MARGIN LEAKS

Six places contract value quietly disappears.

None of these leaks show up as a single line item on a cost report. Each one shaves a percentage point or two off margin, and together they're the gap between what a job was priced to earn and what it actually pays out.

01

Billing errors

Wrong takeoff units, misapplied rates and inconsistent BOQ structure turn into invoices that undercharge for work already done.

  • Invoiced quantities are copy-pasted from the estimate, not from the measured book.
  • The same BOQ item shows different units on the estimate and on the client invoice.
  • Rate revisions get applied to new bids but not to the current invoice cycle.
02

Unbilled variations

Extra work gets carried out on site and never makes it back into the BOQ or the next invoice, so it is delivered for free.

  • Site instructions get actioned verbally and logged nowhere until a dispute forces the question.
  • The variation register, if one exists, is weeks behind what's actually happened on site.
  • Contingency is treated as a buffer to absorb unbilled work rather than a priced risk.
03

Equipment under-utilisation

Owned or hired plant sits idle between sites while the depreciation and hire clock keeps running.

  • Hire invoices keep arriving after equipment has been released back or stands unused.
  • There's no single record of which machine is on which site, this week, doing what.
  • Utilisation is reviewed at project close, not while the project can still be corrected.
04

Procurement leakage

Materials get bought against the wrong quantities or the wrong rate card, disconnected from the estimate that priced the job.

  • Purchase orders are raised against site requests, not against the BOQ that priced the job.
  • The same material gets bought at different rates across sites in the same month.
  • Over-ordering shows up as leftover stock nobody is tracking back to a project.
05

Payroll inefficiency

Attendance, overtime and site allocation are tracked on paper, so labour cost per project is a guess until month-end.

  • Attendance is a paper register reconciled once a month, if at all.
  • Overtime gets approved after it's already been paid, not before.
  • Labour cost per project is a month-end estimate, not a running number.
06

Retention & cash-flow drag

Retention money and slow client payment cycles starve the next project of working capital, even when the contract itself was profitable.

  • Retention release dates are tracked informally, if they're tracked at all.
  • A profitable job on paper still needs financing because payment lags the work by months.
  • Cash-flow forecasts assume on-time client payment even when the pattern says otherwise.
NEXT STEP

Find your leaks with JobNext.

JobNext ties estimation, procurement, attendance-to-payroll and billing into one ledger, so a leak shows up as a number, not a guess at month-end.