Respect in Your Construction Company

Showing respect and dignity in your construction business is worth the effort


While researching the topic of respect and dignity at work, I came across many statements like this, “A Dignity and Respect at Work Policy encourages a working environment that is free from Bullying and Harassment.” And, this exact wording of that idea was the very first sentence in one (rather boring) article I read.

Other articles harp on how much a company loses when there is a large turnover of workers. Their premise that people will hang around longer when treated well makes sense.

But it seems the need to respond with dignity and respect in dealing with your employees loses its power when shrouded in the negativity of losing money “if you ain’t nice.”

Respectful for the right reasons

So, I’ll state (for the record) I know there is a huge financial drag on businesses which can’t retain their employees. Further, I’ll note that when others are treated with dignity and respect across the board, lawsuits (and their costs) derived from bullying and harassment don’t see the light of day.

So, if you “don’t harass” someone, does that mean you respect them and allow their dignity to show through? Not at all!

I’ll give you an example. You can force kids to “play together.” But you can’t force kids to “have fun together.”

Being respectful must come from the heart. And in your construction business, showing respect starts with your attitude. From there, it seeps into the culture you build within your construction company.

The real value of showing respect

I dug further. One article I read on the topic makes a great deal of sense. Glenn Llopis, writing for Forbes says, “Employees want leaders that are likable, understand their needs, can authentically motivate people and know how to energize a workplace culture to generate the best results for the organization.”

Seeking employee input, hearing their concerns, giving recognition when an employee does a good job, are all good ways to show respect for them. And it allows them to see you respect them as individuals.

It’s no mystery; the value of your team increases when they know you respect and value them.

The lowest common denominator is – be nice.

Respect isn’t always easy

With that being said, I must note, being nice isn’t always easy. Bad hair days and grumpy spouses aside, sometimes it takes extra effort to show respect to the noodle-head who has made sixteen mistakes already, and it isn’t even noon.

Keep in mind, showing respect doesn’t mean you don’t call it like it is. It means (when called for) you respect said noodle-head by giving a heads up or a word of caution. You’re not in the land of an elementary school where everyone is recognized as a contributor when the only contribution some kids make is trouble.

Finally, showing respect to others (the rest of your employees) may come in the form of firing the one guy who doesn’t pull his weight – respectfully, of course. 

Avoid screaming hissy fits

It is imperative to avoid screaming hissy fits or tawdry put-downs. And, more important than what you leave out of the day is what you put into it. Here are some thoughts and ideas concerning how to develop a company-wide culture of respect and dignity.

  • Tell someone what a great job he or she is doing
  • Show appreciation publicly
  • (Just as importantly) Show appreciation when no one else is around
  • Compliment an employee to their supervisor, not just to them personally
  • Be sure your employees know they can respectfully disagree (and they will be heard)
  • Offer them opportunities for career growth
  • Let an employee know you used his or her idea
  • (Or) Encourage the employee to implement his or her idea
  • Support employees during times of stress
  • Treat employees fairly and equally

And remember – smiles can set the tone for the day. Plus, they are quite contagious.

A few other things to consider

  • Focus on what went well on the project at a closeout meeting. Be sure to point out individuals as well as teams who “brought it” to the project.
  • Provide lunch and updates of progress (no down talk) at last-Friday monthly meetings.
  • Make a big deal of the annual company-wide family get-together events.


In conclusion

Show your dignity through being respectful of your staff. And teach them to do the same.


We desire to familiarize you with business concepts which will make it easier for you to be a better commercial construction business owner through our blog posts. Some will be new ways of looking at things, and others will be refreshers.


Schulte and Schulte Provides Accounting, Contract Document Management, and Advisory Board Level counsel for small to medium commercial construction subcontractors.

So you can Run With the Big Dogs! Call us 866-629-7735

Construction Accounting – Zooming In

Construction Accounting takes zooming in on the important areas.

One of the questions we’re often asked by commercial subcontractors is, “How do you do it?” The following is a dive into what it looks like working with an outsourced accounting and advisory firm. (Well, we don’t know if it is true for other firms – but this is what it looks like working with us. 😎)

Construction Accounting zoom in on understanding

While it is always our goal to provide each of our clients with a clear and up to date financial picture of his or her business, we remember to do so in English not Accountanteeze.

Some have shared there was a time, before they came to us, when they looked at all those reports and thought of them as a foreign language. We’ve become their “complexity filter.”

A few other things we implement in understandable language are:

  • Guidance for meeting long and short-term goals
  • Information concerning strategic thought and vision
  • Processes which make profit a verifiable reality

At its core, our services provide clients with confident, well-informed, professional advice.

