Nobody likes change, especially in construction projects. Since construction projects are so dynamic, it’s impossible to see all challenges that will arise when you first start and changes are inevitable. Construction change orders make it possible to change the scope, budget, and timeline of the work so you get your desired end result. But what exactly is a construction change order and how does it benefit you as the client?
What is a construction change order?
Change order refers to an amendment to an existing contract which changes the scope of work. These orders can affect the deadlines, budget, and types of projects being completed by a contractor.
The most common change orders add on work or extend the deadline, but it is possible to have a change order which decreases the scope of work, especially if it’s more expensive to get the supplies than previously thought.
Good contractors add change order clauses to their contracts because it’s never possible to foresee every challenge and obstacle at the beginning of a construction project. A change order clauses allow contractors the flexibility needed to get the job done right.
Change Order Clauses
Contractors can’t usually change the budget or scope of work without your approval first, so a change order clause includes the procedures for submitting and approving a change order. In reputable contracts, these change order clauses will pull from the standard procedure set by a trade organization (usually AIA or AGC).
Once all parties involved in the contract have agreed to a submitted change order, a new, written agreement is added to the contract. This acts as a formal guideline to what the new work, budget, and deadlines will look like.
Small Change Orders
As you can imagine, there are many different types of change orders. The first, and least impactful, are small change orders. With small change orders, there are usually small shifts in the scope of work, budget, and/or deadline.
Some small change orders could include:
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An increase in price for floor tiles
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Delaying the deadline by a couple weeks because a group is running behind on their project
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Subtracting a small project, such as updating lighting fixtures, to keep a project within budget
Big Change Orders
There are also some larger change orders that can affect the project. Usually, these are more difficult to negotiate and greatly impact a project. Some big change orders could be:
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Increased material prices that will put the actual budget 50% above the estimated budget
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The electrical engineer quoting a higher than expected budget and taking longer to complete the project, adjusting both the deadlines and budget for the entire project
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The client wanting to renovate an area that’s not originally in the contract
With bigger change orders, it can be more difficult to agree. But in these situations, a good contractor has your best interest in mind. Instead of denying these change orders, voice any concerns with your contractor. Your contractor should be able to explain why the changes are necessary and put any worries you have at ease.
Unforeseen Change Orders
There are many reasons why a change order could be issued but the most difficult to navigate are those neither your contractor or you see coming. While unforeseen change orders only account for 1.45% of all change orders, researchers have also found them to be the most disruptive to budget, deadlines, and scope of work.
Unforeseen change orders can include:
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The site conditions don’t pass a safety inspection due to mold and now the mold needs to be taken care of before construction can resume
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Not passing a inspection and having to add on work to get approval
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A subcontractor messed up their part of the project and the contractor now needs to call in someone to replace it
While change orders can cause anxiety and extend the deadlines and budgets for construction projects, they are also necessary to make sure you get your desired result. Instead of fearing change, remind yourself that a change order might happen and if it does, it’s usually in your best interest.
Carlton Building Services in Hampton Roads Virginia
Carlton Building Services specializes in repairs, maintenance, renovations, remodelings and build-outs for a variety of clients in Hampton Roads, Virginia Beach, and Chesapeake areas. We have years of experience handling projects in the retail, office, and healthcare space and would love to work with you on your next project!
To learn more about our services, check out past project highlights or contact Carlton Building Services to see how we can help with your next project.
