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Building a Construction Budget That Works (and Sticks) 

A strong construction budget does more than outline expected costs. It sets the foundation for decision making, helps manage cash flow, and gives contractors a clear map for navigating the complexities of a project. Yet even well-prepared budgets can fall apart once work begins if they are not supported by systems that keep them …

A strong construction budget does more than outline expected costs. It sets the foundation for decision making, helps manage cash flow, and gives contractors a clear map for navigating the complexities of a project. Yet even well-prepared budgets can fall apart once work begins if they are not supported by systems that keep them active and up to date. 

A budget that works and sticks is one that adapts to real conditions on site while still guiding project performance. Building this kind of budget requires thoughtful planning, reliable data, and consistent oversight throughout the life of the job. 

Start With Clear Scope and Detailed Estimates 

Budgets often struggle not because of unexpected events, but because the original assumptions were incomplete. A clear scope is essential for building a realistic budget. Contractors should ensure that all labor, materials, equipment, and subcontractor needs are fully defined at the estimating stage. 

Detailed estimates help contractors: 

  • Set accurate expectations for cost and timeline 
  • Identify risks that may require contingency planning 
  • Ensure that all cost categories are represented in the budget 

The stronger the estimate, the stronger the budget that follows. 

Break the Budget Into Manageable Cost Categories 

A budget becomes more useful when contractors can see how each part of the project is performing. Breaking the budget into cost codes or categories makes it easier to track progress and identify concerns early. 

For example, budgets may be organized by: 

  • Labor 
  • Materials 
  • Equipment 
  • Subcontractors 
  • Permits and professional services 

Clear structure makes it possible to compare budgeted costs to actual results throughout the project. 

Build a Realistic Contingency 

Every construction project faces surprises. Unknown site conditions, material price changes, and schedule delays can create additional cost. A contingency helps protect the budget by preparing for these uncertainties. 

The size of the contingency depends on project complexity, but it should always be: 

  • Large enough to cover unexpected costs 
  • Separate from the main budget 
  • Reviewed periodically as the project evolves 

A thoughtful contingency allows contractors to respond to issues without jeopardizing financial stability. 

Use Job Costing to Keep the Budget on Track 

Job costing is one of the most effective tools for ensuring a budget stays accurate after the work begins. When actual costs are assigned correctly and recorded promptly, contractors can see how closely the project aligns with the budget at any moment. 

Consistent job costing supports: 

  • Early detection of variances 
  • Better communication between office and field staff 
  • Stronger forecasting 
  • More accurate billing and revenue recognition 

Budgets remain useful only when they reflect real conditions, and job costing provides the information needed to keep them current. 

Review and Adjust the Budget Throughout the Job 

Construction work rarely follows a straight line from start to finish. As the project progresses, contractors should review budget performance regularly and update projections based on new information. These reviews help identify trends and allow for adjustments before problems grow. 

Common triggers for budget updates include: 

  • Change orders 
  • Shifts in labor productivity 
  • Changes in material pricing 
  • Weather delays or scheduling changes 

A flexible approach helps keep the budget relevant and reliable. 

Strengthen Communication Between Project Teams 

A budget will not stick unless everyone understands their role in maintaining it. Project managers, field supervisors, subcontractors, and accounting staff all influence cost performance. Regular communication promotes accountability and keeps the entire team aligned with the financial goals of the project. 

Meetings that connect financial reporting with field updates help ensure that the budget reflects actual activity. 

Use Historical Data to Build Better Budgets 

Completed projects offer valuable insight into how future budgets should be structured. Reviewing past performance helps contractors understand where estimates have been accurate and where they have consistently fallen short. 

Historical data can strengthen new budgets by guiding: 

  • Labor productivity expectations 
  • Material quantity estimates 
  • Subcontractor pricing assumptions 
  • Contingency planning 

This continuous improvement process builds stronger, more reliable budgets over time. 

Creating Budgets That Support Long-Term Success 

A construction budget that works and sticks is one that evolves with the project while still providing structure and clarity. With strong estimating, reliable job costing, consistent adjustments, and clear communication, contractors can build budgets that support both day-to-day decisions and long-term profitability. 

At DBC, we help construction companies build budgeting processes that strengthen financial stability and support confident project planning. If you would like guidance on improving your budgeting approach, our team is ready to help.

Financial Questions Every Hospitality Owner Should Ask Before Opening Another Location

Opening a second location is an exciting step.It often signals that the first location is performing well, demand is strong, and there is confidence in the concept. At the same time, expansion introduces a different level of financial complexity.What works in one location does not always translate directly to another. Before moving forward, it …

Opening a second location is an exciting step.

