Why Your Construction Software Isn't Working (And How to Fix It)

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ℹ ABOUT THIS EPISODE

Think that sync button on your construction software is magic? Wade Carpenter reveals why most contractor software integrations fail and how to set them up properly. 

Learn the truth about QuickBooks syncing with Procore, Buildertrend, and other construction apps. Discover how to avoid duplicate entries, set up cost codes correctly, and create workflows that actually save time instead of creating more work for your business.

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⌚️ Key moments in this episode:

• 00:36 The Reality of Construction Software
• 01:20 Understanding Third-Party Apps
• 05:44 The Importance of Workflow and Syncing
• 07:36 Common Pitfalls and Solutions

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Wade Carpenter, CPA, CGMA | CarpenterCPAs.com
Stephen Brown, Bonding Expert | SuretyAnswers.com

Transcript

Wade Carpenter: [00:00:00] Everybody thinks the sync button on that shiny new construction software is magic. Push it and your books are perfect. If that were true, I could just sit on a beach sipping an umbrella drink while QuickBooks and Procore held hands and sang kumbaya. Spoiler alert: they don't. Instead, it's usually like a food fight and you're the one stuck cleaning up the kitchen.

Welcome to the Contractor Success Forum. I'm Wade Carpenter with Carpenter & Company CPAs. Alongside Stephen Brown with McDaniel Whitley Bonding and Insurance, today we're diving into the claims of that software salesman that sold you the fix for everything in your world. Yet here we are, been paying a monthly subscription for two years and you still don't have it set up right. Stephen, what are your thoughts to kick us off on this one?

Stephen Brown: I dunno. I just love the idea of you drinking umbrella drinks and singing kumbaya. Hey what a great topic. It's not magic is it? Mastering any software takes some certain level of headache, right? Thanks for this topic. Maybe [00:01:00] it'll take some headache away from some folks that have been struggling with this. 

Wade Carpenter: We did an episode maybe two years ago on the cost code structures and things like that. And that's one of the questions I get all the time. So that's why I've had to try to figure out how to help contractors without them having to spend thousands and thousands of dollars to figure out how to do this.

So this particular topic all plays into it. Let me set the stage with why these third party apps exist. And again, I'm not picking on any particular software, but QuickBooks Online is one of the most common ones we see and they're not really built for contractors.

They're not set up to do job costing in spite of what that Intuit salesman tells you, it is not built for contractors. So we have all these add-ons like Procore, or Job Tread or Buildertrend, or a JobNimbus. There's tons of them. And these are some we see all the time and we need these other softwares.

And there's things that they do very well for a contractor. But the short answer to this is those are not designed [00:02:00] to replace your accounting system and the job costing even though they say it's going to. So that's where I'm going with this. I think we could need to talk about what these other softwares do, where they do shine' cause there's a place for them. But what are your thoughts on that?

Stephen Brown: It's just amazing to me all the different products that are out there and trying to understand which ones to use. And to me, you would think go with the product that's been around the longest because they have perfected the art of making it easier to use over the years, and that's not true either. 

Wade Carpenter: Well, it's not and it depends on your industry. There are certain things that are built for a different type of construction. Some of them, they're built for dealing with your customer, or you're the general contractor doing the estimates and the pay side of that . Some of them are also built to where, supposed to be controlling your subs and controlling your materials and purchase orders and those kind of things. As well as there are other ones that, maybe you got an electrical contractor that does big jobs that may take one type of work, like a [00:03:00] Procore or something, versus Electrical Contractor that does a lot of service work that may need another one of these things. I'm not picking on or recommending any particular software, but they have different purposes.

So this is why we need some of this stuff because you can't really get the good job costing, but they lead to this fallacy that you can get really good job costs by using their software. They have some great purposes. We can talk about those.

Stephen Brown: I do think of you Wade as a job cost ninja or samurai. You are a warrior in job costing. And it's not a fluke that you're so passionate about it, because you want our listeners to understand these concepts. It's not like you want to have to deal with them every day. You want to move on to other things as well.

