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Change Orders are often the most misunderstood part of a project. They essentially create a fork in the road on a long-distance trip. As an example, imagine your airplane needs to navigate around weather. There is no way you are going to get to your destination on time, if you stray from the shortest / most efficient route. We will also likely need to get more fuel to get to our destination by taking the long way.
At a recent remodeling conference, I reaffirmed that every contractor struggles with Change Orders. To have my clients be the best informed, I have carved out this spot to lay down the “How we do it here” for Change Orders. If I could count my Change Orders for the year on one hand, I would be happy.
How We Avoid Change Orders
- Having a clear DOW
- Having all Finish Materials Selected and shop drawings for areas of detail prior to contract
- Having great plans
Why Is a Change Order Disruptive?
Change Orders are disruptive to the schedule by nature; they always take time to discuss, calculate, and implement. Without tight scheduling practices, a ripple effect occurs delaying your project completion date. This naturally affects the next project, which was scheduled to begin upon the completion of yours. This little delay in your project could ultimately limit our ability to work to our potential or grow.
Q: Why are they punishing me with a Change Order?
A: It is not punishment. I look at them like we are documenting our path through the project as we go, to determine how we got to the conclusion of the project. This is the most transparent method of documentation that we have.
What Is It Going to Cost
Some Change Orders are more difficult to calculate than others. In a perfect world, we would do the work, then send the bill. In our experience, that often creates a “cart before the horse” situation. As dentists have discovered, once the pain is gone, there is little incentive to pay the bill. We will always, (barring an emergency situation) provide the cost for the change prior to doing any work on the change.
Change Order Types at Levco
Non- Discretionary: When an inspector tells us we have to do something we did not plan for, or upon opening up a ceiling we find all sorts of electrical junction boxes from a previous DIY remodeling project that need to be dealt with. There are plenty of examples of this in the vintage homes we work on, as our x-ray vision is less than perfect (especially for homes that were built prior to building codes). These typically happen earlier in the project.
Discretionary: An optional thing that can be an idea that comes from anyone, usually related to opportunities that pop up during construction or “Now that we can see the space, a larger format tile will look better.” These typically happen later in the project.
Not All Change Orders Cost Money
We like to document changes. These are things that are important to us and can chart the progress of a project. It is not uncommon to change a thing that does not affect the cost, like a change of paint color before the paint is purchased or to change the swing of a door before it gets ordered. The documentation of these changes is critical to good communication,. so be prepared to use the process we set up to make our projects work.
How to Start the Process
What you can expect, once you raise the possibility of a Change Order to your Project Manager is, “I’m sure it can be done, but that will cost more and may extend the completion date of the project. Sounds like we need to discuss a Change Order.”
What We Strive For
- We promise a 24-hour or less turnaround on processing your Change Order requests.
- You will be invoiced for “payment due” at the same time you approve the change.
- Time to complete the project will likely be altered.
- There will be a cost associated with the work to create a Change Order.
- Executing your Change Order will be a timed event, In other words, we will try not throw out the schedule, but expect it to be altered.
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If you or someone you know is considering remodeling or just wants to speak to a trustworthy remodeling contractor, please contact me. You’ll be glad you did.