Pricing & Profiting in Remodeling

Welcome

Hello, and welcome. This is Super Structures General Contractors — a national general contractor headquartered in Powhatan, Virginia — here to help you and your clients build something that lasts. We're glad you're with us, and we look forward to connecting with you.

Buckle up: Pricing & Profiting in Remodeling is one of those skills the pros never skip. Here's the big idea to walk away with: Price remodels with allowances and contingency for the unknowns — and control change orders in writing; scope creep is the #1 profit killer. Get comfortable here and the rest of this trade gets a whole lot less intimidating.

Remodeling is profitable — if you price and manage it right.

Price for the unknowns

• Cover direct cost + overhead + profit (mind markup vs. margin).
• Use allowances for selections the homeowner hasn't finalized.
• Build in contingency for the surprises hidden in existing homes.

Control change orders

Remodels generate lots of changes — "while you're here, can you also…" Price and approve every change in writing before doing it; uncontrolled scope creep is the #1 profit killer in remodeling.

Going Deeper (Intermediate)

Remodeling is profitable if priced and managed right: cover direct cost + overhead + profit (mind markup vs. margin), use allowances for undecided selections, and build a contingency for the unknowns. Then control change orders in writing — uncontrolled scope creep is the #1 profit killer.

Advanced / Pro-Level

Pricing and protecting the margin:

• Pricing models — fixed price, cost-plus, or design-build with a not-to-exceed.
• Allowances done right — realistic numbers, clear about what's included, and reconciled to actual.
• Contingency for hidden conditions.
• Markup vs. margin math (and remember small jobs need higher markup).
• Change-order discipline — every "while you're here" request is priced and signed, every time.
• Job-cost each remodel to learn for the next bid. Scope creep and underpricing the unknowns are what quietly turn a "good job" into a loss.

Practice Challenge

A remodeler keeps saying "sure, no problem" to extra requests without change orders, and the profit vanishes. What two disciplines were missing? (Answer: change-order discipline (price and get every extra signed before doing it — uncontrolled scope creep is the #1 profit killer) and proper pricing of the unknowns (allowances + contingency); saying yes to "while you're here" requests for free converts margin into free work.)

In Practice

A remodeler keeps saying 'sure, while we're here' to extra requests with no change orders — and the profit vanishes. Price changes in writing; scope creep is the #1 killer.

Common Mistakes to Avoid

• Letting scope creep go unpriced
• No allowances or contingency
• Underpricing the unknowns

Takeaway: Price remodels with allowances and contingency for the unknowns — and control change orders in writing; scope creep is the #1 profit killer.

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