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September 17, 2018   |   By Kristy Welsh
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Avoiding Unbudgeted Construction Costs

Almost all construction projects will vary from the original design, specifications and drawings issued by your chosen design and construct team. This is due to a number of reasons but is largely caused by continued development of the design after the project has been awarded.

What some business owner’s may not be aware of, is the fact that variation orders are a substantial cause of unbudgeted construction costs. Fortunately, in many cases variations can be avoided… if you know what to look for.

 

Variation Orders

What is a variation order?

A variation order involves an amendment to the original scope of work.

What constitutes as a variation?

A variation can be a change to:

  • Materials used
  • Detail of works
  • Dimension or level of the works
  • Design
  • Order in which things are constructed

 

Example: you have your design, you’ve secured DA Approval, a Construction Certificate and have awarded a builder. They commence earthworks and hit hard rock – this will unlikely be factored into the original scope of works and given hard rock is more difficult to deal with, a different foundation and redesign may be required as a result.

How can variations derail your project budget?

In many instances, the need for variations are a result of miscommunication, misunderstanding or lack of clarity in contracts – thus can seemingly emerge out of nowhere. Variations can significantly impact on deadlines and completion dates which also results in additional expenses.

How to avoid expensive variations

  • Ask potential contractors/builders to visit your site before quoting the works. This allows for the identification of any potential issues with the site or suggested design.
  • Ensure that you are provided with a comprehensive quote and detailed trade breakdown
  • Engage a skilled and trusted design and construct firm. In Akura’s case, we have a very thorough pre-construction process so there is not a lot of room for surprises. This process involves a feasibility checklist and scope of works reporting so we know exactly what is involved and can quote accordingly. We work with our clients to discuss current and future requirements, and optimise the design to ensure the building is fit for purpose, and provides the best possible return on investment.
  • Familiarise yourself with your builder’s exclusions along with the terms & conditions of the contract
  • If you choose to manage the project yourself, involve the construction team in the design process – this ensures that they are better able to plan works with a more thorough understanding of the entire project. They can suggest optimisations to the design along with best materials to be used; thus ultimately iron out any wrinkles before construction commences
  • Further to the above point, ensure that your drawings and design include input from each discipline i.e. plumbing, electrical etc
  • Be wary of builders who present low-balling quotes in the hope of securing the job. They will generally push up their margins by charging mercilessly for variations
  • Understand that any changes you make after construction commences will impact on budget and timelines.
 

Skilled Design & Construction Team

With 40 years’ experience in the construction industry, Akura are skilled at delivering complete design and construct services for developments within the industrial, commercial and agricultural sectors.

With an in-house architect, engineer and draftsmen, along with an experienced construction team – we work seamlessly with our clients to deliver buildings that are designed and constructed for your eye, budget and needs. Our Project Managers work with our clients from day one to help tailor the design, get it through Council and oversee its successful development.

We have taken streamlined construction to the next level by manufacturing our own structural steel and precast concrete panels which minimises issues associated with material quality and availability. Coupled with the fact we own our own machinery – we have near complete control of construction.

To discuss your construction plans or to get a free quote, contact the friendly Akura team.

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