[Rick Carver]

I'm wondering here,,,,, If anyone out there new what their Net was before using a new software program and what it was after using the program?

In other words what was the percentage difference? before and after?

Another question to ponder,,,,,,,,,
Can software really change any FIELD inefficiency into anything better then what it is?

It's a deep question when ya think about it,,,,,,

If software takes our numbers from completed operations and basically compares to numbers that we already fed the program from the estimate etc etc,,, how can the program actually ever report any inefficiency at all?????????????????????????
After all,,,,, doesn't all our numbers come from an original source to begin with,,,,, in operations our number that is our actuall
" benchmark" would be the estimate right?
OK,,,,, so the numbers that created the estimate (except material) had to have come from our P&L,,,,,,,,

OK,,,, so what kind of software can ever change my P&L to allow me to increase my NET???

I have been amazed that a certain software program on the market hasn't been challenged yet on their advertising that if you want a 30% net buy XXX software,,,,,, DAH!!!!!!!!!!!

Thoughts???
Rick

[agla]

People who I worked for in the past used to add up all of the cost of employees at the end of the year. That meant office help, laborers, designers, foreman, management, .... all of it. That meant all of the money associated with having them work - ss, medicare, workman's comp, IRA's, ....

They then divided that total number by all of the billable hours from that year. That meant hours worked on contract jobs or those being billed hourly. In other words, hours directly producing. That gave them the average hourly break even rate it cost them to have the employees working on the job. They added a percentage of profit to that number (they used 10%) to determine the target hourly billing rate for labor the next year.

When they analyzed a job using their software, they would judge how well they did by multiplying the hours spent on that job by that billing rate. If they came up short, they'd try to correct it either by managing the job tighter, or by adjusting the estimation formulas for the next similar job. Of course, they also compared actual material costs vs. the estimate as well.

It all hinges on collecting enough data on the actual production on the job. They did that by having some redundancy to check for mistakes. Each employee punched a time clock. Each employee was also required to fill out a detailed time sheet at the end of the day. They had to acount for all of their time, not only what job they were on, but what part of the job (ie, 7-7:30 load truck get to job, 7:30-9:00 prepped for walk,..). Then the job supervisor would have daily job cards. He'd make one for the walkway, the lawn, planting,... That card would list the names of the laborers and the time each spent on that particular job. On the back of the card, all materials that came to the site for that job are listed (ie, 8 tons stonedust, 563 bricks, 80 of edge restraint,...). Of course, all materials purchased would have their destination written on the receipt.

This allowed us to keep track of where everyone was, where the materials went which is good for loss prevention. It gave us a chance to find when someone made an error by forgetting a laborer or that they got that fourth load of loam. But most of all, it gave us the data to figure exactly what it cost us to do the job without much effort.

Another side benefit is that the employees know that you are tracking the hours to each job and it makes them wonder if you bill the client by the hour. That makes those with a conscience not want to be seen slacking by the client.

At the end of a job, you add up all of the job cards - labor and materials (also equipment used). You multiply that calculated hourly rate by the man hours worked. Did you come out ahead or behind of the estimate?

Obviously this can be done on paper without software, but tables with formulas in a software program speeds it up and saves on mistakes.

[Rick Carver]

Agla

Seems like a great way of managing,,,,, it is very close to how we ran our operation as well. The most different thing I see is that we had a purchase manager that tracked all material per job and managed yard inventory etc.

I agree that software trully wasn't a do or die tool for us,,,,, it did make tracking easier. BUT,,,,, our software COULD NOT and WOULD NOT add anything to the net in any stretch of ones imagination.

At the begining of any program, info has to be entered. Normally this info is directly tied from our P&L reports,,,,,, BUT what if the P&L is not correctly reporting our loss from operational labor cost?

Now,,,, syaing this, I still question how any software vendor can advertise that by purchasing their product you can realize 30% net?

No flame on here folks,,,,,, just asking if anyone believes the inference that this product is able to do that.

