Take precautions and prepare correctly to make sure a project stays on-time and on-budget
While every client hopes that their build goes exactly as planned, many construction projects undergo some type of change order during the process. Often, the changes are minor and don’t seriously affect the schedule, but sometimes, major changes are required due to unforeseen circumstances.
If a client and a firm aren’t careful throughout all stages of the planning and construction process, a change order could result in big expenses, lengthy delays, and errors that could have a huge impact on the project.
Review construction contracts before a project begins
Before beginning any project, it’s essential to make sure the construction contract clearly defines how the construction company, design firm, and any other contractors or parties process a change order. It’s important to ensure that the contract requires construction companies and other contractors to inform clients as quickly as possible about any potential changes that are needed, as well as to provide budget estimates, drafts, plans, and other important documentation so that all relevant parties are up to speed on the alterations.
Without proper documentation and planning, it’s much more difficult for clients, engineers, architects, and others to work together to develop a timely and cost-effective solution to any issue that might require a change order.
Types of change orders in the construction industry
Typically, there are two different types of change orders commonly issued during construction projects: a fixed sum change order and a time and materials change order. There is also a third variety that can begin as a time and materials order, but later is negotiated into a unit price.
A fixed sum, or lump sum change order covers any additional work to be added or removed from the project, usually itemized by the costs of labor, material, and equipment. A time and materials change order looks at the time and materials required, and allows the construction company to keep a running tab of expenses. This can potentially save a client money, but it could also lead to unexpected expenses if a change is more expensive or time consuming than initially thought.
Clients may want to estimate costs to make sure they’re not being overcharged
If a contractor is proposing a major or very costly change to a construction project, it may be a good idea to consult with an external company to have an estimator examine the change order. Alternatively, if a company has employees skilled and trained at estimating, they may simply want to order an in-house estimation.
Even if a construction firm isn’t intentionally overcharging a client, there may be a more efficient way to finish or alter the client’s project than first realized. Whether a client accepts the initial change order or waits to have an estimator check it, it’s important to confirm the final price for a change as quickly as possible. Without knowing the full price of a change order, it’s impossible to effectively budget and forecast the final cost of a project, manage contingency funds, and engage in any meaningful dialogue with a construction firm.
Planning and staying informed are essential to effectively managing change orders
Just as in any step of the planning and construction process, staying informed about your options is essential. Unless a client has a good construction contract, a smart budget, and a plan to estimate any change orders that come their way, they could get taken by surprise when the cost of a seemingly-minor change to their project incurs a big expense or delay.
At Telesco Construction, we make sure our clients are informed about potential changes at every stage of their project to maximize efficiency and ensure a great client experience. Because we are a design-build firm, all of the individuals working on your project are in-house, enabling greater communication and cooperation. This collaboration smooths the process of change orders – we have the personnel to look at a revision from all angles and propose a solution that keeps your project on track and within budget.
To learn how our integrated design-build firm can help build your building safely, quickly, and effectively, get in touch with us at 305.390.0250 or through our online contact form.