Job costing is meant to keep very close track of expenses. So, in a nutshell, companies with highly variable costs would want to use this accounting method.
Here are some companies that might use job costing:
The idea behind job cost accounting is to keep the accounting for each job separate. This is highly applicable to construction companies because their jobs are so cost heavy. If you need to buy 100ft of copper pipe for a plumbing job, that shouldn't count against your budget for a quick drywall job. They may make a huge profit on one job and lose money on the another job. When it's all lumped together, it won't be clear what's really going on with the business. With job costing, you can clearly see what's profitable and what isn't.
Construction companies have a fantastic tool available to them. That tool is cost codes. Cost codes are 5 or 6 digit numbers that designate what type of work was done. This makes it easy to pull up a report to see how much is being spent on the company's various activities. They can see great detail and make highly informed decisions from that data.
An advertising agency could be compared to a construction company. They have a similar setup, but with far less materials. Each client would have their own needs, whether that's online advertising, web design, or even billboards. Those services would all have costs attached to them, though they aren't nearly as numerous as in construction.
Job cost accounting is centered around jobs, hence the name. Any company that is going to have a list of jobs to manage would likely benefit from this. Manufacturing is a similar situation, because each product they produce will have costs that need to be tracked separately from one another. This helps them determine the break-even point, which helps the company decide how much to charge for each individual product.
It's the customization aspect of business that makes job costing so important. When you sell the same line of products at the same prices each day, it's fairly easy to track. Contractors, on the other hand, are hired on for a temporary job. That job will differ greatly from the last, and its accounting will need to be kept separate from other jobs. This is how profitability is tracked, and how the company keeps a budget.
We don't usually think of catering companies as contractors, but their business model is similar to construction companies. They are hired on temporarily to bring in their supplies and provide a service. The costs will vary greatly from one gig to the next. Also, the costs could easily get out of hand if not tracked carefully.
Production companies can also benefit from cost accounting. They have a lot of equipment that needs to be tracked, and a lot of specialists with varying pay rates. A quote for filming a short commercial will be a totally different ball game when compared to filming a documentary. During a project there will be a huge potential for change orders. A project owner might rethink how they want to do a commercial, or maybe the filming needs to be relocated. In that situation, staff members and equipment will all need to be moved. This not only adds time to the budget, but it adds travel costs and equipment hauling expenses. If a production company has a good accounting system, they can make the necessary changes to the budget and adjust the invoice to the company that contracted with them. If they aren't keeping track of it, those changes could easily eat up all the profit from the job.
Web design is another company that really needs a good system of accounting. No two websites are alike. They require different technology, which requires different programmers and pay rates. Each job is unique, and business owners will ALWAYS request changes. Once a website is completed according to the company's request, the owners will have a chance to review the site and ask for changes. Some of those changes can be covered by the original quote, and some of those changes will need to be added to the invoice. By making a clear price quote with services specifically listed, the web designer will be protected from cost overruns. They will be able to track those expenses along the way, and not let the company get away with adding things that were not discussed. A great accounting software or project management software will be instrumental in this.