"An excellent book for contractors to help them master variation claims and change orders." As discussed in my earlier post ‘Are you working for free on your construction project’ (Read more) most construction projects have changes and variations which contractors have to undertake. Contractors need to claim for the additional costs associated with this extra work. The variation work usually has to be priced before the work is carried out. Unfortunately some contractors don’t price these correctly which means that they could be out of pocket. Other contractors try and be too clever, focusing on how they can make their variation claim as large as possible, even inventing costs. Yet, these same contractors forget to recover some of the actual costs they are entitled to claim. In my post ‘Understanding the real cost of delays to your project’ (Read more) I discussed some of the costs that delays cause to construction projects. Below are potential costs that should be considered when formulating other construction variations. Costs to include in construction variation claimsCosts to include in your variation claim or change order include: 1. Construction labour costs including:
2. construction material costs including:
3. construction equipment including:
4. demolishing existing structures including:
5. supervision and management costs including:
6. off-site staff such as Contract Administrators, and Planners 7. project insurances and sureties 8. costs of permits 9. profits and overheads 10. access equipment 11. office and facility hire 12. additional project site security 13. protection of existing and completed structures 14. additional design and drawing costs 15. subcontractors’ costs including the contractor’s mark-up Construction changes can have knock on effects and costsIt’s also important to assess the effect the variation or construction change has on the construction schedule which may result in: 1. the overall construction project duration being extended (Can I Claim for Additional Time on My Construction Project?) 2. the variation impeding or delaying other construction works 3. the variation requiring resources from other construction tasks which then impacts on their completion dates and the overall construction schedule 4. in some cases the overall project may be delayed and push the work into an unfavourable weather season such as winter or heavy rainy periods Honestly claim costs due for the changes without being stupidAlthough it’s important to ensure that all costs are captured it’s also petty to be claiming for a kilogram of nails on a one thousand dollar variations, or to be adding in every cent, which can also be time consuming. so try and look at the bigger picture. Some of the costs may also already be covered elsewhere in the contract. Remember too that the client will often request a breakdown of how you calculated the cost of the variation so ensure that you are able to justify all of the costs. Good record keeping is an essential aid to proving your costs. Sometimes clients may insist the variation claim is priced according to existing rates or other similar work. You may then have to ensure that these existing rates will cover all of your costs. If they don’t you may be able to justify to the client reasons why the existing rates shouldn’t apply. 15 Rules for construction variation claims and change orders Get your construction change order and variation claim paidYou usually have one opportunity to include all the costs in your construction variation claim or change order and it’s difficult, unprofessional and embarrassing to ask the client for more money after your variation has already been accepted by them. So get it right first time. 10 Tips To Submit Winning Variation Claims (Adapted from the book; ’Building a Successful Construction Company: The Practical Guide’ by Paul Netscher. Paul has also written the popular book ‘Successful Construction Project Management: The Practical Guide’. Both books are available from Amazon and other retail outlets) Learn how to become a successful construction project manager.Paul Netscher has written several easy-to-read books for owners, contractors, construction managers, construction supervisors and foremen. They cover all aspects of construction management and are filled with tips and insights. Visit to read more. The books are available in paper and ebook from most online stores including Amazon. Note: We welcome genuine comments, especially comments that add additional information to the subject matter in the article. We however reserve the right to remove inappropriate comments, which includes comments that have nothing to do with the subject, comments that include inappropriate language, and comments that are an advertisement for a product or company, or which include an advertising link. We will not enter into discussion on why a particular comment was removed.
construction management construction project management
2 Comments
Leonard Alufurai
3/5/2015 09:23:19 am
I need templates in contract management. Can assist me on this.
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Paul Netscher
6/5/2015 02:26:46 am
Hello Leonard, unfortunately I don't have templates for construction management. It is something I'm considering for one of my next books. Thanks for the comment.
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Note: We welcome genuine comments, especially comments that add additional information to the subject matter in the article. We however reserve the right to remove inappropriate comments, which includes comments that have nothing to do with the subject, comments that include inappropriate language, and comments that are an advertisement for a product or company, or which include an advertising link. Comments must be in English. We will not enter into discussion on why a particular comment was removed.
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The opinions expressed in the attached articles are those of the writer. It should be noted that projects are varied and different laws and restrictions apply which depend on the location of the contractor and the project. It's important that the reader uses the supplied information taking cognisance of their particular circumstances. The writer assumes no responsibility or liability for any loss of any kind arising from the reader using the information or advice contained herein. "I have what I consider some of the best books on construction management."
Books are available from: Amazon.com Amazon.co.uk takealot.com kalahari.com Amazon.in Amazon.de Amazon.fr Amazon.it Amazon.com.au Powell's Fishpond uread bokus Amazon.ca Amazon.es Other retail stores Available in paperback or on Kindle "28 YEARS OF CONSTRUCTION PROJECT MANAGEMENT EXPERIENCE, DEVELOPING SUCCESSFUL CONSTRUCTION PROJECT MANAGERS AND BUILDING SUCCESSFUL CONSTRUCTION COMPANIES"
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