Assuming you had $100,000 in annual fixed costs, you would need a daily contribution margin of $385 to stay afloat. This chart shows that the sample 20-day $22,000 deck job falls short of that goal, but that raising the markup or shortening the schedule — or doing both — could make the difference.
Assuming you had $100,000 in annual fixed costs, you would need a daily contribution margin of $385 to stay afloat. This chart shows that the sample 20-day $22,000 deck job falls short of that goal, but that raising the markup or shortening the schedule — or doing both — could make the difference.

Last month we talked about determining your break-even point for the year and calculating the overall “contribution margin” of every job. Knowing how many jobs you need to complete and collect for on a monthly and quarterly basis is critical to meeting the financial goals you set for the period. But how do you know on a week-by-week — or even day-by-day — basis whether your jobs are moving you toward the goal line?

To answer that question, I need to introduce a new benchmark: Time. Yes, you’re going to need to establish a schedule for every job. For those of you doing smaller jobs or handyman-type work, your “schedule” might be nothing more than an educated guess — jotted down on a wall calendar — about the number of days required. As you move into...

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