By David Thornton, chair, The Window Company (Contracts).

In August’s issue of Glass Times, Brian Gold from Jokita Software made some very valid comments about the need for glass businesses to really understand their costs in order to get their pricing and margins right and identify key areas for cost efficiencies.

I agree wholeheartedly and would say that applies not just to glass, but to the whole industry. If fabricators and installers in particular, had a better insight into their costs – and acted on that information, then it might help go some way towards slowing the hugely damaging race to the bottom on price which we invariably see every time market conditions get tough.

If businesses really knew the profitability of every job, then they would surely be less likely to offer prices which are unsustainable – even in the short term.

As a large commercial installer, profitability and cash flow are our lifeblood. We know our financial position every day – what we owe and what we are owed. And we know the real profitability not just of every contract but of every individual install – thanks to our bespoke database and accounting system.

We’re dealing with social housing contracts involving hundreds, if not thousands, of properties, so we can’t afford to get our pricing wrong.

There are obviously plenty of processing and accountancy software options available to help analyse costs and margins, but if you’re a start-up, even keeping a manual record is better than nothing. Selling one job too cheaply and realising it has cost you money is bad enough, but selling a 100 too cheaply, will very likely put you out of business.