Every remodeler battles job cost overruns. They are universal to this business and are the single most common reason remodelers are not profitable.
Ninety percent of overruns will be in the labor category. That’s not surprising since estimating labor is an act of judgment and the actual job performance is subject to so many variables.
If you can get your labor estimates and actuals to match up within 2 %, you have done the hardest work to make your company profitable. Here are some tips on solving job cost overruns in labor and subcontractor costs:
Excerpted from The Remodeler’s Guide to Making and Managing Money, by Linda W. Case.