It often signals that the first location is performing well, demand is strong, and there is confidence in the concept. At the same time, expansion introduces a different level of financial complexity.

What works in one location does not always translate directly to another. Before moving forward, it is important to step back and evaluate whether the business is financially prepared to support that growth.

Is the First Location Truly Stable?

Consistent revenue is a good sign, but it is not the only indicator of readiness.

Owners should look at profitability over time, not just during peak seasons. Are margins holding steady? Is the business generating reliable cash flow after covering all expenses, including debt and owner distributions?

If performance fluctuates or relies heavily on specific periods, expansion may amplify those challenges rather than solve them.

Do You Have Enough Cash to Support the Build-out and Ramp-Up?

Opening a new location requires more than the initial investment.

There are upfront costs such as build-out, equipment, and staffing, followed by a ramp-up period where revenue may take time to stabilize.

Many businesses underestimate how long it takes for a new location to become self-sustaining. Having sufficient working capital to cover that gap is critical.

Without it, the original location may end up supporting the new one, creating strain across the entire business.

How Will This Impact Cash Flow?

Growth changes how cash moves through the business.

More locations mean more payroll, more vendors, and more operational expenses that need to be paid before revenue is collected.

Understanding how these timing differences will affect cash flow helps prevent surprises. It also allows owners to plan for periods where multiple locations may require support at the same time.

Are Your Systems and Processes Ready?

Financial success is closely tied to operational consistency.

Before expanding, it is important to evaluate whether systems are in place for reporting, inventory management, payroll, and scheduling. Gaps in these areas often become more noticeable as the business grows.

Strong systems make it easier to track performance across locations and identify issues early.

Can Your Current Team Support Another Location?

Expansion is not just a financial decision. It is also a people decision.

Do you have managers who can lead another location? Is there a plan for training, oversight, and maintaining service standards?

Hiring and developing the right team takes time and investment. Without the right structure, even a strong concept can struggle to deliver a consistent guest experience.

What Does Success Look Like for the New Location?

Before opening, it helps to define clear expectations.

What level of revenue is needed to break even? How long should it take to reach that point? What margins are realistic based on the new market and cost structure?

Setting these benchmarks allows owners to measure performance and make adjustments if needed.

Are You Prepared for Higher Fixed Costs?

A second location increases your fixed cost base.

Rent, insurance, utilities, and other expenses will not adjust quickly if revenue falls short. This makes it important to understand how much flexibility the business has to absorb those costs during slower periods.

Looking at fixed costs as a percentage of revenue across both locations can provide useful perspective.

Bringing It All Together

Opening another location can be a strong next step, but it requires more than confidence in the concept.

It requires a clear understanding of financial performance, cash flow, cost structure, and operational readiness.

Taking the time to ask the right questions upfront can help prevent unnecessary pressure later.

A Final Thought

Growth should strengthen the business, not strain it.

When expansion is supported by solid financial planning and realistic expectations, it becomes an opportunity to build something sustainable.

At DBC, we work with hospitality businesses to evaluate expansion decisions, model financial outcomes, and plan for long-term success. If you are considering another location, we are here to help you think through the details before you move forward.

Are Rising Costs Hurting Your Hospitality Business? Financial Strategies to Consider

Rising costs have become a constant pressure point for hospitality businesses. Labor is more expensive. Food and beverage costs are less predictable. Utilities, insurance, and vendor pricing continue to move upward. At the same time, pricing adjustments are not always easy to pass along to guests. For many owners, the result is the same. …

Rising costs have become a constant pressure point for hospitality businesses.

Labor is more expensive. Food and beverage costs are less predictable. Utilities, insurance, and vendor pricing continue to move upward. At the same time, pricing adjustments are not always easy to pass along to guests.

For many owners, the result is the same. Revenue may be steady or even growing, but margins feel tighter.

Managing this environment is not about reacting to every increase. It is about understanding where pressure is building and making thoughtful adjustments that protect long-term performance.

Where Cost Pressure Is Showing Up

Cost increases rarely come from one area. They tend to build gradually across multiple parts of the business.

Labor remains the most significant expense for most hospitality operations. Wage increases, turnover, and scheduling inefficiencies can quickly impact margins if not monitored consistently.

Cost of goods sold is also less stable than it once was. Supplier price changes, availability issues, and waste all contribute to higher and more variable costs.

Fixed expenses such as rent, insurance, and utilities continue to rise, often without any direct connection to revenue. These costs create a baseline that becomes more difficult to manage during slower periods.

Technology and service platforms have also added to the cost structure. While they support operations, overlapping systems or underutilized tools can quietly increase monthly expenses.