Construction Accounting zoom in on client needs

Each client comes with his or her own set of needs. Things like:

  • Please clean up our old issues.
  • Can you just get us back on track?
  • We need help achieving high levels of profitability.
  • I need to know my books are taken care of and I can rest easy at the end of the year.
  • We’re trying to get bonded and we need to get this mess straightened out.
  • I hate dealing with contract management, can you take care of it?
  • My business coach said I need to build systems; can you help with that?
  • We took in a lot of money last year but can’t see where it went. Can you help?

Regardless of the complication, our goal is to meet individual needs, always striving to make it easier for each client to run with the big dogs.

Construction Accounting zoom in on systems

One of the things we strive to make clear is we are NOT simply financial historians.  While it is necessary that we give timely and accurate financial information, we also aid our clients in other areas. One of those areas is help in building systems.

We help clients:

  • Improve processes and procedures
  • Increase organizational structure
  • Better understand next steps

We help commercial subcontractors figure out which systems are working, and which are not. More importantly, we don’t try to “fix” their unbroken systems.

Zooming in through Zoom

Part of our job is helping our clients devise a tech-stack which helps them have better systems for dealing with their business and financial needs. So yeah, we do spend time with our heads in the cloud. Yet, we’re also down-to-earth when it comes to dealing with our clients.

And the corner where cloud and earth meets is when we have regular Zoom meetings with individual clients. It is during those times we meet with them “face-to-face” whether they’re in New Jersey or New Mexico, North Dakota or South Carolina, in a Phoenix suburb or Phoenix proper.

The types of things we discuss with them are:

  • Month end reports and what they mean
  • Unusual items we noticed in their reports
  • Our questions concerning their data
  • Their questions
  • Ways to improve (both from their end and ours)

While we believe our experience and well-thought-out tech solutions are important to how we help our clients, we believe nothing would be possible if we didn’t have good systems for communication in place. And one of those systems is a video conferencing SaaS called Zoom.

There you have it. We’ve zoomed in on a few things you can count on us to do to help you grow your commercial subcontracting business. And, we’ve told you how it is possible to meet with our clients no matter where they are located. Now you have a better idea of “how we do it.”


Want to learn more? Our office hours are 9 to 5 Arizona time where our main office is located. And our Toll-Free number is 866-629-7735. Give us a call!

Grow an Established Construction Business – Part 3

Business growth through managing cash flow and developing processes

Business is great

Business is great – until it isn’t. The construction contracting business is well known for its boom or bust nature. Using the boom to prepare for the bust is simply a matter of having good business sense. And, two ways you make the preparation are considering future financial needs and creating documented, sustaining processes.

This is the third in a three-part series dealing with growing an established construction business. Taking it up a level. Getting better at running with the big dogs. If you missed the first two parts, they can be found here and here.

Business is all about business

Getting better at doing business is how you position yourself as the owner of a growth-oriented business – a construction business that is in it for the long-haul. Now, we’ll take a look at the last two areas of importance in growing an established construction business.

Prepare for financial needs in advance


Access to capital is what makes the difference between owning a winning business and owning a business that limps along, never quite making it. One of the easiest ways to make sure you have cash to see you through the famine is to save it during the feast. Oh yeah, it is also one of the hardest ways. Like my dad used to say, if it was really easy, everyone would do it.

You can scour the internet and find a multitude of tips and tricks concerning how to save money. I even wrote one post about it here.  Yet, reading about ways to save money without taking action will not get you to the end of the block, much less all the way to the other side of town.

Time to take action

Now it is time to buck-up. This is when, if you’re not a natural saver (and few are) you need to find someone to aid you in making the right decisions concerning spend or save.

So, I’ll go ahead and throw this out there. The folks here at Schulte and Schulte are good at providing financial reports and teaching you how to interpret them. Yet, we have even more than that to offer. We, ever so gently, guide our clients into the act of saving. OK, some would say we hold their feet to the fire. Whichever way you interpret what we do, we help our clients get into position to save for a raining day.

Saving is a strategic maneuver which takes guts, determination, and (sometimes) help from an outside source.


There is another way to have cash when you need it and that is to borrow it. I know, I know. There are those who say the only way a lending agency will hand over the funds is if you can prove you don’t really need it.

Truth is, there are a number of things you need to prove, but lack of need isn’t one of them – usually. 🤔

Your financial records and reports are key to being able to borrow the cash you need at any given time.

What lenders want

Here is a sampling of the things a construction-wise lender is likely to want to know about you and your business:

  • How long have you been around?
  • Have you run your business well so far?
  • How much outstanding debt do you have?
  • How safe are your jobsites?
  • What is your credit score?
  • What is the credit score of each of your clients?
  • Is there collateral you can offer?
  • What is the dollar amount of your annual sales?
  • Have you experienced a bankruptcy or tax lien?
  • How much do you need?
  • What do you need it for?

