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Examples of items for contractors

For a contractor, items are used for estimating, invoicing, and tracking job costs. The way you set up your items depends on multiple factors, primarily your estimating strategy and the way you would like to view your job cost reports.

When creating items, remember that the level of detail in your Item List determines the level of detail in your. More detail gives you more information on reports, but keep in mind that you may not want to create items for such things as 2x4's and 16 penny nails. If you do, then the person who enters the lumber supplier or hardware bills will have to break each item on the bill down in that fashion, which could become an extremely time-consuming task with a high margin for error. You might want to keep categories as generic as possible, keeping in mind that you can type special notes into the item description field of the estimate.

You will typically create items for job phases. You might also use subitems, inventory items, or group items.

For examples of how to set up items, choose how you generate estimates:

I generate estimates in QuickBooks
I generate estimates outside of QuickBooks

Setting up items if you generate estimates in QuickBooks

If you plan to use QuickBooks to create job estimates then you should enter a standard set of items that you will be using on a routine basis. For example, let's say you want to set up an estimate template in QuickBooks and you want that template to remind you to capture all the costs of fees and permits. You might then want the first section of your Item List to look something like this:

 01.10 Fees
   01.11 Fee – City License
   01.12 Fee – Plan check (general)
   01.13 Fee – School district
   01.14 Fee – Sewer assessment
   01.15 Fee – Miscellaneous
   01.16 Fee – Environmental health
   01.17 Fee – Parking
   01.18 Fee – Utilities tie-in
 01.20 Permits
   01.21 Permit – Building
   01.22 Permit – Demolition
   01.23 Permit – Miscellaneous
   01.24 Permit – Electric        

By listing every fee or permit cost that might happen on a project, you are helping yourself (or the estimator) to capture all of the costs of a project. In other words, you are helping to insure that costs don't slip through the cracks.

In the example above, you would create both Items (01 Fees & Permits) and two levels of subitems (01.10 Fees and 01.11 Fee – City License).

Setting up items if you generate estimates outside of QuickBooks

If you plan to use an outside estimating program or spreadsheet for detail estimates and to then bring a summary estimate into QuickBooks, you should set up your Item List to reflect your standard list of summary estimate phases. For example, if you use an estimating program that uses the 16 CSI (Construction Specifications Institute) phases to break down a project into small segments, then you would set your Item List to reflect those 16 phases.

One example of a partial Item List for a remodeling contractor might look like this:

01  Fees & Permits
02  Site Work
03  Excavation
04  Concrete
05  Masonry
06  Framing
07  Exterior Trim
08  Siding
09  Doors
10  Windows
11  Plumbing

The partial list above represents a typical list of standard phases for a remodeling contractor. (Other list items would include HVAC, Electrical, Insulation, Floors, Painting, Cleanup, Landscaping, Supervision, Finance, Moisture Protection/Roofing, and so on.) The detail for each of the line items above are not going to be brought over into QuickBooks, but instead will stay in the estimate that was created outside of QuickBooks.

You can also have subitems below each item in the list, as shown in the section on setting up items if you generate estimates in QuickBooks. Your Item List should represent the level of detail you want to bring into QuickBooks estimates, which should be the same level of detail you want to see in your job cost reports.

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