U for residential and light commercial
construction has been a common
practice for years. Allowance figures
enable both the contractor and client to
establish budget “place holders” for certain
project details that may not be
decided at the time of contract signing.
But allowances can create pitfalls for
both parties if they aren’t handled correctly.
Following a few simple guidelines
for using allowances will help you to
provide excellent service and value for
your clients while protecting your bottom
line at the same time.
Strive for Accuracy
I have seen numerous situations
where specifications and
contracts stated allowances that
were much too low to meet the
client’s needs — an $800 finish
flooring allowance for a 2,800-
square-foot new home, for