Starting work with no price: what it really costs

The window is rattling in a gale, the plasterer is booked for Thursday, and the electrician says he can start tomorrow if you just say go. The price is "roughly sorted". You say go.

Nothing is wrong with that, once. The trouble is that it becomes the habit, and the habit is where margins go to disappear.

Where the money goes

Work with no price has no budget to be measured against. That means three things.

• You cannot see the overrun. There is nothing to compare actual cost with, so the first sign of trouble is the invoice.
• The price is set by whoever is more motivated. After the work is done, a business knows you need it finished, and a client knows you want to be paid. Neither of those helps you.
• Variations get fuzzy. If you did not agree what the work cost, it is harder to say what a change to it cost.

Starting unpriced is sometimes right

There are good reasons to start before the price is final. Weather, a site programme that cannot wait, a trusted business, an urgent defect. The aim is not to ban it. The aim is to make it a decision somebody made on purpose, for a reason you can read later.

A rule with three settings

Most companies sit in one of three places, and it helps to choose the setting for each project instead of leaving it to whoever is on site.

1. Allow it. You price after the work, as some companies always have. Fine if you mean it.
2. Warn, and ask for a reason. The task shows as not priced, and whoever starts it says why. Nothing is blocked, and the reason is kept on the task.
3. Block it. The task cannot start until it has a price or an allowance. This suits companies that never work unpriced.

For most builders the middle setting is the honest one. It keeps the site moving, and it turns "we just started" into a line in the record.

Make pricing the easy path

A rule only works if the right thing is easy. When a task has no price, the person looking at it should see the two ways to fix that. If you are paying for the work, ask a business for a price. If the client should pay for it, raise a variation. Both should start from the task, so nobody has to re-enter what the work is.

What to do this week

1. Look at your active jobs and count tasks with no price and no allowance.
2. Decide the setting for each job, not for the company.
3. When someone starts unpriced work, read the reason. Patterns show up quickly.

Novato marks tasks that are not priced, shows where each price came from, and lets each project choose whether unpriced starts are allowed, warned with a reason, or blocked.