Variation control

A variation is not profit just because the client approved a price.

Variations need revenue, direct cost, flow-on cost and timing visibility. Otherwise the project can show additional contract value while the actual margin on the change is unclear.

The useful variation view

Revenue

Approved value

What the client has formally approved or what the contract supports as recoverable.

Cost

Expected delivery cost

Trade, material, labour, supervision and other cost required to complete the changed scope.

Margin

Net commercial effect

The expected contribution after associated cost is recognised in the forecast.

Where variation reporting fails

  • Work starts before the commercial instruction is clear.
  • Supplier or subcontractor changes are recorded but client recovery is not linked.
  • Markup is applied to only part of the actual cost impact.
  • Delays, remobilisation or preliminaries are ignored.
  • Approved variation revenue is added while the cost-to-complete allowance is left unchanged.

Control sequence

Identify

Capture the changed scope and contractual basis.

Price

Build the expected cost and recovery before approval where possible.

Approve

Separate approved, pending and rejected positions.

Forecast

Reflect both the revenue and cost effect in the current project outcome.

Related workflow

Quantities changed as well?

If a drawing revision changes measurable residential scope, MeasureBuild can support the quantity review before the variation is priced and forecast.

Related resources