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QuickBooks Online for Construction?

QuickBooks Online (QBO) Plus can do enough for small contractors. Putting up with a few inefficiencies might be better than paying for expensive construction management software. First ask yourself: Are you willing to let all your project managers access QuickBooks? If it’s just one or two of you, having access to your accounting records is probably fine.

You can do job costing in QBO by setting up jobs as sub-customers. You can (in the Plus version) link expenses to a customer/job. You can run a Profit & Loss report by customer/job. Since this report shows revenue and expense accounts, you won’t be able to see a detailed list of the items used on that job. This is probably good enough. You can use other reports to get a list of items purchased for a particular job.

QBO does not do progress invoicing, but you can fake it. Create an estimate, copy it to an invoice, and delete the lines you are not currently invoicing. Go back and mark the estimate as “pending” again. Repeat the process next time you want to invoice. You may have to look back to see what you already invoiced before you create the next one. At the end, make sure the estimate is “closed.” Change orders require making another estimate.

You can set up a budget in QBO for each job and run a Budget vs. Actuals report for that job. Setting up budgets in QBO is a little awkward, but it works. It is also done at the account level, so you are more likely to have a “Materials” budget than a “12’ 2x4 budget.” You should ALWAYS budget, even if you find it easier to do in Excel or on paper. It’s the only way to improve your estimating accuracy.

With QBO Plus you can set expenses up as directly billable to particular jobs. Then you can add those actual expenses easily when you invoice rather than take a general line from your estimate. You can set markup percentages. QBO has finally gotten group items – they’re called “Bundles” now – that let you put a bunch of things in the group and only show the group total on an estimate or invoice.

You can also do quite a lot in the field with the mobile app. Your most likely use for the app would be to check invoices, estimates, and your cash balance. There is no scheduling, time, or location tracking.

I can help you work out the best and most cost-effective system for your business.

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