Day: July 17, 2025

Navigating 2025 Tariff Policies: Impacts on the Construction Industry

As of mid-2025, U.S. tariff policies are undergoing significant changes that are reshaping the construction landscape. For contractors, understanding these shifts is important to managing costs, maintaining project timelines, and staying competitive in a volatile market.

Current Tariff Landscape

The U.S. has implemented a series of aggressive tariff increases under the current administration. Key developments include:

• Tariffs on all steel and aluminum imports, affecting structural materials and fabrication costs. The tariffs imposed in April 2025 were increased effective June 3, 2025, from 25% to 50%.
• 25% tariffs on imports from Mexico and Canada, with limited exemptions under the United States-Mexico-Canada Agreement (USMCA).
• Proposed 25% tariffs on copper and lumber, which are still pending but could significantly affect electrical and framing costs.
• 10% tariffs on potash and energy products, indirectly influencing construction through increased fertilizer and fuel prices.

Impacts on Construction Contractors

Rising Material Costs
Tariffs on steel, aluminum, and lumber have raised prices across the industry. These cost increases may result in diminished profit margins, making it harder to stay within budget.

Supply Chain Disruption
Tariffs have disrupted long-standing supply chains. Contractors may face delays in material deliveries resulting in the need to seek alternative sources.

Project Delays and Budget Overruns
With materials harder to source and more expensive, project timelines are likely to stretch. Contractors should build in contingencies for procurement and pricing volatility, as these factors can complicate client negotiations and contract agreement.

Strategic Shifts in Procurement
Many firms are turning to domestic suppliers. While this can reduce exposure to tariffs, it may also introduce new challenges in terms of capacity, quality, and pricing.

What Contractors Can Do

While some tariffs may be temporary or subject to negotiation, the current trend suggests a protectionist trade environment for the near future. Contractors who adapt quickly and build flexibility into their operations will find themselves better positioned.

A way to facilitate this is with a mid-year financial review, which allows management to assess project profitability, cash flow, and budget performance across ongoing jobs as well as the organization. These factors are often impacted by fluctuating material costs and labor availability. With the added complexity of tariffs on imported construction materials such as steel, aluminum, and lumber, contractors face increased cost volatility. A thorough mid-year check-in helps identify where tariffs may be inflating expenses, enabling contractors to adjust estimates, renegotiate supplier terms, or explore alternative sourcing. This proactive approach ensures better financial control, supports accurate forecasting, and strengthens the contractor’s ability to navigate a dynamic and often unpredictable market.

CSB can provide assistance in this area. Please reach out to your CSB contact to discuss questions or concerns.

The tariffs referenced above reflect tariff policy as of July 15, 2025. Tariffs on these goods may vary due to future changes in tariff policy or based on the specific policies regarding the countries from which the goods are imported.

The Benefits of Fractional CFO Accounting Services for Construction Contractors

Running jobs, managing crews, juggling bids, and trying to stay afloat — and then someone asks for a five-year financial projection.
That’s where a fractional CFO steps in. No suits, no fluff — just solid financial expertise, tailored to your business. Whether you are looking to grow, streamline operations, or simply gain a clearer picture of your finances, this might be the smartest move you haven’t made yet.

What is a Fractional CFO?

A fractional CFO is a part-time financial expert who provides strategic guidance — without the full-time price tag. You get the same knowledge and leadership as a traditional CFO, but on a flexible, as-needed basis. For construction businesses trying to grow, stay lean, or just clean up the financial side of things, this model can be a game changer.

Key Benefits for Construction Contractors

1. Cost-Effective Expertise: Fractional CFOs bring seasoned financial leadership at a fraction of the cost of a full-time CFO. This is especially valuable for small to mid-sized construction firms that need expert advice but cannot justify a full-time executive.
2. Cash Flow Management: Effective cash flow management is vital in construction, where project timelines and payment schedules can be unpredictable. Fractional CFOs can assist with optimizing cash flow, preventing financial bottlenecks and enabling smooth day-to-day operations.
3.  Job Costing and Project Accounting: Accurate job costing and project accounting are essential for profitability. Fractional CFOs oversee these processes, ensuring that projects stay on budget and identifying potential issues early.
4. Strategic Planning: Fractional CFOs provide strategic insights that inform key decisions, such as hiring, marketing spend, and contract negotiations. Their experience across various industries offers unique perspectives that can fuel growth and efficiency.
5. Financial Reporting and Analysis: Routine financial reporting and analysis are crucial for understanding the health of a construction business. Fractional CFOs deliver actionable insights that support informed decisions and long-term planning.
6. Access to Capital: Need financing for a large project or expansion? Fractional CFOs help craft accurate financial projections and present them to lenders or investors, improving your chances of securing funding.
7. Compliance and Risk Management: Navigating complex regulatory environments is part of the construction business. Fractional CFOs help ensure compliance with financial regulations and manage risks related to insurance, bonding, and other financial matters.

Fractional CFO services offer construction contractors a flexible, cost-effective solution to their financial management needs. By providing high-level expertise on a part-time basis, these professionals help firms navigate financial complexities, optimize operations, and drive strategic growth. Whether you’re scaling rapidly or tackling complex projects, a fractional CFO can be a powerful ally in achieving financial stability and long-term success.
Below are a few examples of fractional CFO services that Crow Shields Bailey can provide:

• Bookkeeping cleanup and accounting software customization
• Assistance with preparing contract schedule
• Budgeting and forecasting
• Working capital and cash flow analysis
• Evaluating whether to purchase or lease equipment
• Goal setting and key performance indicators

If you’re interested in learning more about how fractional CFO services can benefit your construction business, please don’t hesitate to contact us. We’re here to help you achieve your financial goals and drive your business forward.