But this whole concept of getting software as a tool to help you track your job costs, and letting things sync up, work a little bit automatically. We keep talking about AI and other things that can be used to help construction companies, but the implementation of it [00:04:00] is another matter, isn't it? 

Wade Carpenter: Yeah, it is. And if you buy something like a Sage 300 or something like that construction real estate, you can spend tens of thousands of dollars on the software alone. Then you're probably going to have a consultant to get it all set up and integrated and all that stuff.

Somebody starting in QuickBooks, they need some of these same functionalities that are not built into QuickBooks. So some of the functionalities, as we already said, is dealing with the customers generating estimates and invoices. As well as controlling your subs, creating purchase orders, and dealing with your bills and trying to do your job costing.

Some of them also have things like trying to attempt to cost out your payroll, but again, they're not payroll systems, they're not accounting systems per se, but they lead to this fallacy that hey, everything's gonna sync with QuickBooks and everything is gonna be hunky dory.

Going back to these things, I mean, QuickBooks alone, again, I'm coming back to QuickBooks. I'm not picking on QuickBooks. But QuickBooks Online particularly, does not have the same functionality I've [00:05:00] said a thousand times as QuickBooks Desktop or Enterprise. They're throwing that enterprise term around loosely right now because they've got a QuickBooks Online Enterprise.

But the desktop version, it's a tool. And the idea is how can we get the data in one place so that you can see as close to real time how we're doing on a job, versus, we figured out six months later, or we have to take it from here and then we go manually pull it out and write it down on a tablet or put it in Excel or however we wanna look at our jobs. But it's a tedious thing and it's not something that we can do very quickly.

Stephen Brown: You're saying it's difficult, but if your dream is to lay on the beach with an umbrella and have everything sync up perfectly, how would you go about getting to that point? 

Wade Carpenter: Well, this is where I wanted to go with part of this episode is what actually syncs? So what are we talking about syncing? Do we have you know, our estimates and the bills? Our purchase orders and the invoices that you send out to your customers. We have these job [00:06:00] costs codes that we talk about all the time, and that's one of the biggest hurdles here.

But, what I wanna talk about right now is what syncs, but the direction it syncs. Some of them will work, like they'll sync invoices over to QuickBooks, but then the payments go back, or they generate the bills and those are supposed to go into the builder trends, again, I'm not picking on anything in particular, but which way does it sync?

Some of them will sync both ways. You would think that would be great be cause everything's always in sync and everything's always real time and up to date and it eliminates dual entry. That's one of the biggest things that we're looking for is we're not gonna spend thousands of hours making sure things are in both places or spend a bunch of hours trying to manually come up with how did we do on that job?

I hope I'm making some sense here, but when you're considering what software you have and what you're buying a software for, you need to see which way it syncs. That's one of the considerations I've had to do when working with contractors is if we're gonna support them, [00:07:00] which way does it go?

You need to figure out your workflow. Some of them will only go one way like there's a different type of sync for QuickBooks Online versus a QuickBooks desktop, and some of them are very different for the different products. Even between the same product that syncs with desktop, may not be the exact same thing as online.

Does that make any sense whatsoever?

Stephen Brown: It does, it makes perfect sense. I'm so glad you brought that up. I certainly wouldn't have known that. What do you recommend to someone? You've already got a system in place that's not syncing up properly. You've got one of our listeners that wants to set up a system that's more user friendly. What advice would you give them? 

Wade Carpenter: Well, too often we have people that come to us that paid for this software for two years straight and they aren't any farther along than the day they bought the software. The number one thing before you even consider syncing anything, a lot of these software already have a baked in chart of accounts. And if they're generic, we've talked about it a million times. It's like, okay, the CSI master code format, there's 20 pages of [00:08:00] codes. And we have this analysis paralysis, we go way too detailed. And we may want all that detail when we're bidding the job, but we're not gonna track our costs that way.

