, but worth gold: how many contracts you close relative to quotes issued, and how long it takes from first contact to signature.

A window and door company admitted it openly: "In recent years I have never run checks to see how many quotes were done in a quarter." Without that data, you do not know if your sales process is working or burning time.

If you issue 20 quotes per month and close 4, your conversion rate is 20%. If the average time from contact to signature is 45 days, you know that today's open negotiations will (maybe) become contracts in a month and a half. If conversion drops from 25% to 15% in a quarter, you see it straight away and can figure out why.

How to organise the check

Automatic alerts make the difference: margin below target, hours worked exceeding 50% then 80% of the budget. When an alert fires, you still have time to act. Without alerts, you find out when the job is done.

The cost of not checking

Those who do not check these numbers do not lose money once. They lose it every week, every month, for years. I have seen businesses discover in December that they had been running at a loss for 11 months. They had invoiced, they had sites, they had employees busy. But nobody had stopped to look at whether those jobs were producing margin or burning cash.

The worst thing is not losing money. The worst thing is not knowing you are losing it and continuing to do the same things thinking they work.

Thirty minutes a week. It is not a luxury for big companies. It is the minimum for anyone who wants to know where they are heading before they get there.

If you want to do this exercise together, book 30 minutes with us. We look at your numbers, build the weekly report and see where you are leaving margin on the table. The initial consultation is free and with no obligation.