Your labor costs are 40% when they should be 32%. That gap signals missing roles, overextended staff, and broken processes. Check your chart of accounts, organizational chart, and accounts receivable to find where money is leaking.
Is there specific things that you usually see or things that are like red flags? So simple. Their chart of accounts isn't set up. The main thing to know is what's your gross profit? And if the chart of accounts, if you got direct labor down in overhead, we don't know what your gross profit is, right? So it's getting that straight, then exactly looking at, hey, your labor's running at 40% when typically in the industry it's at 32%. We need to talk about what behaviors are driving that. Most of the time they're missing a key role where they're all overextended and processes are breaking down. I think the biggest one would be AR. These owners love to have their money sitting out on the street. When you do that financial review, you look at the balance sheet and you see how much is actually sitting out there. So you look at the org chart, understand the players, and then develop a plan of attack from there.
