CONCRETE · CONCRETE AND MASONRY · FIXED BY STEP 06

Eight Tons of Rebar Tagged to a Drawing That Changed

The EOR approved the placing drawings, the fab shop cut and bent to the bar list, and then somebody moved a footing. Now you own bundles tagged to grid lines that no longer exist.

WHY IT'S A CONCRETE PROBLEM

Structural steel can be re-detailed and re-sequenced into another package because it's still a member that bolts to something else. A bent #8 can't be un-bent, and no other job in your backlog has that bend schedule, so there's no salvage path and no transfer. You're also absorbing the delay twice, because the replacement release has to go back through detailing, approval, and the fab shop queue before a single truck moves.

WHAT IT COSTS

The size of it

On a package where reinforcing is 25 to 35 percent of the cost, one obsoleted release is a five-figure hit that goes into job cost with no revenue line against it. The replacement order restarts the 4 to 8 week clock while the GC is still holding you to the original pour date.

OVERHEAD AT $1M–$5M

14%

CFOS target 13% for concrete.

GROSS MARGIN AT $1M–$5M

21%

CFOS target 23.5% for concrete.

NET PROFIT AT $1M–$5M

CFOS target 10.5% for concrete.

Rebar doesn't come off a rack. A detailer produces placing drawings and a bar list, the engineer of record approves them, and only then does the mill or fab shop cut and bend to that list, typically 4 to 8 weeks after approval. Epoxy-coated bar and post-tension tendons run longer than that. Every bundle delivered has a mark number and a grid line, which is why it fits one job and nothing else. When a design revision comes through, a footing moves, or a slab thickness changes, approved fabricated steel becomes scrap tonnage parked in your yard.

WHAT TO DO

Three moves, in order

STEP 01

Monday, pull the approved bar list and the RFI log side by side for every open job and mark each release as still at the mill, cut and bent, or delivered.

STEP 02

Open a cost code for obsoleted fabricated steel so a write-off reads as its own line and doesn't disappear into general material cost.

STEP 03

The day a revision hits, send the change request with the fab shop's cut confirmation and the release date attached, not the PO date, because the cut date is what proves the steel is dead.

THE FIX

Step 06: Project management

Billing dates, change orders, and notices, written as standards that work without anyone chasing them.

CFOS-06 · CHAPTER 6

Billing and change orders that hold without chasing

What this step changes, what it depends on, and how to tell it's installed.

BENCHMARKS

Concrete by revenue band

All 7 bands are published. The CFOS target is beside the figure up to $10M to $25M, and the 4 bands above that are labelled modeled.

ACROSS EVERY TRADE

The change orders you did and never billed

The field did the work. The paperwork never caught up. Ninety days later there is no record that proves it happened.

SAME TRADE

What else costs concrete contractors money

CONCRETE · CFOS-06

The 28-Day Break Decides a Pour You Already Billed

You poured in March on an approved mix, the cylinders came back low in April, and two floors have already gone up on the slab in question.

CONCRETE · CFOS-02

Ten Jobs Used Those Forms, One Job Paid for Them

Your yard is full of panels and shoring, every job report says you made money, and the bank account disagrees. The form buy hit job one and jobs two through ten absorbed none of it.

CONCRETE · CFOS-04

Your Ready-Mix Quote Expired Eleven Months Before the Pour

Concrete has about a 90-minute working life from batch to placement, so your supply market is a haul radius with two or three plants. They quoted a market that's gone.

CONCRETE · CFOS-07

Done in June, Retention Releases When the Building Opens

Footings, foundations, and slab-on-grade are the first real dollar volume on the site, so you bill most of your contract early and then wait on a building you left a year and a half ago.

CONCRETE · CFOS-01

Six Trips Back for Pads and Sidewalks, One Unit Price

You were first on the site and you're still coming back for stairs, pads, curbs, and exterior flatwork, all priced inside a per-yard number that assumed you never left.

SAME MECHANISM, OTHER TRADES

The same mechanism in other trades

DEMOLITION

Your Breaker Burns Tool Steel That Overhead Pays For

A hammer chews $9,000 of tool steel on one teardown and the job that ate it never sees a dollar of the cost. The margin looks fine and the bank account disagrees.

DRYWALL

Lead-lined board is eight weeks and non-returnable

The imaging room's board is eight weeks out, cut to the shielding drawings, and the deposit is gone the day you release the order.

FIRE PROTECTION

The Pump Can't Be Ordered Until The AHJ Signs The Calc

You cut the pump deposit check in March and the truck backs in the next January, and every month in between your money is out with nothing on the pay app.

QUESTIONS

What concrete owners ask

Engineer changed rebar size after fabrication who pays?

The EOR approved the placing drawings, the fab shop cut and bent to the bar list, and then somebody moved a footing. Now you own bundles tagged to grid lines that no longer exist.

What does it cost?

What do I do first?

Monday, pull the approved bar list and the RFI log side by side for every open job and mark each release as still at the mill, cut and bent, or delivered.

What are concrete contractors supposed to be making?

Concrete runs 21% gross margin, 14% overhead and 7% net profit before taxes at $1M–$5M. The all-trade average is 7%, so this trade is right on it. The CFOS target is 10.5%.

Which part of the system fixes it?

The step is number 06, project management. Billing dates, change orders, and notices, written as standards that work without anyone chasing them. It comes from chapter 6 of CONTROL: The Construction Financial Operating System.

OR HAVE IT HANDLED

Everything on this page is something you can install yourself, and CONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for concrete contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, run by the same author.

What a fractional CFO does for concrete contractors

AUTHOR

JOSH LUEBKER

MASTER ELECTRICIAN · 150+ PROJECTS · $2.1B+ MANAGED

Wrote CONTROL, the 8 step system behind these figures. More about the author.