Also,,,,, just to note,,,,, that the old saying goes is true,,, garbage in garbage out,,,,,,, In other words if the software vendor allows it's product to carry inefficiencies IN THE FIELD to be tracked as part of ACCURATE REPORTING on our daily field P&L reporting we are screwed at the NET.... yes?

Why can't a software vendor add a program that would CORRECT our P&L as far as our chart of accounts are concerned, so NO inefficiency will ever be allowed to flow into our reporting hidden as a cost instead of a LOSS!!!!!!!!!!!!!!!!!!!!

I am getting very angry that folks are getting hurt and wasting years losing tons of money because of this PHENOMENON!!!!!

Sorry,,,, but I see this happening all over this industry. I have even attempted to provide this solution to the self proclaimed, biggest green industry software provider, to no avail.

So again,,,,, garbage in garbage out!!!!!!!!

Consumer BEWARE,,,,,,,,,

[AZTLANLC]

I think software can only do is help you to track information and the more you can track the more business decisions you can make.

I don't belive buying clip or any other software can make you net 30%.

I know the software that I have used last couple of years (Gopher) it only added an expense to my net that program had so much potential but it lacks many things specially in the tracking department you can create estimates, enter workers time, schedule work and all but they don't know how to link all the information so you can actually see if the job you just did was profitable.

[Bill Schwab]

Unless you recover for all the time software takes to run your operation, and unless you charge more for all thr mon ey software is supposed to save you, software actually will REDUCE your net, take focus off things that matter more, and cause you to be very frustrated. I've said this before and I know many would disagree because they don't know any better, but here goes. There comes a point in a business, size, shape, structure, when software actually breaks even and then eventually becomes more efficient than running your business the old school way. I have the numbers to prove that because I have done it both ways.

I feel very strongly that we are in a more is better phase of the technology field, and I cringe when I see these fairly new to the business people comming in thinking that any software is that silver bullet that will give them rags to riches wealth and prosperity. At the early stages of business, you can actually run things better with a paper spreadsheet and a .05 pencil. If someone wants to technify, at that point, everything they could ever want and need can be done through Quick Books, and you don't even need the version with all the bells and whistles.

Only at the points that you intend to grow, and actually use a particular program do I feel a person should ever for a second think about adding techno junk. They change it with the weather, and by the time you begin really using it as you intend, it's outdated and unsupported. Even QB refuses support on programs after a few years.

[GLAN]

Interesting

I think I know what program we are talking about......

However....as I read through the posts I couldn't help but associate the content to that of not programs but rather tools and equipment.

I have no need for a skid steer.....a mini like a Dingo, maybe. But a full size skid steer? no.........a few years back a salesman for Bobcat called and told me that buying a skid would increase my profit.......He went on to explain that most guys feel that a skid steer replaces 2 men.........True, yes, I can see that. But 1 has to opperate it.......but at the end of the conversation I mentioned that the skid would not make me significantly more profitable has he was making it sound...........because the simple fact that the machine needs to be paid for and maintained. I found it alarming that the salesman was over looking the cost of the machine and telling me I would be more profitable.......

So I get rid of one guy.........2 weeks salary or there abouts is the monthly payment over some 5 years........

Oh, almost forgot.......not everyone owns land where they park trucks and run the business out of........so that increases monthly rent.

I never bought into a claim that something is going to save me X% or increase my profit by X%.......just like the window sticker on cars that show MPG in City and Highway.........Drop the number by at least 2 as to what you see on the sticker and that would be more realistic.


No doubt that some tools and equipment can and will make operations easier and or more efficient and in the end more profitable.......But a program.......I wasn't born yesterday...





The day before that

[Dale Wiley]

Maybe the add in question would care to tell how many companies are making a 30% net based upon their claims ??

I venture to say that there may be one company in the close vicinity of that company that may be realizing a 30% net ??

But then again, what net would you like to make ?? I can bop some numbers around and make any company make 30% net ??

What's that horrible smell ????

