Job burnoff schedule

Matching Revenues, Costs and Cash Flow

8/2/2012 1All Rights Reserved

Breakdown of total revenues and costs over the life of the

contract


Job Number

Job Name

1st app date

Expected start

date

Billings Costs Shop MD Site MD OH MD

Total estimated From contract and detailed budget

Jan

Split billings

across contract

period. Should

reflect any

expected

over/underbilling

s .

Split costs

across the

contract period.

Should be

consistent with

the manday

breakout to the

right.

Break out manday budget across contract period.

Should be consistent with the budget. Also should

be consistent with project work schedule

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total - - - - -

Check


Job Number 6666

Job Name Sample

1st app date 08/25/12

Expected start

date 08/15/12

Billings Costs Shop MD Site MD OH MD

Total estimated $50,000.00 $30,000.00 10.00 50.00 4.00

Aug 5,000.00 2,500.00 5.00 1.00

Sep 10,000.00 6,000.00 2.00 10.00 1.00

Oct 15,000.00 10,000.00 1.00 15.00 1.00

Nov 15,000.00 10,000.00 1.00 15.00

Dec 5,000.00 1,500.00 1.00 10.00 1.00

Jan

Feb

Mar

Apr

May

Jun

Jul

Total 50,000.00 30,000.00 10.00 50.00 4.00

Check - - - - -


Scheduling

Evaluating hiring needs

Another cut at identifying milestones

Cash flow projections


So if you think that the payment terms don’t matter, you’re wrong…

Take the Random House. Small job, quickly completed. Why bother the client with a deposit? Why not just wait until the job is complete?


A Simple Example:What you need

Contract Value $ 4,475.00

Costs Mandays

Budget

Site $ 1,900.00 4.50

Shop $ 1,100.00 2.75

Overhead $ 525.00 1.50

Total $ 3,525.00 8.75

Terms:

Deposit on receipt $1,118.75

Balance n30 $3,356.25

$4,475.00

Budgeted gross profit % 21.23%

Budgeted cash flow (profit) $950

9011-Random House

From budget

From Contract


Job BurnoffSchedule

Job Number 9011 Job Name Random House

1st app date 05/15/12

Expected start date 05/25/12

Billings CostsShop

MD

Site

MD OH MD

Total estimated $4,475.00 $3,525.00 2.75 4.50 1.50

May $1,118.75 $1,362.50 2.75 0.75

Jun $3,356.25 $2,162.50 4.50 0.75

Total $4,475.00 $3,525.00 2.75 4.50 1.50

9011-Random House

Enter totals from budget

Break out by month—general,

big picture


Cash In Cash OutNet cash in

(out)

Total estimated $4,475.00 $ 3,525.00 $ 950.00

May $1,118.75 $ 1,090.00 $ 28.75

Jun $0.00 $ 2,002.50 $ (1,973.75)

Jul $3,356.25 $ 432.50 $ 950.00

Total $4,475.00 $3,525.00

Assumptions:

Deposit received before work begins

Final payment received net 30

80% of costs paid in same month; balance paid following month



(out)

Total estimated $4,475.00 $ 3,525.00 $ 950.00

May $0.00 $ 1,090.00 $ (1,090.00)

Jun $1,118.75 $2,002.50 $ (1,973.75)

Jul $3,356.25 $ 432.50 $ 950.00

Total $4,475.00 $3,525.00

Assumptions:

Deposit received after work begins





(out)

Total estimated $4,475.00 $ 3,525.00 $ 950.00

May $0.00 $ 1,090.00 $ (1,090.00)

Jun $1,118.75 $2,002.50 $ (1,973.75)

Jul $0.00 $ 432.50 $ (2406.25)

Aug $3,356.25 $0.00 $950

Total $4,475.00 $3,525.00

Assumptions:

Deposit received after work begins





(out)

Total estimated $4,475.00 $ 3,525.00 $ 950.00

May $0.00 $ 1,090.00 $ (1,090.00)

Jun $0.00 $2,002.50 $ (3,092.50)

Jul $0.00 $ 432.50 $ (3,525.00)

Aug $4,475.00 $0.00 $950

Total $4,475.00 $3,525.00

Assumptions:

Deposit request ignored




Cumulative Cash in (out)

Month Case 1 Case 2 Case 3 Case 4

May 29 (1,090) (1,090) (1,090)

Jun (1,974) (1,974) (1,974) (3,093)

Jul 950 950 (2,406) (3,525)

Aug 950 950


Bottom line:

1. Even small jobs can drain cash

2. Small cash drains mean cash not available for startups

3. Effect of small jobs cash drains only multiplied on larger jobs

4. Banks/sureties understand this effect and want to see us managing cash rather than being managed by cash


Job burnoff schedule

Business

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