Why Your Job Margins Look Fine and Your Bank Account Does Not

A contractor recently showed us a job schedule with consistent twenty-eight percent gross margins and a checking account that had not grown in two years. Both facts were true, and neither was a mystery once the costs were traced.

Small tools, unbilled change orders, rework absorbed as goodwill, and supervisory time coded to overhead never touched a job. Every one of them was real cash leaving the business, and none of them appeared where decisions were being made.

The fix is not more precision for its own sake. It is a deliberate decision about which costs belong to work and which belong to the enterprise — applied consistently, so the margin you see is the margin you earn.

Once the allocation is honest, pricing conversations change. So does the answer to which work you should stop taking.