A WIP schedule that doesn't take three phone calls
Most capacity reviews for a construction contractor slow down on the same thing: a principal who can't produce a current WIP schedule that agrees with his own financial statements. CONTROL: The Construction Financial Operating System installs the job costing that fixes it, which is a better gift for a contractor you want to grow with than anything printed with your firm's logo on it.
The numbers, not the character
A principal's character and his experience are usually not the question. The delay comes from the paperwork: a WIP schedule built from memory, not maintained monthly, overhead priced off a number left unchanged for three years, job costs that don't reconcile against the P&L a reviewed statement is built from. None of that reflects badly on the contractor's ability to build. It reflects a construction company running its books for tax purposes, not for the decisions a surety actually needs to see.
More on the mechanism behind a stuck ceiling is on bonding capacity stuck at the same number.
8 steps, six templates, sixty days
What agents ask before sending it
Why would an agent buy a book for a contractor they bond?
The underwriting is only as good as what the principal can produce, and most of the friction in a capacity increase isn't the contractor's actual financial strength, it's how long it takes to get a current WIP and a straight answer about overhead. A principal running real job costing produces both in a day instead of a week.
Does this replace the financial statements a surety already requires?
No. Reviewed or audited statements are still the requirement. This is what produces a WIP schedule and job-level numbers that actually agree with those statements, not contradict them, which is the thing that slows down more capacity reviews than the underlying numbers do.
What's the actual mechanism? Why does this move capacity?
Working capital and net worth are two of the three C's a surety weighs, and both improve when a contractor stops pricing jobs off a guessed overhead rate and starts running cost codes that match the real cost of the work. The book installs that structure in 8 steps. It doesn't manufacture capital, it stops a contractor from losing margin he'd already earned.
Is this a good gift for a principal I want to grow with, specifically?
That's the clearest case for it. A contractor who outgrows his current bonding capacity is usually the one worth the relationship, and giving him the system that gets his numbers ready for that conversation is a better use of a client gift than anything with your logo on it.
What size of contractor is this actually built for?
Under $1M to $100M in revenue, doing commercial progress-payment work, the same kind bonded work is: retention, pay applications, and work in progress. It was written for this kind of job specifically, not adapted from a general business book.
Where can I check a published bonding capacity number before I talk to a principal?
The bonding capacity ladder on this site walks through how the formula moves as working capital and net worth change, on <a href="/pain/bonding-capacity-stuck">the page about a stuck capacity ceiling</a>.
$9.99 ebook, $24.99 paperback
Paperback if you want it on his desk instead of buried in an inbox. Six chapters include a QR code straight to a working file.
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Wrote CONTROL, the 8 step system behind these figures. More about the author.