Why Small Increases Matter More Over Time

Individually, many of these changes may not seem significant. A slight increase in vendor pricing or a small shift in labor costs may feel manageable in isolation.

Over time, those changes compound.

Margins narrow. Cash flow becomes less predictable. Decisions feel more reactive.

This is often when business owners start to feel that the business is working harder without producing the same results.

Financial Strategies to Consider

Addressing rising costs does not require drastic changes. It starts with a clear view of how your numbers are behaving and where adjustments can have the most impact.

1. Review labor performance regularly.
Look beyond total payroll and focus on labor as a percentage of revenue. Compare scheduled hours to actual demand and identify patterns where staffing can be adjusted without affecting service.

2. Evaluate vendor relationships and pricing.
Regularly review supplier agreements and pricing trends. Even small adjustments or renegotiations can improve margins over time. It is also helpful to compare vendors periodically to ensure pricing remains competitive.

3. Monitor inventory and waste.
For food and beverage operations, tighter inventory controls can have a direct impact on profitability. Tracking usage, spoilage, and portion consistency helps reduce unnecessary loss.

4. Assess your cost structure.
Take a closer look at recurring expenses such as software, subscriptions, and service providers. Eliminating overlap or unused tools can reduce costs without affecting operations.

5. Align pricing with current costs.
Pricing decisions can be difficult, but they should reflect the current cost environment. Even modest adjustments, applied thoughtfully, can help protect margins without disrupting guest experience.

6. Strengthen cash flow awareness.
Rising costs often create timing pressure. Understanding when cash is coming in and going out helps avoid surprises and supports better day-to-day decision-making.

Taking a More Proactive Approach

The businesses that navigate rising costs most effectively are not reacting month to month. They are reviewing their numbers consistently and making small, informed adjustments along the way.

This approach allows for better control, fewer surprises, and more confidence in planning.

A Final Thought

Cost pressure is not going away, but it can be managed.

When you understand where your expenses are shifting and how they interact with revenue, you are in a better position to protect margins and make decisions that support long-term stability.

At DBC, we work with hospitality businesses to evaluate cost structure, improve reporting, and identify opportunities to operate more efficiently. If rising costs are starting to impact your business, we are here to help you take a closer look and plan your next steps.

How Hospitality Owners Can Plan for Growth Without Overextending

Growth is often the goal for hospitality business owners, but it comes with real pressure. Expanding too quickly or without a clear plan can strain cash flow, disrupt operations, and create unnecessary risk.Sustainable growth requires more than strong demand. It depends on thoughtful planning, financial discipline, and a clear understanding of how each decision …

Growth is often the goal for hospitality business owners, but it comes with real pressure. Expanding too quickly or without a clear plan can strain cash flow, disrupt operations, and create unnecessary risk.

Sustainable growth requires more than strong demand. It depends on thoughtful planning, financial discipline, and a clear understanding of how each decision affects the business as a whole.

Start With a Clear Financial Picture

Before making any growth decisions, it is important to understand your current financial position.

This includes:

  • Cash flow trends
  • Profit margins by location or service line
  • Debt obligations and repayment schedules
  • Seasonal fluctuations in revenue

A clear view of your financials helps determine what the business can realistically support.

Align Growth With Operational Capacity

Growth should match your ability to deliver consistent service.

For restaurants, this may mean evaluating kitchen capacity, staffing levels, and supplier relationships. For hotels, it may involve reviewing occupancy trends, staffing models, and guest experience standards.

Expanding without the operational foundation in place often leads to service breakdowns and increased costs.

Plan for Working Capital Needs

Growth often requires upfront investment. New locations, renovations, hiring, and inventory all require cash before revenue catches up.

Many businesses underestimate how much working capital they will need during this period.

Building a cash reserve or securing appropriate financing ahead of time helps reduce pressure as the business scales.

Evaluate Financing Options Carefully

Taking on debt or outside investment can support growth, but it also adds complexity.

Loan terms, repayment schedules, and interest costs all affect cash flow. Equity partnerships introduce additional considerations around control and long-term planning.

Understanding the full impact of financing decisions helps avoid surprises later.

Build a Realistic Timeline

Growth rarely happens as quickly as planned. Construction delays, hiring challenges, and market conditions can all affect timing.

A realistic timeline that includes flexibility allows the business to adjust without unnecessary stress.

Monitor Performance Closely

Once growth is underway, regular financial review becomes even more important.

Tracking key metrics such as labor percentages, cost of goods sold, and revenue per location helps identify issues early.

This allows owners to make adjustments before small problems become larger ones.