[agla]

I don't know about 30%, but knowing when you are making money vs. when you think you're making money is a huge deal. If you throw out a few jobs that you take on that you don't charge enough for, i could see someone who really does not know his numbers approach that pretty easily.

Having a software doesn't do it, but if it makes someone follow a system that teaches them the numbers, that easily could. The system without the software would do just as well. Some people need to be force fed practices.

Let's face it, this industry has as many people enter it every year with just basic skills of how to do the work and no concept of running the business. They throw out prices that sound good to them rather than basing it on hard data. Someone like that may net big on one job and lose on two others. At the end of the three, the bills are paid and he thinks he made money on all of the jobs. In reality, if he just did the one he wouldhave netted more money and had free time to hook up another profitable job.

Yes, I believe that if someone is far enough out of touch, a software that teaches a system could in fact raise that person's net by 30%. The question is whether someone that out of touch is going to be sensible enough to follow such a system.

Garbage in = garbage out.

Let's face it. Many of these softwares are just common databases and spread sheets that are preformatted to serve common needs of this industry. There is not much I have seen that you can't set up something that will do the same thing in common software. But, having a successful model to follow is not a bad thing.

[Stonehenge]

This thread was originally pulled from public view on 3/12/2006. It was pulled because the discussion was departing from the original topic, but more importantly, was departing from the type of participation we've become accustomed to here.

Because it was a Sunday and (despite out best efforts to the contrary) we do other things with our weekends than work or surf this site, we weren't able to address the issues as we normally do, catching them before they reach a boiling point. Instead it had to be addressed over a series of days. But we've found common ground.

Because we believe there is a valuable discussion in this thread, we've edited the off-topic material and are placing it back into the public forums. I would like to thank our moderator staff for the added work they put in getting this situation resolved – they were a great help in all of this, and I’d also like to thank everyone else for their patience with this issue.

With this situation behind us, let’s get back to work.

- Jeff

[Dale Wiley]

Thanks for putting this back up Jeff, theres some relevancy to be kicked back and forth.

Software is ANOTHER of the many tools that a landscape contractor uses in managing his conversion process. Making sure that your are inputing (sp, word ??) is the first step in making this tool work for you.

Making sure that you know in advance what you want to learn from this tool and how you will apply the knowledge you get is also very important.

You can input numbers and receive condensed and digested data, but knowing what to use and how to use it is the key factor.

Setting up a proper chart of accounts in your accounting software to make sure you are capturing and utilizing the important numbers, is one of thee first steps to make that software work for you.

I have used some proprietary softwares, but I operate with Quickbooks and my favorite , Excel. Keeping it simple is the main thing, and making sure you do not become dependent on that information as the sole basis for making management decision, but in utilizing it as one of the management tools to make collective decisions.

[Rick Carver]

Dale
I agree with you. In this thread I am actually not talking about any particualr software package but software in general.

What I am still wondering about is " OBVIOUSLY " harder for me to explain in text then it is talking about it,,,,,

But Let me try another way,,,,, I do not think any software can add to my net percentage. It can help to point out the things that need to be looked at due to the software specific compiliation (sp) of all the data that is stored and entered.... Comparisons if you will..... Also, the calculations of which will and should be compared to and against from another " BEGINING " source or as it has been stated already a benchmark.

This benchmark of course is your P&L.
Your chart of accounts are vital to understanding the reporting process of this TOOL,,(your P&L)

But why do so many companies still purchase so many software packages at thousands of dollars a pop and still do not do any better the they were before,,,,( blah blah blah,,,, I know I am ramblind here,,, but I am trying.) I bet after they purchase the program and pay for whatever training is needed to understand and run it, they are better at running their operation,,,, better tracking, scheduling, bookeeping etc etc,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,

But what about adding to your net? Yes I understand and AGREE, that by doing better and being more efficient within your operation using software, will help your numbers,,,,, but as far as I can see and understand and calculate,,,, no software will/can add to your net percentage,,,, even when helping with operational efficiencies.

