APRIL JLC 1997 6
Allowance Markup
To the Editor:
In response to the article "Allowance
Pricing That Works" (1/97), we have a
suggestion. In addition to defining
allowance items with the owners as
closely as possible, we explain that
owners who overspend will owe us the
overspent amount plus a 15% markup.
Because our overhead and profit are
based upon the gross job amount, no
O&P credit is given if they should
spend less on allowance items. We
have the following language in our
contract that might be useful for your
readers:
At completion of project, a final
allowance tally will be presented to owner
with all allowance items at contractor's
cost including tax and delivery. Any
unused dollar amount of