Two contractors run the same QuickBooks Online plan. One can tell you within thirty seconds whether the kitchen remodel made money. The other spends twenty minutes building a report and matching names by hand. The difference isn’t usually the bookkeeper. It’s whether the business is set up with sub-customers or Projects, and most contractors never chose one on purpose. They ended up with whatever QuickBooks defaulted to, without ever picking a side.

Sub-customers and Projects both let you track a job separately from the customer who hired you. That’s where the similarity ends.

How Sub-Customers Work

A sub-customer nests one job under a parent customer’s name. “Johnson Kitchen Remodel” sits under “Mark Johnson” the same way a subfolder sits inside a folder. Every invoice, bill, and expense tagged to that sub-customer rolls up into your reports, but QuickBooks doesn’t hand you a summary. You build one yourself, usually by running a Profit and Loss by Customer report and scrolling until you find the job you’re looking for.

Sub-customers come standard on every QuickBooks Online plan, including Simple Start and Essentials. If your subscription doesn’t include Projects, sub-customers are your only option for job-level tracking, and they work fine as long as you’re willing to do the reporting by hand.

How Projects Work

Projects, available on QuickBooks Online Plus and Advanced, group every transaction tied to a job under one roof and build the profitability picture for you. Open a project and you see income, costs, and margin without assembling anything yourself. Under the hood, a project behaves a lot like a sub-customer. The difference is the dashboard sitting on top of it.

If you’re already using sub-customers on Plus or Advanced, you don’t have to start over. QuickBooks converts a sub-customer into a project directly from the Projects tab, and the transaction history comes with it.

Which One Actually Fits

The plan you’re on decides more of this than most contractors realize. Simple Start and Essentials don’t include Projects at all, so sub-customers is the only path, and the real decision is whether to keep building reports by hand or move up to a plan that builds them for you.

On Plus or Advanced, the calculus changes. A contractor juggling two or three jobs at a time might get by fine with sub-customers and a monthly report-building habit. A contractor running six or eight jobs, bidding new ones every month, and trying to catch a losing job before it drags down a good quarter benefits from a profitability view that’s already sitting there, not one reconstructed by hand each time.

Neither setup fixes bad tagging. A sub-customer or a project only pulls in what gets tagged to it. Buy materials for the deck and code them to the wrong job, and the report on either system tells a story that isn’t true. The setup decides how much manual report-building falls on you. It doesn’t replace the discipline of tagging every bill, invoice, and hour to the right job the first time.

Making the Switch

If you’re on Simple Start or Essentials and the manual reporting is eating time you don’t have, upgrading to Plus unlocks Projects and converts your existing sub-customers without losing history. If you’re already on Plus or Advanced and still building job profit reports by hand, converting to Projects is usually a short afternoon of setup, not a rebuild.

Getting more out of the Profit and Loss by Job report starts with the setup underneath it. Whichever version QuickBooks calls it, sub-customer or project, the report is only as good as the structure feeding it.

Sullivan Bookkeeping Services sets up job costing correctly the first time, on whichever QuickBooks plan you’re running, so the reports show the truth about each job instead of a guess. Book a free 15-minute consultation to find out which setup actually fits your business.