Avoid Common Growth Pitfalls

Some of the most common challenges include:

  • Expanding without sufficient cash reserves
  • Underestimating labor and operating costs
  • Relying on overly optimistic revenue projections
  • Stretching management too thin across locations

Being aware of these risks helps owners take a more measured approach towards growth.

Growing with DBC

Growth should support the long-term vision of the business, not create instability. When financial planning, operational readiness, and clear decision-making come together, growth becomes more manageable and sustainable.

At DBC, we work closely with hospitality business owners to evaluate growth opportunities through a financial and operational lens. Our team helps clients assess capital needs, understand the true cost of expansion, and build strategies that support measured, sustainable growth without overextending the business.

If you’re considering your next step, DBC is here to help you think it through and move forward with confidence.

Understanding Your Biggest Cost Drivers in Hospitality

Running a hospitality business means balancing a long list of moving parts. Revenue can shift daily, while expenses often remain steady or rise without much warning. For owners and operators, understanding where costs are coming from is one of the most important steps toward protecting margins and making informed decisions.Cost control in hospitality is …

Running a hospitality business means balancing a long list of moving parts. Revenue can shift daily, while expenses often remain steady or rise without much warning. For owners and operators, understanding where costs are coming from is one of the most important steps toward protecting margins and making informed decisions.

Cost control in hospitality is not about cutting corners. It is about gaining clarity, identifying patterns, and managing the areas that have the greatest impact on profitability.

Labor Costs

Labor is typically the largest expense for restaurants, hotels, and event-driven businesses. It is also one of the most complex to manage.

Scheduling needs change based on guest volume, seasonality, and unexpected demand. Overtime, shift premiums, and turnover can all increase costs quickly if not monitored closely.

Common challenges include:

  • Overstaffing during slower periods
  • Understaffing that leads to overtime or service issues
  • High turnover that increases hiring and training costs

A more structured approach to scheduling, along with regular review of labor percentages, helps maintain balance between service quality and cost control.

Cost of Goods Sold

For restaurants and food service operations, cost of goods sold plays a direct role in profitability. Even small fluctuations in food or beverage costs can affect margins.

Price changes from suppliers, waste, spoilage, and portion control all contribute to this category.

Clear inventory tracking and regular review of vendor pricing help keep these costs in line. Many operators benefit from comparing actual costs to expected margins on a consistent basis.

Occupancy and Fixed Costs

Rent, utilities, insurance, and other fixed expenses create a baseline that does not adjust easily with revenue.

In slower periods, these costs take up a larger percentage of income. In stronger periods, they may feel less significant, but they still impact long-term profitability.

Understanding how these costs behave relative to revenue helps owners make better decisions about pricing, expansion, and cost structure.

Technology and Systems

Technology has become an essential part of hospitality operations. Point-of-sale systems, reservation platforms, payroll systems, and inventory tools all play a role in daily operations.

While these tools improve efficiency, they also add recurring costs that can build over time.

Reviewing system usage, eliminating overlap, and ensuring integrations are working properly can help control unnecessary expenses.

Marketing and Guest Acquisition

Marketing costs can vary widely depending on the approach. Digital advertising, loyalty programs, third-party platforms, and promotions all require investment.

The key is understanding which efforts actually drive traffic and revenue.

Tracking return on investment and aligning marketing spend with business goals helps ensure resources are being used effectively.

Bringing It All Together

The most successful hospitality businesses do not focus on a single expense category. They look at how costs interact and how they shift over time.

Regular financial review, clear reporting, and consistent monitoring allow owners to respond quickly and make thoughtful adjustments.

When you understand your biggest cost drivers, you are better positioned to protect margins, improve operations, and plan with confidence.

At DBC, we work with hospitality businesses to identify cost patterns, improve reporting, and build financial clarity into day-to-day operations. If you would like a closer look at your cost structure, our team is here to help.

Employee Spotlight: Kipp Harper

Since joining De Boer, Baumann & Company in 2022 as an IT Support Specialist with DB&C NetWerks, Kipp Harper has become an essential part of the firm’s day-to-day operations. His work often happens behind the scenes, but the impact is felt across the entire organization. From troubleshooting issues to supporting new initiatives, Kipp helps …

Since joining De Boer, Baumann & Company in 2022 as an IT Support Specialist with DB&C NetWerks, Kipp Harper has become an essential part of the firm’s day-to-day operations. His work often happens behind the scenes, but the impact is felt across the entire organization. From troubleshooting issues to supporting new initiatives, Kipp helps ensure everything runs smoothly so the team can stay focused on serving clients.

