Price the added scope before work begins
A change order should recover the direct cost of the extra work, the overhead it creates, and the profit margin required by your business. The calculator applies overhead to direct cost, then prices the total cost for the selected margin.
Worked example
$780 in materials, $250 in equipment or subcontractors, and 12 hours at $38 produce $1,486 in direct cost. At 12% overhead, total cost is $1,664.32. A 25% margin produces a change order price of $2,219.09 and estimated profit of $554.77.
Price is only one part of a change order. Document the revised scope, exclusions, schedule impact, payment terms, and written approval.
Change order questions
Why include overhead and profit?
Extra work still consumes coordination, administration, insurance, tools, and business capacity. Direct cost alone does not recover those items.
Should work start before approval?
Contract requirements vary, but written approval helps establish scope, price, and schedule expectations before costs are incurred.
What is not included here?
Taxes, permit fees, bonds, financing, delay costs, and contract-specific markups are not automatic. Add them where applicable.