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July 20, 2023 at 9:00 AM
by J. Schwartz,llc Remodeling & Fine Home Building
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It is important to understand what a change order is, and how they may be used in your project. We understand that other contractors may not utilize the change order in the same way that J. Schwartz,llc does - but in our opinion, the way that we use them is the way that they should be used,

In simple terms, a change order is the presentation for approval (and discussion) of any change in scope and/or specification from the contracted work scope and/or specification. This means that a change order may or may not have a cost associated with it, and if it does, that dollar amount may be a negative (credit) or an added cost.

As a simple example of a "zero dollar" change order: Let's say that the specifications or plans call for the new bedroom paint to be an eggshell finish in a blue color, but you as the homeowner have requested to change it to a eggshell finish in a green color. In this scenario, we would input a change order into our project management system that states that this is a zero cost change order, and would then explain within that change order that the color and finish of the bedroom paint has changed from the eggshell blue to the eggshell green. You would simple approve that change and would then have a log of the change for future records.

A simple example of a change order with an associated added cost would be if you have decided to add scope to the project - for example you have decided that you want to replace your front door - and that was not included in the original plans or specification. In this case, we present you with a change order that shows all of the associated costs - removal of the old door, supply and install of the new one, install of the hardware, and painting the door, along with the agreed upon fee. This change order is sent to you electronically for review, comment and approval. Once approved, it is added to the project contract amount, and the work is started. If you've cahnged your mind, you simple reject the change order and it is not added to the project, and the scope is not changed.

A credit change order would be if you request a scope decrease or an allowance comes in under budget - for example, we have built in $5,000 for counter tops in the budget, but after shopping for them together, we find them for $3000.00 - you would then get a credit change order showing a credit to the project of the saved amount of $2000.00. Once yove approved it, we would purchase the counters and the credit would be included in the overall job cost.

Our change orders are always "open book", meaning that all actual costs are presented and the fees that are stated in the contract are added, so that change orders are not any more costly than if that new scope had been included in the intial contract. We undertake change orders this way because we want our clients to be happy with outcome, get everything that they want, and know that the process is honest and open. We want our clients to ask for any changes that they may be considering - we will price it, and then you can make an informed decision based on the value-added and cost.