Or are we gonna have somebody bidding a job, but when they go costing this out, they pick some other cost code, then nothing lines up? That's one half the battle. Number one, you gotta figure out what that cost code structure is in one place, and it's got to mirror the other. That's the number one first step that I see go wrong. Gotta get that part in place number one. 

Stephen Brown: Okay. 

Wade Carpenter: And then I would say number two is, long story short, I will say a lot of these syncs do not work as intended. You would think everything would just go back and forth and we often see a lot of these things cause duplicates. Duplicate invoices or duplicate payments.

I've got one particular we're dealing with right now, they're insisting on syncing and it goes one way. This is Buildertrend in this particular case, they make an adjustment in Buildertrend for just a line item or just a comment on a bill. Well, it [00:09:00] duplicates the bill in QuickBooks. And so, you would think those things are okay they're synced up. No, it brings it in twice.

And this is one of the biggest things I rail about because it can wreck a set of books in a heartbeat. It really can, and can take hours. And even we've had some problems where it can take days to fix some of these things.

So that's what I'm trying to do is educate people on, number one, getting it set up right, the structure, but knowing what it's gonna do and is it really best to try to get it in both places? It all sounds great, but are you really doing double work? Are you putting it into the Buildertrend or Job Tread, and then expecting it to filter over to the QuickBooks and then the payment?

So many of these things are using the word sync, but they don't get where they're synced up, I guess. I guess I would say. But again, you gotta think about the workflow. 

Stephen Brown: You gotta think about the workflow. Elaborate on that a little bit more. You were just talking about the workflow and the codes being in sync. 

Wade Carpenter: Yeah. [00:10:00] That's one of the setup things. After you get past that hurdle, you gotta figure out which way does the data need to go? And understand what's gonna happen. Like in particular case, I was talking about on Buildertrend, it only goes one way. So when you end up having these duplicates like that, it's frustrating because you got, in her case she had duplicate payables. And it can make a big mess.

But having some safeguards on that. And you got differences in the way these things work. Some of them like QuickBooks Online, they're almost supposed to be real time, versus the way, some of them are more of a manual sync. You have some of the Sage products as well as the QuickBooks desktop. Some of them you have to do a little more manual, but they do sync.

This is one of the things that I have sort of learned as I'm explaining some of these things to contractors. I'll draw it out. If you show the workflow, and I was just going through this with a contractor on our payable system and how that works.

I don't mean to go too far afield on this one, but this is a key thing that you really should know about this. Our payable system, it can come in one way, or you may get [00:11:00] a bill handed to you in the field by the sub on the job, it may be riding around a truck or it could get emailed to you, it could get mailed to you, and then how do you get it in the system? Maybe you're scanning it versus dealing with all this paper and we've got ways to get it in by emailing it in or by dragging and dropping, and we make it as simple as possible, but it has to go into a certain place where we code it and get approvals on it.

Does it go into QuickBooks? With that it's already cost coded as well as at that step, if you got purchase orders, if they're putting that on the job, we can do the job coding a lot faster if the vendors will get that kind of stuff on there.

Then once it's in QuickBooks, our system also syncs with that part and now we can pay it from the other system where we also had the same contractor I was talking about, they go in and manually key these things. So one of my people was having to come back and say, okay, what did you pay this day?

So we had to explain to them visually, and it saves so much time and effort if you can [00:12:00] understand, hey, these are all the moving pieces. And in our case, we had 8 to 10 moving pieces and we brought it down like four. We saved a ton of time and effort just by explaining to them, and it's very hard to visualize some of these things unless you draw it out.

So that was completely off the idea of where I was going with this episode today.

Stephen Brown: No, it is exactly what I wanted to hear. It was the direction that I was more comfortable understanding, being in a non accountant. The first thing that popped into my head was your comment about a sub giving a job foreman and an invoice that could be riding around in a pickup truck. That's crazy by the way. Don't do that. 

Wade Carpenter: Well, it happens all the time. 

