Using the Right ERP Software to Track Profitability for Construction Companies

HOST: Welcome to Digital Journeys, the podcast from Cherry Bekaert that explores how technology is transforming business optimization.

HOST: Each episode we unpack the latest trends, strategies, and innovations that are driving efficiency and growth in today's fast-paced digital landscape. Join us as we navigate the path to smarter, more agile business practices.

JERRY HERIDAN: Hi everyone. My name is Jerry Heridan and I'm a product manager here at Cherry Bekaert. Today I have with me KENTREL LEE, who is our Sage 300 CRE practice manager. Welcome, Kentra. Glad to have you on the program today.

KENTREL LEE: Jerry, thank you for the opportunity to sit down and talk about Sage 300 CRE.

JERRY HERIDAN: Good to have you here. Tell me about yourself and what you do for Cherry Bekaert.

KENTREL LEE: As you said, I am the construction practice lead here at Cherry Bekaert, coming from the Sage construction space. I've been in the Sage construction arena for roughly 11 to 12 years. I started as a help desk consultant for Sage 300 CRE and learned a lot from handling urgent client issues.

KENTREL LEE: I became certified in Sage 300 CRE and moved into consulting and implementations. After working with Sage 300 for about two years, I became certified in Sage 100 Contractor and started working between Sage 300 CRE and Sage 100 Contractor implementations.

KENTREL LEE: I worked for another VAR, a value-added reseller of Sage in the Midwest, where the owner encouraged me to do sales. I moved into sales while continuing consulting, and I did that for about five to six years.

KENTREL LEE: I also spent time in product management, designing products and integrations between Sage and other applications such as ServiceTrade, Spectrum, Viewpoint, Foundation, CMiC, and ComputerEase. I am very familiar with the construction software industry.

JERRY HERIDAN: You mentioned help desk. That requires a lot of patience. Tell me about that experience.

KENTREL LEE: As a new consultant, the clients were often more patient with me than I was with myself. I relied heavily on mentors and reached out to Sage and my mentors frequently. I would go find answers and learn quickly. My degree is in finance and accounting, so I learned construction job cost accounting on the job.

KENTREL LEE: I almost failed my cost accounting class in school, and now I work in cost management. Sage simplifies that process.

JERRY HERIDAN: What do you enjoy most about your job?

KENTREL LEE: I enjoy the diversity. Nothing is the same every day. There are always new challenges and ideas coming through. Throughout my career I've worked help desk, consulting, client relations, sales, and product management, so I understand many parts of the process.

KENTREL LEE: In my current role I do all those pieces together. I can talk sales, speak the consultants' language, and avoid overpromising during demos. I focus on accurately representing what the system can and cannot do.

KENTREL LEE: I also enjoy account management, discussing add-on solutions in the Sage ecosystem such as Sage Field Operations for job scheduling and time capture, Sage Paperless with AP automation, credit card reconciliation, OCR, Office Connector reporting, and Liberty Reports for Sage 100 Contractor. I jokingly call myself a professional cat herder.

JERRY HERIDAN: You used to be a teacher. How has that helped you in your current role?

KENTREL LEE: Before entering the Sage space, I taught high school math—algebra, geometry, algebra II, personal finance, and some trigonometry—in the inner city. Teaching math concepts was foundational for me.

KENTREL LEE: I love teaching and watching students get the light bulb. Sharing knowledge helps clients make educated decisions. Often people don't know what they don't know, so education is essential.

JERRY HERIDAN: Let's discuss the two main products you focus on: Sage 100 Contractor and Sage 300 CRE. First, what is Sage 100 Contractor?

KENTREL LEE: Sage 100 Contractor, formerly Master Builder, is a first-generation construction accounting system that has evolved since the late 1970s and early 1980s. It's a mature, cohesive, and scalable product.

KENTREL LEE: Contractors using Sage 100 Contractor range from $500,000 to half a billion dollars in revenue. The system supports scheduled reports, equipment tracking, lightweight scheduling with Gantt charts, subcontract call sheets, budget tracking, cost tracking, and remaining balance visibility. It's a strong solution in the construction ecosystem.