Once again, having your financial reports at hand and knowing what they’re saying about how good you are at running a construction contracting business is essential.

Knowing where to go for the loan is also important. Check around with your fellow contractors for suggestions. Contact your mentor or other trusted advisor for his or her input. Look for a loan provider who is a member of your trade association – they often have insight into your trade’s specific needs.

If you’re interested in working with someone who provides Accounts Receivable Financing, we suggest Contractors Capital Solutions

Create documented, sustaining processes

There may be a number of factors concerning how the “big dogs” in your sector of the construction industry made it to their status, but you can be assured that one of the things they did is create documented processes. They use documented processes in both the field and the office to maintain consistency throughout their organization.

Yet, most small to medium construction subcontractors overlook or avoid this step in building their businesses. Here at Schulte and Schulte, we think this point is so important we go so far as to say put process improvement before technology adoption.

The GPS of processes

Think of it this way; when you begin documenting your processes you’re creating what equates to an internal GPS. Rather than Global Positioning System, you can see it as your Great Processes System. While regular GPS gives information that helps people determine their location on a global scope, internal GPS gives information that allows you and your people to determine their duties (and actions) on a companywide scope.

Beyond consistency, creating and documenting processes gives you:

  • Ability to analyze your processes
  • Knowledge to make improvements in the processes
  • Understanding for better managing your business
  • Capability to monitor service levels
  • Competence spread throughout your organization

Create a library of standardized processes

Creating internal processes (then implementing them) brings a real challenge. It is especially difficult for small companies with mostly operational staff who are very busy “doing what they do” to get this additional task done. That doesn’t even take into consideration that most people are unsure of what all should, could, or must go into the step by step writing of the processes.

That’s why we’re quite excited to let you know we’re working on building a system in which our clients will have access to the tools they need to build their own library of standardized processes unique to their subcontracting business. We hope to have the roll-out by January of 2019. How’s that for a cliff-hanger?

Want to know more? Get in touch with us here.

Grow an Established Construction Business – Part 1

Grow a construction business

You’ve gone beyond finding your first client. You’ve gotten past all the start-up issues. You are ready to take the next steps to grow and prosper your construction business. Grow and prosper in ways which are likely to surpass your original dream.

It is fun to look back on and remember those heady days when you first became a business owner. It is even more fun to look ahead at what you’ll accomplish next.

Now it is time to roll up your sleeves and get to work – on the next steps.

Grow – it isn’t an easy task, yet it is enjoyable

There is so much involved; from mindset to cold sweat, from legislation to duration, from tool advance to tech enhance – there’s just a lot going on.

Think about it. Consumer behaviors are changing, the culture is shifting, and it is happening rapidly. It’s rather exciting!

You’ve brought your business this far. And now, the real work fun begins.

Grow – the next steps

The first thing to consider is your own attitude and a willingness to position yourself as the owner of a growth-oriented company. From there you can look at specific areas which need your attention to facilitate growth.

The areas we’ll be discussing in this three-part series are:

  1. Dealing with changing regulations
  2. Managing project risk
  3. Planning for new technology
  4. Preparing for financial needs
  5. Creating documented, sustaining processes

Deal with changing regulations

Staying on top of all the changing regulations isn’t a job for the faint-of-heart. It takes time as well as a team of trusted advisors. Following are five suggestions which will help you in your efforts.

Join a trade association. For big picture insights into which regulations to be aware of in your segment of the construction industry, joining a trade specific association is a no-brainer. A good association will keep you informed of upcoming changes.

Subscribe to magazines and online industry related blogs or websites. One type of website that is helpful concerning construction regulations is that of attorneys who specialize in construction law. Put your search engine to use. The search can be as simple as “construction attorney [your state] dot com” Search through and find the ones which keep up-to-date relevant posts then subscribe or bookmark.

Track down a tax advisor. Because you’re not only dealing with federal taxes you will do well to locate an advisor who is abreast of the regulations in your state. One recommendation we make for our Arizona clients is Conover Asay. If you’re unsure who to contact in your state, you may wish to ask your fellow contractors who they use and why they recommend them.

Find a human resource expert. Freelance human resource firms are an excellent way to stay on top of regulations concerning employee and subcontractor issues. We recommend Lynda McKay of HRextension to our clients.

Locate an accounting advisory firm. (And yes, that’s us. 😉) Beside the fact we know how to deal with your sales tax issues, we’re excellent at helping you use the information obtained from your tax and human resource advisors. They can tell you what the rules are, we can help you make sure your firm remains compliant.

