Contractor Profit Diagnostic

What is a contractor profit diagnostic?

Most contractors I meet can tell me their markup. Very few can tell me what one of their crew actually costs per hour once burden is loaded in, and that gap is usually where the money goes. The Profit Diagnostic is a fixed-fee look at the four things that decide your net profit: how you price and mark up, what your labour really costs, how your overhead is carried, and whether your job costing catches a problem before the job is over. You get an 8–12 page written summary with a prioritized 90-day plan, plus two calculators set up with your own numbers where the data supports it.

Industry context: the Construction Financial Management Association (CFMA) reports that 81% of contractors do not know their true labour burden, and only 19% set monthly overhead, profit, and sales targets. The diagnostic exists to close that gap with your own numbers — not a benchmark.

This engagement is not bookkeeping clean-up, tax preparation, QuickBooks setup, or business valuation. Those stay with your accountant. This is profit-and-pricing diagnostics, delivered by someone who has actually run construction businesses for 35+ years.

Who is this for?

The profit diagnostic is built for:

• Construction businesses doing $250K to $10M in annual revenue
• Solo operators through teams of about 30 staff
• Trades that bill by labour and materials — contractors, builders, electricians, plumbers, HVAC, restoration, custom homes, residential renovators, commercial fit-out
• Owners who suspect their pricing or burden is off but haven't quantified it
• Businesses with revenue growing but profit flat or shrinking

This is the right starting engagement if you're saying any of these out loud:

• “We did more revenue this year and somehow have less cash.”
• “Some jobs print money and some lose money and I can't predict which.”
• “I add 25% markup and I'm not sure that's enough.”
• “I don't actually know what one of my crew costs me per hour.”
• “My net margin should be higher than 3% — but I can't pinpoint why it isn't.”

If those aren't your questions, see the Systems Diagnostic or the Sales Pipeline Diagnostic instead.

What you walk away with

The deliverable is concrete. By the end of the engagement you will have:

• Your true gross margin and net margin computed and compared to construction industry benchmarks (CFMA reports industry average 3–5% net; top quartile 8–10%)
• Your fully-burdened labour cost per crew member — wages plus WCB, CPP, EI, vacation, stat holidays, benefits, RSP match, truck and tool allocation, and non-billable time loading
• A markup formula audit — most contractors who say “cost plus 25%” are actually producing 20% gross margin (not 25%); the summary shows the math
• A 3-job post-mortem comparing estimate vs. actual across three completed jobs, with root-cause analysis on the variance
• A cash flow rhythm review — deposits, progress draws, holdback, payables timing
• A top-three priority action plan for the next 90 days, sequenced and with owner accountability
• Two populated reusable tools you keep and reuse on every quote — typically a burden calculator and a markup/breakeven calculator, where the data supports it

The written summary is yours. Whether or not you continue working with Tumbleweed Consulting after the diagnostic, the summary and the tools are your property.

What's included

• Intake review of your last 12 months Profit & Loss, Balance Sheet, sample estimates, and three completed jobs
• Optional 15-minute call with your bookkeeper or accountant, by your invitation
• Margin and overhead analysis
• Burden-loaded labour cost calculation
• Markup formula audit using real numbers where available
• Cash-flow rhythm review
• Job-costing post-mortem on three selected jobs where records are workable
• One 60-minute findings call, recorded, with transcript provided
• Written summary, approximately 8–12 pages, with a prioritized 90-day action plan
• Two reusable tools populated with your numbers where feasible

What you need to provide

The intake takes most clients about 2 hours over 3–5 days. You upload to a private Google Drive folder we provide.

• Last 12 months Profit & Loss (PDF or QuickBooks Online Accountant invitation)
• Last 12 months Balance Sheet
• Three completed jobs — original estimate, actual cost summary, your gut feel on whether each made or lost money
• Your current pricing or markup formula (even if it's “I add 25%”)
• One sample current estimate to a real customer
• Crew list with pay rates, paid benefits, average billable hours, per-diem, truck allowance, tools allocation
• Top five overhead line items you can't explain or aren't sure about
• One paragraph from you on what worries you most about the money side of the business

If your bookkeeping is more than 3 months behind, the engagement pauses and we refer you to a bookkeeper. We do not run analysis on data that isn't workable.

How it works

Step	What happens	Timing
1	Free discovery call to confirm this is the right next step	Day 0
2	Agreement signed; 50% deposit ($750) paid	Day 0–2
3	Google Drive intake folder shared; you upload documents	Days 2–7
4	Analysis runs behind the scenes — burden calc, markup audit, 3-job post-mortem, cash flow review	Days 7–14
5	60-minute findings call, recorded, walks you through what was found	Day 14–17
6	Written summary delivered to your Drive folder; final 50% due on delivery	Within 10 business days of findings call

Total turnaround: 2–3 weeks from receipt of complete intake to written summary.

Pricing and payment terms

Fee: $1,500 CAD. Plus GST.

Payment: 50% on signing ($750). 50% on delivery of the written summary ($750).

Refund policy: Full refund if the intake review reveals the engagement isn't a fit. Once analysis begins, no refunds — but we work in good faith to deliver the summary you contracted for.

Credit toward Fast Track: 50% of the diagnostic fee ($750) is credited toward Contractor Fast Track if you start within 30 days of receiving your written summary.

What this is not

This engagement is deliberately scoped. It is not:

• Tax preparation — your accountant keeps that
• Bookkeeping clean-up — referred to bookkeeping network if needed
• Software setup or training — referred to specialists
• A guarantee that more profit will be found or captured — most clients find significant gaps, but the outcome depends on what you do with the findings