263 - Why Your 40% Margin Becomes 33% (And How To Fix It) The Cash Flow Contractor podcast

263 - Why Your 40% Margin Becomes 33% (And How to Fix It)

3d ago 36:30

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Think your 40% profit margin is solid? Think again. Martin and Khalil expose the hidden costs that eat into your profits—and show you how to stop the bleed.

Time Stamps

00:56 - Martin's Client's Issue
02:14 - Understanding Variable Expenses
03:30 - Allocating Costs and Overhead
05:27 - Realizing the Impact on Profit Margins
18:08 - Employee Compensation and Tariffs
18:44 - Bulk Purchases and Inventory Challenges
22:33 - Understanding Burdening in Business
33:46 - Practical Steps to Improve Bidding Accuracy

Snippets from the Episode

“You bid everything just fine, but then you look at your books and you're not making any money. Something’s off—and the good news is, it can be fixed.” - Martin Holland
“If you’re bidding for 40% and you’re not seeing that in your gross profit margin, you’ve got to find the difference. That is management.” - Martin Holland
“Nothing’s worse than thinking you’re going to get something and coming in 7% lower. That’s more than just a rounding error—that’s a business risk.” - Khalil Benalioulhaj
“You could be winning bids while losing money. When you fix your pricing, you gain margin on every future job without chasing more sales.” - Khalil Benalioulhaj

Resources

CFC 249 - The $600,000 Accounting Error That Almost Destroyed My Business with Cory Parks
The Break-Even System by Spencer Tucker

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