IMPORTANT: All new projects created after 12/15/22 are using BuildBook's new Financials. This article refers to the classic Budget. To learn about how to use the enhanced Financials, please go to this article.
In this article
Budget management in BuildBook allows you to always keep your clients up to date on the status of the budget. As you start adding Budget Items, everything rolls up into your Budget Summary and shows both the original planned budget and the projected budget (taking into account change orders, selections, etc).
The Budget Summary is organized by Plan vs. Projected Costs across all Budget Items (Base Costs, Selection Categories, Change Orders, Credits, Payments). Think of your planned costs as your approved estimate, or the final amount approved in your contract. Projected Costs reflect any unplanned changes in the Planned Costs, most likely via a Change Order.
Base Costs: This is the sum total of all the Base Costs entered.
Selection Categories: This is the sum total of all Selection Category allowances, i.e. how much you’ve planned to spend on selections.
Change Orders: This is always zero in the planned costs. If an amount is planned in advance, that total would go into a Selection Category or Base Cost.
Credits: This is always zero since Credits are not typically a planned cost.
Project Total: Sum total of all the above Plan values. This is your planned total budget.
Payments Made: Reflected in Projected Column
Outstanding Balance: Reflected in Projected Column
Base Costs: This is the sum total of all the Base Costs entered. This amount is automatically populated from the Estimate amount in each Base Cost. If you’ve entered a number into the “Projected Cost” field on a Base Cost, that number is used in place of the “Estimated Cost” amount.
Selection Categories: This is the sum total of all Selection Category allowances. However, if the individual Selection Item amounts exceed the allowances (i.e. if you’ve gone over your allowances), then this column increases to show the sum total of all selections.
Pro tip: If the individual Selection Item amount in a Selection Category is lower than the allowance AND all items in that Category are marked as Complete, the Projected column updates to reflect that value. i.e. Once all items in a Selection Category have been selected, the final values are used.
Change Orders: This shows the sum total of all Change Orders that have an "Approved" status.
Credits: This shows the sum total of all Credits.
Project total: Sum total of Base Costs, Selection Categories, and Change Orders, minus Credits.
Payments Made: Sum total of all Payments marked as "Paid"
Outstanding Balance: Project Total minus Payments Made.
You can quickly tell which items are marked as Complete/Paid/Approved vs. still in a Draft/Unpaid/Incomplete based on the font color and style:
Selection Category amounts are in gray italic until all selections in all categories are marked as Complete.
Projected Amounts in Base Costs are considered "pending" when in "Open" Status and are shown in gray italics.
Items that are considered "final" ie Approved/Complete/Paid, the amount is shown in black, regular font.
Add Budget Items
Select "+ Add Budget Item" in the Budget tab to start building your budget. From the dropdown you have five Items to choose from that will all roll up to your Budget Summary.
1. Base Costs
Base Costs are the fixed costs associated with the job and are fully customizable so you can set them up in a way that works best for you or how you prefer to structure your client-facing budget.
Here are a few ways you might use these costs in your business:
Costs pulled straight out of your signed estimated or construction agreement.
For a fixed-fee job with a single base cost.
If you are an open-book company with multiple base costs to help the client understand how their budget is being spent across construction categories and trades.
2. Selection Categories
Track both the original allowance as well as the actual amounts once selections have been made. Your Selection costs will be managed per Item in your Selections tab. If you haven't already, take a look at Setting Up Your Client Selections.
Like base costs, you can customize your selection categories however you'd like to make sure things are clear for your client and to keep you and your team organized.
3. Change Orders
As we all know, it wouldn't be construction if things went exactly according to plan! Change orders can be created as "draft" and then marked as "approved" once the client agrees. Note: only approved change orders have an impact on the budget.
Track any discounts, write-offs, or other items that you need to reverse out of your budget.
Log any payments that the client has made or will be making.
This allows the client to always see an accurate view of their projected outstanding balance in the budget summary. You can set up a full payment schedule upfront, or you can add payment items as the project progresses. Note: only payments marked as "paid" have an impact on the budget.