Kipp’s role spans software, hardware, and network support, along with providing service and consulting for external IT clients. His ability to navigate both internal and client-facing needs brings a practical, solutions-oriented approach to every situation. Whether responding to immediate technical challenges or helping implement long-term improvements, Kipp approaches his work with consistency and a clear focus on keeping systems reliable and efficient.

Kipp was drawn to IT by the rapid growth and opportunity within the field. Recognizing early on that technology would continue to evolve and shape how businesses operate, he pursued a path that allows him to stay engaged in a dynamic, ever-changing environment. That mindset continues to show in the way he approaches his work today.

Outside of the office, Kipp enjoys making the most of warmer weather by spending time outdoors with his dog, often hiking or camping. He also brings a strong sense of service to his community, having served as a part-time Firefighter/EMT over the past several years, an accomplishment he is especially proud of.

Kipp’s steady presence and willingness to step in wherever needed make him a valued member of the team. We’re proud to spotlight Kipp and the role he plays in supporting both our people and our clients every day.

Best Practices for Board Financial Oversight 

In not-for-profit organizations, the board of directors plays a vital role in guiding mission, strategy, and accountability. One of the most important responsibilities a board holds is ensuring sound financial oversight. Strong financial governance not only protects the organization’s assets but also builds trust with donors, grantors, and the community. When board members understand their …

In not-for-profit organizations, the board of directors plays a vital role in guiding mission, strategy, and accountability. One of the most important responsibilities a board holds is ensuring sound financial oversight. Strong financial governance not only protects the organization’s assets but also builds trust with donors, grantors, and the community. 

When board members understand their financial duties and actively engage in oversight, they help create an organization that is transparent, compliant, and positioned for long-term sustainability. 

Understanding the Board’s Financial Role 

Board members serve as stewards of the organization’s resources. Their primary financial responsibilities include approving budgets, monitoring financial performance, and ensuring that appropriate controls are in place to prevent misuse of funds. 

Effective financial oversight involves: 

  • Reviewing financial statements regularly and asking clarifying questions  
  • Ensuring compliance with regulatory and donor requirements  
  • Overseeing internal controls and risk management practices  
  • Supporting long-term financial planning and sustainability  

While management handles day-to-day financial operations, the board’s role is to provide governance, accountability, and a big-picture perspective. 

Key Elements of Strong Financial Oversight 
  1. Review Financial Statements Regularly
    Board members should receive and review financial reports such as balance sheets, income statements, and budget-to-actual comparisons on a consistent basis. Look for trends, variances, and potential red flags. Clear,timely reporting ensures that the board can make informed decisions and respond proactively to financial challenges. 
  2. Maintainan Active Finance Committee 
    A dedicated finance committee can help the board fulfill its oversight responsibilities more effectively. This committee should work closely with management to review budgets, monitor cash flow, and assess financial policies before presenting recommendations to the full board. 
  3. Approve Realistic Budgets
    The board shouldparticipate in developing and approving the annual budget to ensure alignment with the organization’s mission and strategic goals. A well-structured budget balances program priorities with operational needs and includes contingency planning for unexpected expenses. 
  4. Ensure Proper Internal Controls
    Strong internal controls protect the organization from errors, fraud, and mismanagement. The board should confirm that key controls are in place such as segregation of duties, authorization procedures, and financial reviews and that they are tested periodically for effectiveness.
  5. Monitor Cash Flow and Reserves
    Cash flow management is essential for financial stability. The board should review cash flow projections and understand how reserves are being managed.Maintaining appropriate reserves provides flexibility and security, especially during periods of funding uncertainty. 
  6. Oversee Audits and Reviews
    Boardsare responsible for engaging independent auditors and reviewing audit results. This process offers valuable insights into the organization’s financial health and the strength of its internal controls. The board should also ensure that management addresses any recommendations identified in the audit report. 
  7. Support Transparency and Accountability
    Transparency in financial reporting builds trust among donors, staff, and the community. Boards should ensure that financial information is communicated clearly and accurately in annual reports, IRS Form 990 filings, and other public disclosures.
Encouraging Financial Literacy Among Board Members 

Not every board member will have a financial background, but every member should understand the basics of not-for-profit finance. Providing regular training on reading financial statements, interpreting budgets, and understanding compliance requirements equips the board to fulfill its oversight duties confidently. 

Encourage open dialogue during board meetings, creating a space where members feel comfortable asking questions and seeking clarification. A board that is engaged and informed contributes meaningfully to the organization’s financial integrity. 