Grow through the use of proper resources

Finding the right resources as well as discovering ways to stay on track will be your biggest challenges through the process of growing your construction contracting business. Our clients tell us we’re good at assisting in both areas. In next week’s post, we’ll tackle “managing project risk” and “planning for new technology.”

We’ve created a waiting list for those who are prepared to work with us in growing their construction contracting business. To get in on “the good stuff” call 480-442-4032 or get in touch here.

Our Clients Are Savvy Contractors – Take a Peek

Our clients are construction subcontractors.

Who our clients are

Our clients are construction subcontractors. Yet there is more to the picture. They’re ambitious, smart, determined, enthusiastic, resourceful, industrious go-getters.

We understand the position many of our clients are in when they come to us. They’re splitting their time between:

  • returning phone calls
  • developing new products or services
  • going on sales calls
  • hiring or firing employees
  • managing social media
  • doing the bookkeeping
  • answering email
  • checking the jobsites
  • invoicing
  • dealing with payroll
  • marketing
  • keeping employees motivated and happy
  • networking
  • and . . . well, simply putting out fires which are often left still smoldering.

This list from OSHA describes Construction Special Trade Contractors. And, it does a fair job of identifying the types of businesses our clients own.

How our clients are served

At Schulte and Schulte, we are advisers and consultants, not just bookkeepers or accounting specialists.

Why do we consider the difference important?

Bookkeeping is a component of a construction company’s financial health. Yet that is not the only component. We provide counsel and advice on financial and business issues. Advice that goes beyond the scope of entering the right numbers in the right place. It is our intention that this approach provides value to our clients in both visionary and in-the-moment ways.

It is important to us to help our clients get meaningful metrics and systems in place so they’re no longer flying blind.

We work with established construction subcontractors who have invested time and money into finding ways to grow their businesses. Subcontractors who are ready to take the next step. Subcontractors who must get familiar with and in charge of their numbers in order to grow their business and be profitable.

We partner with our clients on a long-term basis to ensure they get results from the work we do together.

Peek at our ideal client

Our ideal client is a construction subcontractor – but not “any old” subcontractor.

Here are the other things our ideal client is:

  1. Accountable and responsive
  2. Willing to listen to and act upon our advice
  3. Tech savvy or willing to learn
  4. Determined to scale their business
  5. Inclined to offer referrals

Peek at us

We provide accountability (beyond simple accounting) and hold our clients’ feet to the fire. The fire of staying on task, putting the right systems in place, and of understanding the metrics.

Are you ready to take the next step in growing your construction business? You can take your place on our waiting list by calling 866-629-7735 or get in touch here.

Part 1 – Let Middle Managers Manage

This is part 1 of a 2-part discussion concerning growing your construction contracting or service business through growing your middle managers. In this section the discussion will center on what you as an owner should be doing in your business while allowing your middle managers to manage other aspects.  

You’re the boss – own it

You have better things to do than being on job sites all day long. Put your time and effort towards critical, big-picture decisions concerning your construction contracting business. The areas you should consider are:


reducing cycle times

eliminating waste

increasing on-time delivery


preparing budgets

reducing outstanding debt

growing profit techniques


improving customer satisfaction

discerning inventory turns

identifying repeated bottle necks


communicating the vision

holding others accountable

gaining new industry insights

instructing or providing instruction for employees

It is your job to clearly visualize the end result of each job and how that job affects your overall goal of company growth and profit building. Therefore, you do well to assign responsibilities and accountabilities to the correct people — the middle managers, thus assuring you get there.

In part 2 we’ll look at what it takes to have an excellent team of middle managers doing their jobs well, making it possible for you to do your job well. You can see part 2 by going here

Do You Really Understand the Financial Position of Your Construction Contracting Business?



If you’re like many people who own construction contracting and service businesses, you likely have little to no financial training. That’s OK, you probably have a slew of other skills which allowed you to move into the realm of business owner.

It is also likely that you put a lot of time and thought into knowing where your crews are, what they’re doing, and which tools and supplies they’ll need for the day. Yet, you may be less likely to know where your dollars are, what job each dollar has, and how well they’re pulling for the team.

Run a better construction contracting business

While business management is a multi-faceted matter, one of the best ways you gain acumen in the business world is to know and understand how to make best use of the money you control. You know you’re “getting it” when you can:

  • Grasp the benefits of Job Costing


  • Discern the difference between Revenue and Gross Profit


  • Recognize the importance of Document Management


  • Increase your savvy in the Budgeting department


  • Focus on the Important Data


Getting to the money matters part of accounting means you can know (not just guess) when to put your marketing dollars to use or which types of jobs will never be your friend. It means you can make sense of what was once a whirlwind of numbers and terminology.