Stephen Brown: Course it does. 

Wade Carpenter: Then we also have several of them that will text them in or they'll write up, I've got some right now, we're handwriting on a piece of notebook paper, and then they take a picture of it and they're sending us that. There are subcontractors that are not as sophisticated, we understand that, but you need to figure out the flow.

That particular case there with accounts payable is [00:13:00] one of the biggest things that I rail on all the time is okay, it can't sit and ride around in your foreman's truck for weeks on end before you decide to turn it into accounting. Number one, you need to get it in the system and get it as real time.

You may not wanna see that bill or pay it, but you need to know what you got on that job. After you close out the job and you sent the final invoice, they bring you that final bill from the sub or whatever, then you can't capture that. I see it all the time. Our goal is okay, we need the workflow to be as real time as possible and make it simple for everybody.

So sometimes we'll build apps to where they can take a picture on their phone and tie it to the job. Because otherwise they're not going to bring all those paper receipts back.

But anyway, I got off on a tangent here. Again, my goal is to like, how do we protect the books? How do we get you good information so that these things don't happen. There are some times that we will actually rather extract it manually or we have some ways backend ways to get [00:14:00] some of the stuff in if they're insisting on them putting it in. But we would rather make it all flow together, if that makes sense. Had one source of truth that this is where we are and anyway, that's the goal of this.

The flow of these third party software, you need to pay attention to what pieces you're gonna be using. Get that cost code structure set up properly, and then figure out, what are the things that-- some things may work fine like bringing an invoice over while they have credits or something like that. The credits crash the system if you do them improperly. So there are nuances to all this. And I'm sorry, I'm just, I'm geeking out here based on, just years and years of seeing these problems. And again, none of this was to knock Buildertrend or Job Tread, Procore, any of them. Because they do have their places. 

Stephen Brown: No, I totally get it, Wade. I think as I listened to you talk about it being a non accountant individual, the thing that hits home with me so much is you gotta set it up right and then you got to [00:15:00] test it. You have to test it and tweak it to make sure it's working the way you want to. And then you gotta know enough about accounting to see which red flags tell you your system is not syncing up properly and then what to do about it. 

Wade Carpenter: Yeah, we talked about like nail guns and how they've saved a lot of labor over the years. You can just hit that sync button on your software versus just you can hit the trigger on that nail gun. But if you don't have the nail gun pointed at the lumber and you end up shooting yourself in the foot, that's what I end up seeing too often. 

Stephen Brown: That's a great analogy. You can't operate a nail gun from the beach with an umbrella drink. I get it. No matter what happens, you have to put work in your systems. What's that old saying about plan your work and work your plan?

Wade Carpenter: Yeah. Well, again, I know people pay tens of thousands of dollars to consultants on setting some of these big systems up. And a lot of contractors cannot afford that one. I know that. But that's why I was trying to set up a way to give people some good [00:16:00] information, I hope. And, we were spinning up the jobcostsamurai.com website, trying to get some information to people in a cheaper way to do it as opposed to paying consultants thousands of dollars.

So that was one of the hopes from this episode, that if nothing else I made you think. If you're still pay for that software for years and it's costing you quite a bit of money, but it's really not benefiting you, is it time to go get more software or are you just gonna walk into the same thing? Don't get sucked in by a salesman that says it can do everything, but then you end up, I've see them all the time, they swap software and they're back in the same boat as they were before because they never figured it out.

Stephen Brown: I get it. Great advice, Wade. Thank you. 

Wade Carpenter: Okay. Well, if any of this hit home for our listeners, we'd love some comments. Have you seen these syncs trash your system? Are you still having problems with setting it up and not seeing the forest for the trees as far as the cost codes? What problems are you having? What software are you using? We'd love to hear some of those things in the comments [00:17:00] below.

We do this every single week, and our goal is always to help our contractors understand, and inform them on things that can make a difference in their world. So, if you would, we ask that you like, share, subscribe, it always helps us out. And we will see you on the next show.