Building a Culture of Financial Stewardship 

Financial oversight is more than a procedural duty. It is a reflection of organizational values. When the board prioritizes fiscal responsibility and transparency, it sets the tone for the entire organization. This culture of stewardship strengthens credibility, fosters donor confidence, and supports mission-driven growth. 

Proactive oversight ensures that financial challenges are identified early and addressed strategically, allowing the organization to remain resilient and focused on its goals. 

How DBC Can Help 

At DBC, we understand the vital role boards play in not-for-profit financial stewardship. Our team provides training, consulting, and audit services designed to help board members understand their financial responsibilities and strengthen oversight practices. 

Whether your organization is refining its internal controls, developing governance policies, or reviewing financial reports, we can help your board make informed, confident decisions that safeguard your mission and ensure sustainability by fostering a culture of transparency, accountability, and financial strength. 

Succession Planning for Not-for-Profit Leadership and Financial Roles 

For not-for-profit organizations, leadership transitions are inevitable, but they do not have to be disruptive. Whether it is the retirement of a long-serving executive director, the departure of a finance manager, or the transition of a key board member, effective succession planning ensures that your organization’s mission continues seamlessly. By planning ahead, not-for-profits can preserve institutional …

For not-for-profit organizations, leadership transitions are inevitable, but they do not have to be disruptive. Whether it is the retirement of a long-serving executive director, the departure of a finance manager, or the transition of a key board member, effective succession planning ensures that your organization’s mission continues seamlessly. 

By planning ahead, not-for-profits can preserve institutional knowledge, maintain financial stability, and protect stakeholder confidence during times of change. 

Why Succession Planning Matters 

Leadership and financial roles in not-for-profits carry significant responsibility. These positions are often tied directly to the organization’s mission, relationships, and financial health. Without a plan in place, sudden departures can lead to confusion, gaps in oversight, and even risk to funding or compliance. 

Succession planning helps your organization: 

  • Prepare for both expected and unexpected leadership changes  
  • Maintain continuity in governance and financial management  
  • Strengthen long-term sustainability and resilience  
  • Demonstrate stability to donors, employees, and the community  

When managed proactively, leadership transitions can become opportunities for renewal and growth rather than sources of uncertainty. 

Identifying Key Roles and Responsibilities 

Effective succession planning starts by identifying which roles are critical to your organization’s success. For most not-for-profits, this includes: 

  • Executive leadership: Executive directors or CEOs who oversee mission, strategy, and community relationships  
  • Financial management: CFOs, finance directors, or accountants who ensure compliance, transparency, and fiscal health  
  • Board leadership: Officers who provide oversight, governance, and strategic direction  

Documenting key responsibilities, processes, and decision-making authority for these roles helps ensure continuity when transitions occur. 

Steps to Develop a Strong Succession Plan 
  1. Assess Current and Future Needs
    Evaluate your organization’s strategic goals anddetermine the leadership and financial skills required to achieve them. Consider how your needs might evolve over the next three to five years and identify any gaps in current capabilities. 
  2. Document Essential Knowledge and Procedures
    Capture key processes, contacts, and institutional knowledge before a transition occurs. Maintaining up-to-date job descriptions, financial procedures, and access controls ensures smoother handoffs and minimizes disruption.
  3. Develop Internal Talent
    Encourage professional development for current staff andidentify potential future leaders within your organization. Cross-training team members on financial and administrative tasks not only prepares them for advancement but also enhances organizational resilience. 
  4. Establishan Emergency Transition Plan 
    Unplanned departures can occur without warning. Create an interim leadership strategy that designates who will assume temporary responsibility for key functions until a permanent replacement is found. 
  5. Involve the Board Early
    The board of directors plays a crucial role in leadership continuity. Engage them in planning discussions and ensure they understand their responsibilities in overseeing transitions for both executive and financial roles.
  6. Review and Update Regularly
    Succession plans should be living documents. Revisit them annually to reflect organizational changes, updated job roles, and emerging priorities.
Maintaining Financial Continuity During Transitions 

Leadership changes often impact financial operations, making careful planning essential. To maintain stability: 

  • Ensure dual authorization for financial transactions and system access to prevent gaps in oversight  
  • Review internal controls to confirm that duties are properly segregated, even during temporary transitions  
  • Keep funder relationships informed to maintain trust and transparency throughout leadership changes  
  • Engage external advisors to provide continuity in accounting, audits, and reporting when internal transitions occur  

A proactive approach to financial continuity reinforces confidence among stakeholders and prevents interruptions in day-to-day operations. 

Building a Culture of Preparedness 

Succession planning is not just about filling positions. It is about building a culture of preparedness. When organizations view leadership continuity as part of long-term strategy, they empower employees, reassure donors, and strengthen community trust. 

