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KPIs - Construction & Retail Clothing Industries?

Does anyone have a list of valuable KPIs for the construction industry? How about the retail clothing industry?

Answers

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Wow, talk about divergent industries. Quick answer...

Common:

Metrics would include Sales, A/P, A/R, Cash, Inventory and slices there of, GP %

Differentiation would include

Clothing:

Purchasing, segmentation of both sales and purchasing

Construction:

Segmentation of Sales, Labor costs, equipment costs

Ted Bachman
Title: CFO/Controller
Company: Bachman & Associates
(CFO/Controller, Bachman & Associates) |

Wayne,

Thank you fro taking time to reply.

Ted

Chris Shumate
Title: Accounting Manager
Company: Dominion Development Group, LLC
LinkedIn Profile
(Accounting Manager, Dominion Development Group, LLC) |

Ted - For construction we track margin fade from the original buyout to where the PMs expect the job to finish at each month. We track the percentage of margin fade, who the PM was, what type of project, and how much the fade cost the company in gross profit.

We also track overbillings and underbillings in the same way. Some PMs are always underbilled, which the bonding company doesn't like to see. In the instance of underbillings we then track back reconciling items. For instance, the draw date may be on the 25th of the month, then on the 27th an invoice for materials was received that didn't get billed for. Sometimes the PMs blow it with their billings, other times it's timing on materials and other invoices received.

We measure bond working capital and equity calculations to determine where our financial health is for perspective jobs (will the bonding company be willing to issue a bond).

Of course, we measure the other standard ratios too.

Others to consider are:

1. Liquidity
2. Work backlog
3. Labor productivity (for self-performing work)
4. Schedule variance
5. Budget variance
6. Unapproved change order
7. Project cash flow
8. Committed cost indicator

Ted Bachman
Title: CFO/Controller
Company: Bachman & Associates
(CFO/Controller, Bachman & Associates) |

Chris,

Thanks you very much. If I can ever be of help to you, feel free to reach out to me. Ted

Topic Expert
Christie Jahn
Title: CFO
Company: Prime Investments & Development
(CFO, Prime Investments & Development) |

For the construction side we always look at GP % after complete. Did we earn our target profit and if not why? We also look at % variance to the budget/estimate to know where we ended up over/under budget, which then normally leads to change orders as Chris mentions.

In the retail side we measure productivity. This tells us who is really earning the most per hour. There are a lot of KPI's we measure in the retail side but I don't know they would apply to the clothing side (e.g. new activations, sales leads, repeat customers, etc.).

Topic Expert
Jaime Campbell
Title: Chief Financial Officer
Company: Tier One Services, LLC
(Chief Financial Officer, Tier One Services, LLC) |

Tell us more about (1) where in the company you are looking to measure as well as (2) what your goals are in measuring.

For example, if the goal in retail is to light a fire under the sales team, a KPI might be the number of customers who purchased divided by number approached, or the ratio of highest-revenue customers to total sales per rep.

If your goal is to create a healthier overall cash picture, then current ratio, days in A/R, and days in A/P - taken as a triad - comprise a winning KPI set in a construction company.

There's a huge variety - so tell us more and we can help you!

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