Why build your money management skills?

Develop your money management expertise so you can help your construction contracting or service business prosper. When you see where your company’s money is actually going, you’re better able to build a path toward success.

How Schulte and Schulte fits in

Our goal is to assist you in creating an easy to follow and understand bookkeeping process. Further, we explain what is happening along the way, giving you the benefit of discerning your financial standing and taking advantage of that knowledge.

Let’s build this together. Call 480-442-4032 or get in touch here.

Financials: Cash Basis versus Accrual Basis for QuickBooks Online

If you want to get a handle on the numbers in your Construction Contracting business then it is imperative you understand your financial statements.

Understanding the difference between a cash basis financial statement and an accrual basis financial statement is a good start. Then, understanding what makes them different in QuickBooks online and how they’re deciphered there aids you in getting a firm grip on those numbers.

Cash Basis Perspective Gained – The Cash Flow within Your Construction Contracting Business

In its most simple format, Cash Basis is achieved by recording your income and expenses when payments are received and when expenses are paid. If money moves one way or the other it is recorded then and there. Your customer pays his invoice and the amount is entered as received. You buy some new tools and the cost is entered as paid out.

Example: Customer ABC agrees to a job which will cost him $1,000. He pays you when the job is complete. This is a cash basis transaction.  (Even if he pays you with a credit card, it is a cash basis transaction because the credit card company will place the fund in your account within a couple of days.) Therefore, payment was made. Yet, if the customer pays you the next month, you won’t recognize the sale until next month.

Accrual Basis Perspective Gained – The Financial Health of Your Construction Contracting Business

Now, on to Accrual Basis. In this format, you record your income and expenses as payments are earned and expenses are incurred. Put simply, you record the transactions whether the money moved or not. What you’re doing is recording when the promise of payment is made, whether by you or by your customer. What you will see is either an Accounts Receivable or Accounts Payable in your books.

Example: You perform a job for customer XYZ. Once you’re done, you leave the job site. When you return to your office you generate an invoice and send it to her for $1,000. This is an accrual basis transaction. The customer now owes you money for your services and you now have an accounts receivable balance on your books.

Now if your construction business delivers long-term contracts, transactions that will take longer than 12 months or cross fiscal years, then these rules get a little more sticky. I won’t try to get into the ramifications of those circumstances in this post.

What all this means for your transactions through QuickBooks Online

In QuickBooks online, it is very easy to switch between cash and accrual systems in the reports. At the top of the report, where the options are listed, you will see Accounting Method. When you switch from accrual to cash, QuickBooks reverses out receivable and payable transactions because cash did not change hands, no cash moved.

Once you make the switch the financial statements will look different. And, as you can see, this is because some transactions are handled differently under each accounting system.

Not all transactions are converted equally under each system. Understanding these differences and how they affect your financials will help you understand which financial picture you are looking at.

One step further

Let’s go back to our previous example under the accrual method above, where you created the invoice for $1,000. This invoice will appear on your accrual basis Profit and Loss under sales but it will not appear on your cash basis Profit and Loss. Because of this difference, when you look at the cash basis Profit and Loss, it will not show you how many sales you really transacted during that period and your statement will be understated. Only the accrual Profit and Loss will show you the true sales number.

If customer XYZ pays you $500 of the balance, when you look at your accrual basis Profit and Loss under sales you will still see the $1,000 sale, but now when you look at your cash basis Profit and Loss you will see the $500 under sales. You only see the $500 because you actually received the cash.

Yet, when you look at this financial statement, your sales are again understated. This time by the $500 balance that remains. This is an important distinction to understand when looking at how much sales your business generated for the period.

The effect of these two examples can also occur in your expenses or accounts payable transactions. If you record a bill for $100 in supplies, that bill will appear in your accrual system profit and loss but not your cash system profit and loss. This will result in understated cash basis financials. Once you make a $50 payment on that bill, the $50 payment will appear on your cash basis Profit and Loss but that statement will still be understated by the $50 balance still due.

Know what you’re looking at

When looking through your financial reports, be certain you understand the type of data each report provides based on the accounting method being used.

We, at Schulte and Schulte, LLC believe the accrual method is best because it tells you the financial health of your business. Yet, if you are inclined to run a cash basis statement, be certain you understand what you are looking at and the story that it tells.

Have questions? Give us a call, we can even help you make sense of those long-term contracts and accounting that occurs cross fiscal years. 480-442-4032 or Toll Free: 866-629-7735