For drywall contractors, material costs can make or break job profitability. The difference between a profitable job and a break-even one often hides in whether materials were tracked properly and waste was accounted for.

Start by separating drywall purchases from other expenses. Use a dedicated credit card or at minimum a dedicated account for materials. When you buy drywall sheets, mud, tape, screws, and corner bead, those purchases need to link to the specific job they’re for.

The easiest field method is noting the job name on the receipt immediately. Take a photo with your phone before you leave the parking lot. Apps like Dext or Hubdoc can automatically pull receipt data into QuickBooks, but even a simple photos folder organized by job works if you’re consistent.

In your accounting software, set up construction job costing so every material purchase connects to a specific project. Don’t just categorize it as “materials expense.” Assign it to “Materials - Johnson residence” or whatever naming convention you use. This level of detail lets you compare estimated costs to actual costs after the job wraps up.

For drywall specifically, consider tracking board, finishing materials like mud and tape, fasteners, and texture materials as separate categories. This breakdown shows where your estimates are off. Maybe you price board accurately but consistently underestimate finishing materials. You won’t know unless you track them separately.

Buy materials job by job when possible rather than stocking up. Bulk purchasing can save money but creates tracking problems because you have to allocate inventory across multiple jobs. If you do stock materials, track them through an inventory account and pull from inventory when materials go to a job.

Reconcile weekly, not monthly. Check that every material purchase made it into your books and is coded to the right job. Waiting until month end means you’ve forgotten which job that $340 Home Depot run was for. A bookkeeper in American Fork familiar with construction accounting can set this up so it takes minutes instead of hours.

The contractors who know their true job costs track every sheet of drywall, every bucket of mud, and every box of screws. The ones who don’t end up wondering why their profit margins are thinner than they expected.