Design/Build - Cost Adjustments

[Designer69]

If an electrical contractor is selected as the winning bidder for a project at a certain cost that they bid but then later during construction it is decided that an elec. equipment is downgraded to something that costs $20K less, does the Elec. Contractor reimburse the General Contractor for this difference or do they just say nope, doesn't matter they get what their initial bid was on original drawings regardless of what is installed.


Just want to understand how this generally works, Thanks.

 

[infinity]

We always give credits for design changes. Having said that they are never 100% of the value of the change so the boss keeps a little extra for his trouble. If I had to guess I would think that the wording for this is buried somewhere in the contract.

 

[brantmacga]

If it’s design/build, you have an obligation to give them what they’re paying for or issue a credit for the VE option.

If there’s an EE involved, and they issue a change-order, they will advise the architect that a credit is due, and they’ll typically review your billing to verify.


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[Ingenieur]

think of it like this
you buy a car with a big optional engine, the car delivered has a smaller base one
you are due a credit

they will typically keep profit and oh and handling, restocking, freight, etc if material was previously approved and ordered

I prefer to do it at the end
I advise them and ask them if they agree, most say ok
they submit, we review/barter, then approve
document all adds and deducts, itemize, and issue one co for the balance at the end