When a Quote Turns Out Too Low

It happens to everyone - you quote a job, start the work, and realize the actual cost is coming in higher than expected.  Even the most experienced contractors can run into this tough situation. 

No one looks forward to the conversation with the client.  How you handle it says a lot about your professionalism and your integrity.

At Finger Lakes Work Place, we work with contractors who believe honesty and clear communication are key to every project.  Here are some ways you can manage these situations, and what your clients can expect when it happens.

• Start with Why: As soon as you notice the quote is going to be off, determine the why.  Most issues are fairly common, and understanding the "Why" helps determine what happens next.
• Scope Changes - Customer requests additional work, materials or upgrades after the quote is approved
• Hidden Issues - Problems behind walls, underground, or other things that weren't visible during the initial walk through
• Material Price Changes - Prices can go up unexpectedly
• Estimator Error - A simple underestimation of the time or materials required, or even a math error.
• Communicate ASAP: Surprises are not good when it comes to contract work.  Reach out to the client as soon as you see the issue.  A quick call to make everyone aware and on the same page.  This also builds trust and gives the client time to make informed decisions before additional work is done.
• Get it in Writing: If something changes, don't just shake on it.  Putting changes in writing protects everyone involved.  Issue a change order covering
• What's changed
• Why it's needed
• Any changes in the initial estimate cost and time frame
• Contractors Mistake? Sometimes, the underbid was just human error.  If that's the case, own it.  People make mistakes, and the client will appreciate the transparency.  Often, if the difference is small, a good practice is to absorb it.  If it is a larger difference, discuss options with the client and try to find a fair resolution.  This will earn trust, respect, and repeat business.
• Learn from Mistakes: Treating every experience as a learning experience, especially when things go wrong, is a great way to improve all aspects of your business, not just quoting.  Some lessons learned can include spending more time on the initial walk through, taking that extra step to dig a little deeper, of building in contingency percentages to account for surprises.  Your goal shouldn't change - quality work, fair prices, and no surprises.

No one likes the feeling of finding out the project will cost more than anticipated.  Honestly communicating and documenting go a long way in turning a potentially stressful situation into an opportunity to display your integrity.

At Finger Lakes Work Place, we're committed to being transparent, professional, and doing things the right way, even when that's not the easiest path.  Trust isn't built by delivering perfect estimates, it's built on how you handle the unexpected.

Have any Low Voltage Cabling, Security Camera installs, or other projects you'd like a trusted partner to work with?  Feel free to email me at aaron@flworkplace.com or grab a slot on my calendar to discuss!

Cheers!

Aaron