Most contractors we meet know their revenue to the dollar. Fewer can tell us what they kept last year, by type of work, after overhead. That second number pays you, funds the next truck and sets what your company is worth.
We hear "more sales will fix it" all the time. It's an incomplete thought. Revenue that doesn't turn into profit makes the company bigger and harder to run without making it stronger. If the bottleneck in your company sits somewhere else, more sales only stack more work in front of it.
Make, spend, keep
Every business has three numbers. What you make. What you spend. What you keep.
Owners watch the first because it's easy to see. Backlog is up, the board is full, the phones are ringing. The other two take work to see in a construction company. Costs land on different jobs at different times, billing runs behind the work, and the bank balance moves for reasons that have little to do with this month's profit.
When our team looks at a company, we want to know how every dollar is performing. What's making you money and what's costing you money. Once that's clear, decisions about hiring, pricing and which work to chase get much easier to make. It's the question a good CFO is already asking. Our job is to make sure the whole leadership team can see the answer every week.
Where contractors lose what they earned
The money usually leaks in the same few places.
- Fade. The margin at closeout comes in under the margin you bid. If you only check at the end of the job, you find out too late to fix it.
- Change orders. Extra work gets done in the field and written up late, or never. An unbilled change order is margin you earned and gave away.
- One big bucket. When every job is costed together, you can't tell which types of work, customers or crews make money. You keep chasing work that looks good on the top line.
- Overhead creep. You add a project manager, an estimator, another truck. Each one made sense. Nobody went back to check whether margin grew with them.
- Cash stuck in the process. Slow billing, retainage and loose collections can leave you profitable on paper and tight on cash.
A revenue report hides every one of these. What you keep shows all of them. Notice how many of them sit in the last link of the chain, collecting the money, and how often that link slows down because the authority to price, bill and collect was never clearly assigned.
We start where an investor would
We approach every company the way we'd approach investing in it. Financial diligence comes first. Then the front of the funnel, where your work comes from. Then throughput, meaning how sales and management turn leads into profitable jobs. Then the team doing the work.
Finance goes first because it tells us where to look. If one type of work carries the company and another loses money every time, that changes what we fix first. It also sets a baseline. Our Growth Map ends with a baseline scorecard built on your real numbers, and everything after gets measured against it.
Put the numbers on a weekly scorecard
A weekly scorecard is a short list of numbers your leadership team reviews every week, in the same order. It tells everyone on the leadership team where the company stands, in real time, without anyone having to ask. It's one of the first parts of the management ecosystem that goes in with True Living OS.
The right numbers depend on your trade and how you're set up. For contractors in this range they often include some of these.
- Cash on hand, and receivables past 60 days
- Backlog, and the margin in it
- Bids out, bids won and hit rate
- Gross margin on jobs closed this month against what was bid
- Change orders pending and change orders billed
- Billing sent on schedule
Your CFO, controller or bookkeeper owns the numbers and has them ready before the leadership team meets, every week. With your accounting system connected, an AI agent can gather most of them, so finance spends its time on what the numbers mean instead of collecting them. If a number can't be pulled weekly, that tells you something about your systems too.
Your leaders look at the numbers every week. The monthly business review looks at the trend. When a number moves the wrong way, one person owns fixing it.
What you keep includes what you own
There's one more number, and owners rarely measure it. What the company itself is worth.
A company whose profit depends on any one person's hours is a job that pays well. A company that makes money on a system, with leaders who run it, is an asset an investor would pay for. That's why we score company value when we start and again a year in. The same work that frees the CEO's time also builds what you own.
We won't promise a valuation or an exit date. We will make sure you can see the numbers that drive both.
If you want the whole leadership team seeing what the company keeps, every week, apply to work with us, and we'll start with what your numbers are telling you.
Michael Peluso founded True Living, whose team installs True Living OS, a simple operating system with AI built in, so established companies and their leadership teams get an easier way to grow. He owns and operates construction businesses.