Every builder has their own horror story of how scope creep annihilated their profit margin on a job. But typically, it is a lesson that is quickly learned and not repeated.
“Scoop creep” is the term used for a building project that seems to morph past its original designs until you end up doing a lot more than you anticipated or agreed to do. Below are some tips for avoiding scope creep on your next building project.
Recognize the red flags
Do you have a difficult client who is prone to changing the plans mid-build?
This is a major red flag for scope creep. Most contractors are willing to do all they can to keep clients happy but failing to adhere to the contract you established with a client can cost you lots of money.
How scope creep begins
Multiple factors can coalesce to make the risk of scope creep higher than usual, including:
- Improperly analyzing the original scope of the build
- Poor communication between the client, the contractor and any subs involved with the build
- Weak contracts that are open to different interpretations
- Grifter clients who always want something for nothing
- Not having a clear protocol to follow when orders change
- A strong contract is the best defense against scope creep
By letting your business law attorney draft or approve all contracts for your company, you reduce the likelihood of scope creep becoming a major problem with your client. When changes are proposed, do a contract review with the client and point out what is and is not covered under its terms.
Any changes to those terms and costs should be signed off on by the client, the contractor and any relevant subcontractors. Failing to get signatures can leave you holding the liability bag and footing the bill for the proposed changes.