Investing in leadership development today ensures that tomorrow’s transitions are handled with professionalism and stability, keeping your organization focused on its mission even during a time of change. 

How DBC Can Help 

At DBC, we understand that leadership and financial transitions can be complex. Our team works with not-for-profits to strengthen internal controls, establish clear succession processes, and ensure financial continuity through periods of change. 

Whether you are developing your first succession plan or refining an existing one, we provide the guidance and support to help your organization maintain stability, accountability, and confidence by building systems that sustain your mission over time. 

 

Forecasting Project Profitability: Tips for Contractors 

Profitability is one of the clearest indicators of a project’s success, yet it can be difficult to measure accurately while work is still underway. Material prices shift, labor needs evolve, schedules change, and unexpected conditions can influence costs long before a project is complete. Without a reliable forecasting process, contractors may not recognize developing problems until …

Profitability is one of the clearest indicators of a project’s success, yet it can be difficult to measure accurately while work is still underway. Material prices shift, labor needs evolve, schedules change, and unexpected conditions can influence costs long before a project is complete. Without a reliable forecasting process, contractors may not recognize developing problems until margins are already weakened. 

Strong profitability forecasting helps contractors understand where a project stands today and where it is likely headed. When supported by accurate data and practical financial tools, forecasting becomes an essential resource for guiding decisions throughout the life of the job. 

Start With Accurate Job Costing 

Profitability forecasts are only as strong as the data behind them. Job costing must reflect what is actually happening on site, not just what was planned. This includes labor hours, material usage, subcontractor costs, and equipment time. 

Accurate job costing helps contractors: 

  • Compare real costs to estimates 
  • Identify cost categories that are trending higher than expected 
  • Understand how field decisions affect financial outcomes 

This information provides the foundation for reliable forecasts. 

Use Work-in-Progress Reports to Track Progress 

Work-in-progress reports help contractors understand how costs and revenue align with project completion. WIP reporting highlights overbilling, underbilling, and the percentage of work completed, all of which influence profitability. 

When reviewed regularly, WIP reports help contractors adjust staffing, reschedule activities, or revise budgets before problems grow. 

Evaluate Project Assumptions Throughout the Job 

Forecasting requires revisiting the assumptions that guided the original bid. Market prices, labor availability, and project conditions rarely remain static from start to finish. Contractors should periodically evaluate whether the assumptions behind their estimates still hold true. 

Questions that support this review include: 

  • Has labor been more or less efficient than expected? 
  • Are material prices higher than when the estimate was created? 
  • Have any subcontractors adjusted their pricing or availability? 
  • Are there scheduling delays that could increase costs? 

This type of evaluation helps contractors update forecasts with real-time information. 

Monitor Change Orders and Their Financial Impact 

Change orders often shift a project’s financial outlook. Even small adjustments can affect labor needs, material requirements, and job sequencing. To maintain accurate profitability forecasts, contractors should track the financial impact of change orders as soon as they occur. 

When captured early, these changes can be incorporated into revised budgets and forecasts, helping contractors avoid surprises later in the project. 

Compare Estimated Profit to Earned Profit 

Estimated profit reflects what contractors expect to earn when the project is complete. Earned profit reflects what has been achieved to date based on progress and actual costs. Comparing these two helps contractors determine whether they are on track or drifting from their projections. 

A significant variance between estimated and earned profit may signal the need for schedule adjustments, budget revisions, or resource changes. 

Use Historical Data to Improve Future Forecasts 

Completed projects offer valuable insight. By reviewing past performance, contractors can identify trends such as recurring cost overruns, underestimated labor categories, or consistent delays in certain phases of work. 

Historical data strengthens future forecasting by helping contractors: 

  • Build more accurate estimates 
  • Anticipate common problem areas 
  • Improve staffing and scheduling decisions 
  • Refine procurement strategies 

This continuous improvement strengthens profitability over time. 

Strengthen Communication Between Accounting and the Field 

Forecasting is most accurate when financial information and field activity stay connected. Regular communication between project managers, accounting staff, and field supervisors ensures that both teams work with the same understanding of project status. This helps contractors adjust forecasts quickly and maintain a clear view of the project’s trajectory. 

Building Confidence in Project Performance 

Profitability forecasting gives contractors the visibility they need to manage projects with confidence. When supported by accurate job costing, clear reporting, and open communication, forecasting becomes a powerful tool for guiding decisions and protecting margins. 

At DBC, we work with construction companies to build forecasting processes that support stronger financial outcomes and long-term growth. If you would like to strengthen your approach to project profitability, our team is here to help. 

