The important part to realize here is that when a client wants more work done a formal Change Order will help them understand that more work costs more money! Managing each change through a formal Change Order helps manage expectations and sets out a fair and equitable relationship between you and your client.
Let’s start out by clarifying what a Change Order is. Many contractors and subcontractors start off by offering their services to friends, making verbal contracts, and performing great work while trusting that they’ll be paid. Any modifications to the original project are discussed and verbally agreed without a fuss, and everyone walks away happy. Right. How often does it ever go that smoothly?
A change order is a document used to record an amendment to your original landscape construction contract. Change orders create a record of additional services being provided to your customer, along with pricing for those services. A subcontractor that neglects to use change orders may forget to bill additional costs related to the changes requested, or forget to complete the changes altogether.
A change order form has the following features:
- A revised scope of work – this could mean less work or more, but usually, the customer is asking for something in addition to what has already been agreed.
- Pricing for the new work.
- Any relevant modifications to the original contract that result from the new scope of work, for example, extending the delivery schedule for the project because the scope of work is now greater.
- The signatures of both the contractor and the customer.
The most important function of change orders is that they show the customer that getting more work done costs more money. Change orders were made to help you manage the customer that always wants more for less, and when combined with a detailed scope of work, you’ll have an easy time ensuring that both and your client are treated fairly.
Overall, just make it part of your standard operating procedures that anytime a client requests a change the request is communicated to the appropriate responsible person to create a change order and have the client sign off on the requested change. Make sure everyone on the team buys in to that. Sure it’s going to add more admin work to your already heavy workload, but it will save an incredible amount of headaches in the long run. Additionally, your client will respect your level of professionalism and appreciate your careful attention to detail on their project.
About Change Orders in Manage360
Change orders can be added to a job at any time, on the fly and on site. Once approved, it’s simply added to the current job in Manage360, which gives you different views of the job so you can see the original contract, the change orders, and a current view showing both.
With Job Management, each change order is tracked and billed separately, which not only ensures that you’ re paid for all additional work, but also lets you see exactly how you’re recovering your overhead for each change, and how all of the changes are affecting the job’s overall profitability.
With output to the client that’s based on the American Institute of Architects’ standard change order form, Job Management’s change order capacity is a simple solution to one of the industry’s most complex problems, namely, how to ensure that all of a job’s change orders are recorded, tracked and compensated for in a way that’s easy to do and consistent with your overhead recovery method.