Quote:
Originally Posted by XLexusTech
For example.. you as a customer budgeted for 100k which was driven from an estimate which encompasses tasks 1-25. For simplicity sake lets assume the 100K is broken into equal tasks @ 4K per task and you put down 25%...... 25K.
You get an invoice after 1 month that indicates that 4 tasks are complete but all of the 25K is gone....... which based on the simple math.. your 100K project is now a 156K project... ~60% increase in cost with no increase in scope... 
Edit: the same thing can happen in smaller increments.. (weekly invoice) in fact I would suggest that when it does the variance from estimate will be larger in the end... you will just know about it sooner.... Death of a thousand cuts :-) |
I follow what you are saying but there are safe guards built into the weekly or bi weekly bills. First, I never would put down any amount of money for labor! The shop should only bill you for labor DONE not labor that is going to be done so NO 25k is out of pocket. If a shop bills me $5,000 for a task that was suppose to cost $2,000...my car is gone and I am only out $3,000. If I keep paying these bills that are higher than agreed...that solely lies on me