Managing Cash Flow in Work-In-Progress Construction Projects 

Cash flow is one of the most critical elements of any construction project, and long-term projects place even greater pressure on a contractor’s financial structure. These projects often span multiple seasons, require large upfront investments, and fluctuate in cost as labor and material needs evolve. Even profitable projects can become difficult to manage if cash …

Cash flow is one of the most critical elements of any construction project, and long-term projects place even greater pressure on a contractor’s financial structure. These projects often span multiple seasons, require large upfront investments, and fluctuate in cost as labor and material needs evolve. Even profitable projects can become difficult to manage if cash flow is not monitored closely. 

Strong cash flow management helps contractors maintain steady operations, keep projects moving, and avoid unnecessary financial strain. With the right planning and oversight, long-term work becomes more predictable and far easier to manage. 

Understanding Why Long-Term Projects Strain Cash Flow 

Long-term construction projects introduce unique challenges that shorter jobs rarely experience. Contractors may face: 

  • Extended payment cycles tied to specific milestones 
  • Rising material or equipment costs over time 
  • Delays that affect both scheduling and billing 
  • Changes in scope that alter the financial structure of the job 

Because these projects evolve continuously, cash flow must be monitored just as consistently. 

Build a Cash Flow Forecast That Follows the Project 

A detailed cash flow forecast should mirror the life cycle of the project. Forecasting helps contractors anticipate when expenses will occur, when payments are expected, and where cash shortages may develop. 

A strong forecast typically includes: 

  • Planned labor and subcontractor costs by phase 
  • Expected material purchases 
  • Billing schedules tied to milestones or monthly progress 
  • Contingency amounts for unexpected changes 

Updating the forecast as the project progresses helps contractors make decisions early rather than reacting after a problem appears. 

Strengthen Billing Practices 

Billing practices significantly influence cash flow in long-term projects. Delayed billings, underbillings, or unclear documentation can slow payments and create difficulties in meeting upcoming costs. 

Contractors benefit from reviewing whether their billing practices: 

  • Align with contract terms 
  • Reflect work completed to date 
  • Include change orders promptly 
  • Follow a consistent monthly or milestone schedule 

Accurate and timely billing helps keep cash coming into the business at the pace needed to support the work. 

Monitor Work-in-Progress and Overbilling 

Work-in-progress reporting is an important tool for tracking cash flow. Overbilling and underbilling both influence the financial health of a project. 

  • Overbilling may improve short-term cash flow, but if costs later exceed expectations, it can reduce billing available in later phases. 
  • Underbilling restricts cash flow because work is completed without a corresponding payment. 

Monitoring WIP results helps ensure billing and work progression remain in balance. 

Manage Material Purchases Strategically 

Material pricing can shift significantly over long project cycles. Contractors may need to analyze whether materials should be purchased early, in phases, or through negotiated agreements with suppliers. 

Strategic purchasing decisions help avoid unexpected cost spikes and support better cash flow planning. 

Maintain Strong Communication With Subcontractors 

Subcontractor performance and timing affect both project progress and cash flow. Clear communication about scheduling, payment expectations, and documentation requirements helps prevent delays that can slow down billing. 

When subcontractors submit their paperwork consistently, contractors can bill earlier and more accurately. 

Protect Cash Flow During Change Orders 

Change orders are common in long-term work, but they can strain cash flow when not handled promptly. Costs related to changes should be documented and submitted quickly so that billing reflects the actual work being performed. 

A consistent change order process helps contractors: 

  • Maintain accurate budgets 
  • Prevent unapproved work from accumulating 
  • Ensure payment keeps pace with job progression 
Review Contract Terms Before the Project Begins 

Contract terms shape how cash flows throughout the project. Reviewing key components before work starts helps contractors avoid issues later. Important elements include billing frequency, retainage, milestone definitions, and payment turnaround times. 

Understanding these terms allows contractors to plan ahead and build a realistic cash strategy. 

Bringing Stability to Long-Term Projects 

Managing cash flow in long-term construction projects requires a combination of careful planning, consistent oversight, and clear communication. When contractors maintain strong forecasting, monitor job progress closely, and follow disciplined billing practices, they create a financial structure that supports long-term success. 

At DBC, we help construction companies strengthen their cash flow strategies, build reliable forecasting models, and create financial processes that support confident decision making. If you would like guidance on improving cash flow management for your long-term projects, our team is ready to help. 

About us

De Boer, Baumann & Company provides professional accounting, tax, and business advisory services to individuals and businesses in West Michigan and the surrounding areas. With expertise in a variety of industries, DBC specializes in comprehensive and innovative solutions to help clients achieve their financial goals.