Crosswinds Communities, a production home builder, had no accounting software or automated systems at all, including no systematic way to track costs and profitability.
So the company turned first to Sage Timberline Office's accounting software and then signed up for Sage Timberline Office's production management.
Software "shows us the data"
Keith Kallen, Crosswinds Communities vice president of business development, says the changes have made the company more cost-conscious as an organization because they now have detailed information available. "Before Sage Timberline Office and production management, people had ideas of what they thought was happening, but we needed to see the data."
"Sage Timberline Office gave us the opportunity to track costs and profitability on a job-by-job basis," Kallen says. "It's huge because the entire discipline of budgeting and tracking costs was implemented, and people actually knew where they were and they were able to write their budgets on a go-forward basis with real information that was readily available from the previous month and the prior quarter."
Complete lot-by-lot management to development
Thanks in part to its new ability to manage its costs and profitability, Crosswinds Communities quadrupled its business over a 10-year period, growing from 250 homes per year to over 1,200 homes per year in Michigan, Florida, California and Arizona, grossing $160 million per year.
"Sage Timberline Office's fantastic from a job-costing financial statement point of view. The combination of job cost and general ledger, and the way they work together, provides everything we need to manage on a lot-by-lot basis as well as our land development," Kallen says.
Crosswinds Communities takes advantage of production management's ability to set up costs based on contracted values. By doing so, the builder has eliminated the need for subcontractors to submit invoices. Instead, Crosswinds Communities generates purchase orders and pays based on them.
"Because we're a production home builder and we're attempting to build a similar home repeatedly, once we've determined what our costs are going to be, there's no reason to go through the redundant task of invoicing," Kallen says. "Once we've issued a purchase order in the system, payment approval is a matter of checking a box on the screen. There's no other data entry that needs to take place."
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