The five numbers to know every Friday

Most people in the trades check one number: what's in the bank. It's the easiest number to see and one of the least useful. It tells you about last week, and it lies to you about today.

The account can look healthy because three customers paid the same week and you have not bought next month's material. It can look terrible on a Friday and be fine on Tuesday. Run on the balance alone and you'll panic one week and relax the next, and neither one will have much to do with how the business is doing.

Five numbers, once a week, twenty minutes. That is enough to know where you stand.

One: money owed to you, and how old it is

Not just the total. The age.

$18,000 outstanding sounds like one thing. Split into $14,000 invoiced in the last two weeks and $4,000 that has been sitting since August, it is a completely different picture — the first is normal business, the second is a problem you have been avoiding.

Write it in three buckets: under 30 days, 30 to 60, over 60. The over-60 bucket is the one to look at, and the rule is simple: anything in it gets a phone call this week. Not a message. A call.

Money gets harder to collect the older it is, and it does not get less old on its own.

Two: money you owe

Supplier accounts, the card, anything on terms, anything on finance. One total.

The reason to look at it weekly rather than monthly is that it moves without you noticing. A card balance that creeps up $400 a week is invisible in the moment and is $20,000 in a year. Seen weekly, the creep is obvious.

Then the number that actually matters — what is left after both. Bank, plus what people owe you, minus what you owe. That is roughly what the business is worth right now, and it is the real answer to "how are we doing," as opposed to the account balance, which is an accident of timing.

Three: work sold but not yet done

Your backlog. The value of jobs that are agreed and not finished.

This is the single best early warning you have, because it moves before revenue does. Revenue tells you about a month that has already happened. Backlog tells you about the month that is coming.

The useful form is not dollars but weeks: at your normal pace, how long would the agreed work keep you busy? Three weeks is comfortable for most one-truck operations. Under two is where you start quoting more aggressively. Over six, and you should be either raising prices or thinking about help — because at six weeks out you are losing work to availability, and the customers you turn away do not come back.

The reason this beats revenue as a signal: by the time a bad month shows up in revenue, the quiet period that caused it was six weeks ago and there is nothing you can do about it. Backlog gives you those six weeks.

Four: did last week's jobs actually make money

Pick the jobs you finished and compare what you charged with what they cost you — material, plus your hours at your real rate, plus any sub.

Most people never do this, and the ones who start are usually surprised. Not because a job lost money, but because the jobs they assumed were the good ones often are not. The big project with the long schedule frequently earns less per hour than the small repeat work nobody thinks about.

You do not need it on every job. You need it often enough to know which of your work types is actually carrying the business.

A worked example. Two jobs in the same week:

• A bathroom: charged $9,400. Material $3,800, 46 hours of your time, one day of a helper at $280. Costs are $3,800 + $280 = $4,080, leaving $5,320 for 46 hours — about $116 an hour for your time.
• Four service calls: charged $1,850 total. Material $390, 9 hours. Leaves $1,460 for 9 hours — about $162 an hour.

What each job actually paid you, per hour of your own time

One week, two jobs. The bathroom invoiced five times the service calls.

Bathroom — 46 hours

$116

Four service calls — 9 hours

$162

The bathroom is five times the invoice and looks like the better job. Per hour of your life, the service work earns about 40% more — and it carries less risk, ties up no money, and gets paid the same day.

That does not mean stop doing bathrooms. It means you now know something about your own business that you were guessing at, and it might change what you say yes to when both are on offer.

Five: what you actually paid yourself

Not what the business earned. What landed in your personal account this month.

This is the number people avoid, and it is the one the whole thing is for. It's entirely possible to run a busy, growing, profitable-on-paper business and pay yourself less than you made as an employee. The money is real. It's just sitting in the truck, in material, and in invoices nobody has paid.

Track it monthly against the floor you worked out when you started. If the business is busy and the number is below your floor, the problem is not effort. It is pricing, or it is money stuck somewhere, and the other four numbers will tell you which.

Do it Friday, not Monday

Friday, for two reasons.

You still remember the week. On Monday, Tuesday's extra two hours have gone.

And anything the numbers tell you to do — a call about an old invoice, a push for more quotes because backlog is thin — you can plan over the weekend and act on first thing Monday, instead of discovering it on Monday and losing the day.

Twenty minutes. The same twenty minutes every week, until it is a habit rather than a decision.

What to do this Friday

1. List what you are owed in three age buckets. Under 30, 30–60, over 60.
2. Total what you owe — suppliers, card, finance. Then work out bank + owed to you − owed by you.
3. Add up agreed work not yet done, and convert it to weeks at your normal pace.
4. Take one job you finished this week and cost it properly — material, your hours at your real rate, any sub. One job, not all of them.
5. Write down what you paid yourself this month and compare it to your floor.
6. Put the five numbers on one page and keep last week's next to it. The trend is worth more than the number.

You are not doing accounting. The accountant does accounting, months later, for the IRS. This is the weekly check that tells you which direction things are moving while you can still do something about it.