JERRY HERIDAN: Is Sage 100 Contractor specifically for contractors and are there industries where it's more beneficial?

KENTREL LEE: Sage 100 Contractor is designed for construction. Construction accounting is centered on work in progress, tracking project progress and costs, often using the industry standard cost code list—what we call the 16 CIS codes or standard cost codes. The system is built to track cost against a project.

JERRY HERIDAN: Now let's move on to Sage 300 CRE. What is that?

KENTREL LEE: Sage 300 CRE, historically known as Timberline, is the largest and most popular construction system in the market. It is a proven product with over 1,500 reports.

KENTREL LEE: Sage 300 CRE supports complex organizations that have multiple divisions—development, construction, equipment, property management, and service—within the same company. It allows departmentalized balance sheets and intercompany accounting in a single data folder.

KENTREL LEE: Sage 300 CRE offers powerful job costing with complex reports and flexible billing methods at the contract line item, such as time and material, progress billing, and cost-plus maximum. It supports reciprocal agreements and multi-state operations.

JERRY HERIDAN: What are common challenges you hear from companies that need help?

KENTREL LEE: A major struggle is tracking true project profitability when not using a job cost accounting solution. Clients often don't track committed costs—purchase orders and subcontracts—on the front end.

KENTREL LEE: Without committed cost tracking, owners make decisions based on inflated early profitability, then see profits drop as invoices and pay applications arrive. One bad project can threaten a company if costs and labor are not tracked correctly.

JERRY HERIDAN: So they're making business decisions based on poor data.

KENTREL LEE: Correct. I recently read that between 2001 and 2023, 83% of contractors went out of business, and 56% failed within the first three years. Poor project tracking and data contribute to that. Sage 100 Contractor or Sage 300 CRE helps provide the data needed to make better decisions.

KENTREL LEE: These systems add guardrails around projects to keep them within scope and budget. Labor is often the biggest driver of scope creep. If labor doubles and the project is only 50% complete, the project will suffer. Proper tracking prevents that.

JERRY HERIDAN: How do you help clients choose the right software?

KENTREL LEE: First, listen to their business profile. I enjoy learning about a contractor's bread and butter and their workflows. If a company has multiple divisions and needs departmentalized balance sheets, I lean toward Sage 300 CRE.

KENTREL LEE: Certified payroll and prevailing wage are critical for government and bonded projects. Certified payroll reporting, LCPtracker in California, prevailing wage compliance, bonding reports, buyout reports, and work comp audits are specialized needs that QuickBooks and similar systems can't handle. Sage construction products provide those capabilities.

JERRY HERIDAN: For a very small contractor just starting out, is Sage 100 Contractor or Sage 300 CRE too robust?

KENTREL LEE: It depends. Many contractors start in QuickBooks and migrate as projects grow more complex. Sage products have a growth trajectory. Starting with Sage 100 Contractor doesn't mean you must stay there; you can move to Sage 300 CRE as your business adds divisions and complexity.

KENTREL LEE: Sage supports contractors from small firms to large organizations, and about one in five contractors uses a Sage product.

JERRY HERIDAN: Can you walk through an example of a client success story without naming the client?

KENTREL LEE: Many small owners wear multiple hats—owner, project manager, estimator, foreman. Sage 100 Contractor helps them manage operations more efficiently as they grow. Implementing a job cost accounting system is a foundational investment; it becomes the infrastructure that enables profitability and scalability.

JERRY HERIDAN: Is there anything you'd like to add in closing?

KENTREL LEE: Switching to Sage requires more than software; it requires implementing software, processes, and people. Sometimes a company is not ready for that change. For those ready to improve processes, Sage can be the right solution.

KENTREL LEE: I have walked away from deals where the company was not ready. Not being a client today doesn't mean you won't be a client tomorrow. We need to ensure the company is ready for software, process, and people changes.

JERRY HERIDAN: Implementation sounds like a deep topic. We'll do another podcast focused on implementation and the process.

KENTREL LEE: Yes, that will be a great conversation.

JERRY HERIDAN: To all the listeners, you heard Kentra. He will do another podcast on implementation and the entire process. Stay tuned for that.