Ponder This One - Opinions Welcome

Bud Cline

In February of '07 I was approached by a local GC to participate as a consultant in the engineering of a floor structure of a new home due to a large amount of travertine being anticipated. I participated and the actual structural engineers designed accordingly.

The project is just now in the drywall finishing stages. In the meantime I have met with the owner/customer on many occasions discussing finish products and designs. They have also contracted with a professional designer for advice. This job has changed many many times and many meetings and consultations have taken place to date. I haven't been charging for any of my time to discuss the project. I was happy just to have the job and not have to compete for it.

Well this designer has added several tile-fancies and of course I am happy to have the extra work.

I have just furnished the GC with the estimates of the additional work and he isn't happy. He doesn't want any of the costs to escalate. Mind you this house is being built at a cost of $1.4M. Their cost overruns having nothing to do with me have exceeded $80K at this point and of course the homeowner wants to draw a line in the sand but he is the reason for the overruns thus far - no one else.

I get the feeling that this GC expects me to complete the extra work for the original proposed price offered back in '07 just to keep the price own. I can't remember when's the last time a customer asked me to provide a service and I told them: "No, I'm sorry, but I don't want any extra work, you are already spending too much money as it is!!!"

COMMENTS???

Bodger

I guess the obvious question would be are you willing to come down a bit on the figures you quoted for the added extras to preserve the opportunity for profit on the whole job?
I don't think it's altogether a fair reason if the GC wants the changes but doesn't want to pay anything additional just because there have been cost overruns for unrelated extras at the H/O's behest prior to you even starting.

RayGoerdt

Could be a real pickle, the GC should understand that your time is at least as valuable as his, and you need compensation for it.

silvertree

Bud, normal for you to want the extra work, very nice of you to consult for free. As a GC I would not insult you by asking you to do more for the same price. I would not be doing my job properly to get you into this position.
Do what you think is best, but you deserve to be paid more. You shouldn't have to do anything more than invoice for the extras.

You got to know when to hold, know when to fold, know when to walk away and when to run.

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SLSTech

Every consultant I know gets paid. I can understand why you didn't, but if you respect your time, others will also.

Most estimates I know are good for only a limited time (they range from the same day till 30 days out). Explain why the price has changed & tell him if he doesn't want to explain it to the HO, you will be glad seeing you already have a good relationship with the HO (FYI - cost changes should have been discussed in the prior change meetings - so it should not come as a surprise to anyone). I guarntee you the GC has been charging for changes

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Chris Johnson

Only 80k overages on a 1.4m project...that's nothing, what are they wanting?

Show them the original proposal, date and amount, here it is 22 months later, things cost more...especially when the scope gets bigger

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Bud Cline

What I'm willing to do is to stand my ground and wait and see what happens.

After the recent gas-price-run-ups of the summer materials have increased in cost since I quoted the job.....I am eating that increase at this time.

In the basic proposal I must have somehow missed about 300 square feet of tile labor which is now becomming a reality and I am eating that error without hesitation.

So...NO! I'm not willing to come down a bit at this time. Isn't new work what this is all about? If the customer wants to add to the scope who am I to tell them they can't. I shouldn't be expected to "thrown-in" that much work out of the kindness of my heart. We're talking about $3K worth of extras on a house that is costing $1.4M to build.

Bud Cline

Agreed! And I had nothing to do with that. I wasn't involved in any of those proceeds.

Bodger

I find sometimes as the jobs draw closer to completion, I begin to hear questions like "Is there any way we can go on a payment plan?" or "Since it's taken so long, could we get a break on your hourly charges?"

I usually say no, sometimes I'm flexible on the last invoice, but in any case, the $5000 Wolf barbecues and expensive changes to the glazing, and the pricey flatwork seem to keep on coming, and the H/O finds the money somewhere. I try to make sure that "somewhere" isn't my pocket.

wireless

The best way for them to save the money would be not to do the work. Why would you think of sponsoring their extras? Will they give you a plaque for your donation?

Tinstaafl

Bud, hopefully you have a paper trail showing the path from original proposal to what's wanted now. Lay it out in a spreadsheet that both the GC and the client can understand. Then stand back and let them dicker over where the concessions should be.

Bud Cline

That's the problem with doing tile work. When I get on the scene, all the money has been spent and the owners are into overtime with their lender. All the battles have been fought and everyone is pissed at everyone else.

Then along comes the tileguy wondering if there is any money remaining to pay him. When they dig the hole money is no object, when it's time for the floor covering someone is always looking for a discount from the flooring guys.

Bud Cline

I hand-delivered the spreadsheet last Friday.

MattCoops

Someone said something about increase in cost in part due to gas prices.
Unleaded started at $1.93 here today. It was almost double that in the summer. So actually, gas has gone WAY down, especially in the last few weeks.

A better initial step in consultation process would have been to have the GC give budgets to different facets of the finishes projects.
And if you did have a budget set, what percent of that budget was towards materials? and what percent were you left over for labor profit?

And Bud, you were saying something about missing 300 sq ft of tile labor in your initial bid. Well, if you submitted a proposal and made a mistake, you can't really re-nig on a contract. Were you being fecicous when you said you skipped over 300 sq ft of tile? To me that would seem hard to miss. If they added extra areas to be tiled, or changed details, than I can see a change order being needed.

It all comes down to this:

did you have a signed acceptance on a proposal?
did that proposal have a time clause in it? (project start/finish date(s) - time lapse that proposal must be accepted by)

and if there are any deviations/changes, that's what change orders are for
It's really just nitty gritty "contract" stuff. But as a contractor, that is a major part of your job.

I don't see how you could have gotten out of the loop, being a consultant. Who consulted with the consultant about the changes? [insert scratch head smiley]

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Bodger

It sounds to me like they should be happy with the prices they are getting, and the fact that you are honoring the somewhat outdated quote for the original work and quoting fair market for the additional items.

What's right is right, a tradesman being fair on everything else should not be asked to work for free for the sole reason that a H/O spent too much on other things. Let them go without. I'll bet they don't get to name their price on gas or groceries, why should they be allowed to do it on their tile?
I have to say, as a GC, I wouldn't ask a sub to reduce price for the sole reason that the H/O has spent too much on other things.

Tinstaafl

HAHA!

neolitic

I've got one now (no where near your money).
Deck re-skin and hot tub refurb.
First HO decides to go with a new tub
instead of the refurb. $
He is having the master bath redone,
makes some up grades. $$$
They run into structural problems
with the bath. $$$$
I do the tear off and the deck frame
is a total joke, so now it's a complete
re-frame. $$$$$
He says to me, "Man you know
that deck is getting pretty expensive!
Can't we cut the cost somewhere?"

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neolitic

Oddly none of the surcharges
or jacked up lumber delivery
prices or material price increases
have come down at all.

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Bodger

He should to go to work tomorrow and ask his boss for a raise because his deck project is costing more than he wanted to spend. See how that helps to take the sting out of the price.
Or, if he runs his own business, just raise the hell out of what he charges and that should cover it.
Sometimes I think that because we work for ourselves, people think we should just let them set their own prices.
Some people seem to think that tradesmen are tradesmen because they are too dumb to do anything else.

Gets my arse really red sometimes.

neolitic

Funny thing is the guy does have his
own business.
He's got guys installing balcony railings
on one of Killer's Chicago high-rises
as we speak.
I offered to cut 2k for cedar rather
than Azek (keeping my Azek mark-up
on the cedar).

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