Punch lists can make or break a contract—when done quickly and seamlessly, you can get paid and move on to your next project. If they drag out, they can compromise your profit margin and leave you with unhappy customers.
You can mitigate punch-list problems by having a procedure in place and communicating that procedure to clients when you start the build. Include this process in your contract and go through it again before you begin. Effective communication here can really help to streamline this process and get you on to your next project.
Set the Stage
When you start getting to the last few weeks of a project, set a date for the final walk-through. Explain that you will have a list of things that need to be finished or adjusted before handoff. It is important to explain that homeowners can add to the list during walkthrough, but not after it.
Define what kinds of things can be added to a punch list as some clients will want to make aesthetic or design changes at this time. These are not part of the punch list, but new or separate projects that will need to be booked and invoiced separately.
Get Paid
If you’re on track, the punch list should only feature a few minor things. You can calculate the cost of these jobs and allow the client to withhold payment for the items on the punch list until it is complete. This will mean you still get the payment for work done and are able to keep your cash flow up for your next project. You should not allow clients to withhold large sums of money for a few minor things that need to be done. It’s a good idea to put this in your contract.
Do your Part
Once your project is complete and most of your crew has moved on to the next job, it can be easy to put off completing the tasks on a punch list. However, this part is crucial if you want to keep clients happy. Try to finish the punch list within 30 days of the final walkthrough. If you are waiting for materials, this may not be possible, but do your part where you can. This means your clients can move in and feel happy and you get the best kind of marketing available – a recommendation!