Now,,,,, if a program were able to actually add any percentage to my NET,,,, would it not first have to calculate what I was willing to cut from my Labor and/or overhead percentages? But I really don't know of many companies who can roll back these cost's very easy, by like simply purchasing a software program,,,,, Saving money is what I'm all about,,,,,, for sure we all are,,,,,,,,,, What I am trying to understand is why can't any program do what I just questioned?

If my numbers are 40%OH and 45% Lbr and I have an affordable net of 15%,,,, and I want a 20% net,,,, please tell me the name of the program that will give me the 20%,,,,, Not ranting here,,,, I am wondering is all,,,,,,, and,,,,,,

Why can't a software program take my daily numbers,,, and departmentalize (sp) all other profit streams seperate from my labor numbers before it goes into my P&L? As it is, normally, it is a book keepers job to do this >MOST > VITALLY important piece of book keeping. If it is available now, I simply haven't heard of it,,,,, doesn't mean it isn't out there.(OK now I'm ranting) ;-)

Thanks to GTX for getting this thread back up,,,,

Rick

[Paul]

After spending ten's of thousands of dollars on software, not one can add to your net. Are they useful? Yes. Can you find errors with them, sure. Remember going back to the days B.C. (Before computers) We did payroll by hand, figured out how much was taken out of each check by hand and hoped we didn't make any mistakes, costing us big dollars if we did. Payroll then took one person a full day to do and write out or type checks, Now it takes all of 30 minutes! Savings?? Sure 30%, I think not!

How about book work, you know the stuff spread out over the office table? You get your courage up and sit down on Friday or Saturday night and finish up about midnight (with taking breaks to check on GTX) Let me tell you what it was like B.C. Mail would get delivered each day and you would compare the invoices to load tickets and post each one in a journal for the accountant to write checks for at the end of each week. Invoices would have to be tracked by hand and statements sent out on the 15th and end of the month. No just going to a screen and seeing where you are! That would have to wait until the accountant got done at the end of the month or quarter! Ok are we a bit closer now to adding 30% to our net? We are closer now but I still don't see 30%.

What has helped from my point of view, is the ease of information we get now. Plus the ability to track whats going in and going out! If we still put junk in,we will get garbage out.

It's up to you and how you run your company to become more profitable. Setting up job cost tracking, labor management, supplies, equipment needs, job material delivieries, ect, ect, ect, all lead to a more efficient and profitable company!

[Dale Wiley]

I don't think any of us can point to ONE thing and say this made my profits increase by 15%, or 12% or whatever.

That would be called the silver bullet , and as those of use longer in the tooth than others can tell you, the silver bullet does not exist.

Increasing profit is the result of MANY collective decisions and not any one thing. We made many changes in our business this year. We bought a top dresser for our sports field work, and it increased profit on that job, by over 20%. But that will not translate to a huge over all increase. In fact, if we step in it somewhere, and lose profit, it will become diluted real quick.

Incremental things add to the profit margin. Seconds make minutes, minutes make hours, hours make days, days make week, weeks make months and months make years. Lot of time there to make or lose improvements.

[agla]

OK, since we have 2 people representing a software comapay going back and forth telling us that they do not dramatically effect your bottom line, I'll bite.

Why should anyone want to buy such a software?

I hope I'm not going to feel like I'm in an infomercial.

[Rick Carver]

Agla

Who are the two?

I do want to make sure that my point regarding software isn't taken in the context that I am knocking every program out there.

I just like to think out loud on issues that seems to be "confusing" at best and maybe even "misleading",,,, to me anyway. LOLOLOL

I 100% believe that software can normally help folks who are needing support for a company that is growing in size and may be experiencing an behind the 8 ball understanding of their numbers both admin wise and field operation wise.

I 100% CANNOT understand why there is no software that can partner with an accounting program like Quickbooks, that will take your chart of accounts and help you set them up in the correct format,,,,, and automatically department or seperate OUT each different or additional profit stream from labor income?

I know...... watch and see now that I asked about it I bet it may be already on the market,,,,,,

Rick