Change Order fees for Residential General Contractors?? - Contractor Talk - Professional Construction and Remodeling Forum

SBI · 09-29-2008, 12:24 PM

Hey guys, my Dad and I were discussing change order fees for residential construction that we apply vs other general contractors and I was wondering what you other general contractors out there charged for change order fees in residential home construction??

We have a system of a price minimum to accomodate us for our time and effort out of the day (since it is out of the original scope of work and not in the budget) to cover our time spent on the phone, driving, etc....

That price minimum is applied to change orders of a certain amount ($$) or less with the possibility of a higher fee at our discretion depending on the time we have to spend to get things together, drive somewhere if necessary, or simply the aggrevation of it. Then we have a certain percentage of the work to be performed, materials and so forth that we apply for the fee as a minimum from that specified change order amount or great in costs. Again, a higher fee is at our discretion if we feel we had to go well beyond out of our way to get things together.

I will show those costs after I have seen a few replies, but was just wondering what you other general contractors were charging for change order fees, percentages, minimums, etc......

Thanks.

rbsremodeling · 09-29-2008, 12:39 PM

Quote:

Originally Posted by sbi

hey guys, my dad and i were discussing change order fees for residential construction that we apply vs other general contractors and i was wondering what you other general contractors out there charged for change order fees in residential home construction??

We have a system of a price minimum to accomodate us for our time and effort out of the day (since it is out of the original scope of work and not in the budget) to cover our time spent on the phone, driving, etc....

That price minimum is applied to change orders of a certain amount ($$) or less with the possibility of a higher fee at our discretion depending on the time we have to spend to get things together, drive somewhere if necessary, or simply the aggrevation of it. Then we have a certain percentage of the work to be performed, materials and so forth that we apply for the fee as a minimum from that specified change order amount or great in costs. Again, a higher fee is at our discretion if we feel we had to go well beyond out of our way to get things together.

I will show those costs after i have seen a few replies, but was just wondering what you other general contractors were charging for change order fees, percentages, minimums, etc......

Thanks.

$450 sometimes it is shown sometimes not. and waived sometimes

SBI · 09-29-2008, 01:08 PM

$450 is what your change order fee is all the time??

What about if the change order costs to you (sub labor and material) is only about $100 or $150....something small?? You still charge $450 on top of that for your time and effort? or is that one of the times you waive the fee unless you just spent hours on that little change order?

For instance, we had a customer call today to ask what it would cost to run crown mold. and chair rail on into a small hallway between 2 bedrooms. And after 2 phone calls I determined that there was enough material already on site to do that, Trim guys labor was only $60 extra and the painter said add about $40-50 to paint that small amount for him, then I threw a $100 on it for my time, which wasn't much at all. I would have only put about $50 on it (our minimum) but this customer has been particularly aggrevating on multiple occasions and continues to be that way. Aggrevating Customer Change Order fee ....

Just wondering how that works with everybody. If you have something small like that and throw $450 or even like $250 on it, especially when the customer is half knowledgable about the industry, it just wont fly too well with them or your reputation as a builder....in my opinion. Then again I may be looking at it the wrong way.

rbsremodeling · 09-29-2008, 01:18 PM

Quote:

Originally Posted by SBI

$450 is what your change order fee is all the time??

What about if the change order costs to you (sub labor and material) is only about $100 or $150....something small?? You still charge $450 on top of that for your time and effort? or is that one of the times you waive the fee unless you just spent hours on that little change order?

For instance, we had a customer call today to ask what it would cost to run crown mold. and chair rail on into a small hallway between 2 bedrooms. And after 2 phone calls I determined that there was enough material already on site to do that, Trim guys labor was only $60 extra and the painter said add about $40-50 to paint that small amount for him, then I threw a $100 on it for my time, which wasn't much at all. I would have only put about $50 on it (our minimum) but this customer has been particularly aggrevating on multiple occasions and continues to be that way. Aggrevating Customer Change Order fee ....

Just wondering how that works with everybody. If you have something small like that and throw $450 or even like $250 on it, especially when the customer is half knowledgable about the industry, it just wont fly too well with them or your reputation as a builder....in my opinion. Then again I may be looking at it the wrong way.

Yes 2 hours of my time and 3 hours of the admins time. If it is simple it will be waived.

It will fly if its in the contract they signed.

kevjob · 09-29-2008, 02:59 PM

we do a flat fee of usually around 100.00 depending upon how detailed the change order needs to be.

SBI · 09-29-2008, 03:05 PM

Quote:

Originally Posted by rbsremodeling

Yes 2 hours of my time and 3 hours of the admins time. If it is simple it will be waived.

It will fly if its in the contract they signed.

That is true!! Will always fly it its in the contract....haha. Our change order fee process is in the contract too, just not that large...unless the time involved is drastic and/or the change order work to be performed and material is very large.

rbsremodeling · 09-29-2008, 03:09 PM

Quote:

Originally Posted by SBI

That is true!! Will always fly it its in the contract....haha. Our change order fee process is in the contract too, just not that large...unless the time involved is drastic and/or the change order work to be performed and material is very large.

My change orders are usually large and usually takes some research and a couple of phone calls