We look at a lot of contractor P&Ls. Most owners aren't bad at the trade — they're bad at the gap between revenue and what actually lands in their personal account. Here are the seven leaks we see most often.
1. Treating one bank account like a budget
If "how much can I spend?" equals "what's in checking right now," you will always be one bad week from panic. Open separate accounts for Profit, Owner's Pay, Tax, and Operating. The bucket tells you the answer — not the balance.
2. Pricing off cost, not capacity
Materials + labor + 20% sounds safe. It isn't. It ignores trucks, insurance, callbacks, and the weeks you can't bill. Price off the margin you need to fund all the buckets — work backwards from there.
3. Running payroll out of "whatever's in checking"
Payroll is the most predictable expense you have. It should be pre-funded from a dedicated account, not raided from deposits. If a slow week means you can't make payroll, the business is already underpriced.
4. Mixing owner draws with operating spend
Swiping the business card for groceries makes the books a mess and your tax return a guess. Pay yourself a steady draw or salary — then live off your personal account like a normal human.
5. Letting receivables age past 30 days
Every day a $10k invoice sits unpaid is a day you financed your customer for free. Invoice the day the job closes. Auto-remind at 7, 14, 21. Charge a late fee that's actually on the invoice.
6. Not knowing your real labor burden
That $30/hr tech costs you closer to $42 once you load workers' comp, FUTA/SUTA, employer FICA, and PTO. Bid off the burdened number or you're losing money on every hour you sell.
7. Treating tax season like a surprise
Set aside 15–25% of every deposit into a tax bucket. When April shows up, you write a check from money that was never yours to spend. No payment plans. No penalties. No stomachache.
Fix three of these and your "I make great money but never see it" problem usually disappears in a quarter. We help contractors in CA, NV, and AZ wire this up — payroll, buckets, and owner pay handled without you babysitting QuickBooks.
