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Job Costing: Stop Leaving Money on the Table!

In a world where there continues to be pressure impacting labor and supply chains, how do you know if you are optimizing profitability? With inflation at its highest in 30+ years, if you do not have a tight handle on your costs and profitability your business is eroding value. With proper job costing practices using ERP software technology, you can accurately reflect costs in real time ensuring your business is maximizing profit.

Some of the common pitfalls seen with companies attempting to accurately job cost are the use of outdated input costs or lack of real time data when using third-party accounting software.


The use of ERP helps solve these problems because it provides your employees with the information to quickly adapt and optimize margin. The benefits of an operations-based ERP system are that you can continuously reflect accurate input costs allowing your sales and operations team to quote work profitably. The common issue for companies is to quote jobs under their target margin because they are not incorporating real time landed or maintenance costs. In today’s market these factors can have significant impact on cost of goods sold. Lacking this accuracy does not set a company up for success.


However, to accurately job cost while you are manufacturing or providing services you need to ensure all costs of goods are correctly associated with each job. There are the obvious things such as labor, maintenance and inventory but what is often missed is 3rd party or unexpected costs such as waste, scope changes or estimation errors. With an operational based ERP system, you are recording all these COGS in real time, ensuring your true costs are reflected. Therefore, when you invoice your customer, you immediately understand your job profitability and can make changes to all your subsequent quotes and price lists. The power of visibility in real time allows you to operate nimbly in a fast past environment and maximize profit.

A lot of accounting systems tote the ability to job cost but unlike an operations focused ERP like Discovery Solutions DMS, they are not pulling the level of detail required to truly grow and optimize your business. For example, if your operations and financial accounting system does not have the granularity to tag the use of WD40 or understand exactly which WOs or POs are tied to a specific job, your ability to accurately job cost is limited. This means you are mostly likely leaving money on the table.

At Discovery Solutions we have been helping service companies optimize their profitability for over 35 years. Our ERP solution can job cost with high levels of accuracy at the individual job or manufactured item level. We also have the ability to track profitability by customer, project, field, well location and much more. Being focused on operations provides our customers the full suite of tools needed for unmatched job costing ability.