DRYWALL · INTERIORS AND FINISHES · FIXED BY STEP 01

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.

WHY IT'S A DRYWALL PROBLEM

For most trades the long-lead item is equipment like switchgear or a rooftop unit, something the GC is already tracking on a submittal log. Yours is sheet goods, which everyone on the job assumes comes off a rack at the yard, so it never makes the long-lead list and the question never reaches you until the floor is ready for board. The board you're waiting on is cut to a room that hasn't been signed off yet.

WHAT IT COSTS

The size of it

You buy a $40k made-to-order package in month two on a job that bills it in month seven, and you write off any piece a redesign kills. Miss the order date and that one specialty room drags the whole floor's closeout.

OVERHEAD AT $1M–$5M

13%

CFOS target 12% for drywall.

GROSS MARGIN AT $1M–$5M

19%

CFOS target 22% for drywall.

NET PROFIT AT $1M–$5M

CFOS target 10% for drywall.

Order specialty board off the document that releases it, because the construction schedule will always tell you the wrong date. Half-inch board is a two-day item, so lead time never goes into a drywall job until that job has imaging rooms, shaft walls, or a specialty acoustic assembly. Lead-lined gypsum is fabricated to the shielding drawings, runs six to twelve weeks, and can't be ordered at all until a physicist's shielding report is issued and approved by people who don't work for you. Shaftliner, abuse and impact resistant board, glass-mat exterior sheathing, and specialty ceiling systems all quote long, and none of them are stock returns. So you order early, eat deposit and freight, and if the room layout moves, the material is scrap.

WHAT TO DO

Three moves, in order

STEP 01

At buyout, mark every non-stock board on the submittal log with its quoted lead time and the specific document that releases the order.

STEP 02

Ask the GC in writing for the shielding report date and get it entered into the schedule as a dated constraint you can bill delay against.

STEP 03

Set the specialty package up as its own cost code and its own SOV line so the $40k reads as material bought in month two, not as a hole in the job's gross.

THE FIX

Step 01: Job cost structure

Seven cost categories and three levels of granularity, built so the estimate and the ledger use the same words.

CFOS-01 · CHAPTER 1

Job cost codes that match how you bid the work

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

BENCHMARKS

Drywall 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

Cost codes the field ignores

You have 200 cost codes. The crews use four of them, and one is called Miscellaneous.

SAME TRADE

What else costs drywall contractors money

DRYWALL · CFOS-06

You Go Back Six Times And No Ticket Gets Signed

You hung the corridor in March and you're still sending a guy back in June, one hole at a time, on somebody else's dime.

DRYWALL · CFOS-06

Rough-in inspection owns your start date

Twelve hangers report Monday, rough-in failed Friday over three missing straps, and you pay all twelve to wait in the parking lot.

DRYWALL · CFOS-04

Your contract holds two commodities and hedges neither

You bid it in October off a quote good for thirty days, and you're buying board and studs in March on two markets that move separately.

DRYWALL · CFOS-01

The eleven-month callback hits this year's payroll

It's March, two of your best guys are in a truck all month fixing houses you finished last spring, and none of those hours bill.

DRYWALL · CFOS-04

Level 5 gets discovered after the primer goes on

The spec said Level 4, the owner walked it at night with the wall washers on, and now there's a skim coat between you and your retention.

SAME MECHANISM, OTHER TRADES

The same mechanism in other trades

CONCRETE

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.

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.

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 drywall owners ask

How far ahead do I have to order lead lined drywall?

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.

What does it cost?

What do I do first?

At buyout, mark every non-stock board on the submittal log with its quoted lead time and the specific document that releases the order.

What are drywall contractors supposed to be making?

Drywall runs 19% gross margin, 13% overhead and 6% net profit before taxes at $1M–$5M. The all-trade average is 7%, so this trade is 1 point below it. The CFOS target is 10%.

Which part of the system fixes it?

The step is number 01, job cost structure. Seven cost categories and three levels of granularity, built so the estimate and the ledger use the same words. It comes from chapter 1 of CONTROL: The Construction Financial Operating System.

OR HAVE IT HANDLED

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

What a fractional CFO does for drywall contractors

AUTHOR

JOSH LUEBKER

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

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