We asked some Big50 remodelers which one number helped them most to gauge their company's health.
Mark Scott of Mark IV Builders, Cabin John, Md., chose cash flow. “I try to keep it balanced, if not always positive,” he says. Scott acknowledges that for him, as well as for many other remodelers he knows, negative cash flow is periodically a fact of life.
Paul Winans, of Winans Construction, Oakland, Calif., watches his schedule like a hawk. “Even if it costs you more to be on time, you will make more money because you're free to do the other jobs you planned on doing,” Winans says. He notes that the ability to get jobs done on time translates into a positive, not just for his clients and his company, but for trade contractors and everyone involved.
John Deciantis, of Deciantis Construction, Stonington, Conn., shoots for a budgeted net profit equal to 10% of annual volume. He figures that if the company pays him a sufficient salary and still maintains a healthy net profit, everything is running well.