When the Client Calls a Meeting
As professional general contractors, we've all been there: you're somewhere in the middle of a remodeling project's life cycle, and the homeowners email or text you, asking, "Can we have a meeting?" And instantly, you know something is up, whether it's the budget, the schedule, an issue with the project manager, or something else on site.
And now you're worried that trouble is brewing.
When a client wants to discuss something about their home renovation project outside of regularly established check-in points, it can be nerve-wracking because you don't know what's triggering it. The key to navigating those situations is to go into the meeting with your ears open to really hear what the client has to say and to work together to answer their questions or resolve any concerns.
Projects Can Go Sideways for Many Reasons
If you've been in this industry for any length of time, you know that it's more than likely to have challenges on home remodeling projects. If those challenges are neglected or left for clients to discover on their own, they can fracture client trust and affect the overall project's success.
Three Things That Can Strain a Residential Construction Project
Budget Overruns
There are a number of reasons why a budget can go over on during the renovation process or on a custom building project. Things like changing material costs due to a large gap between the time a project is estimated and production starts, or a trade partner can suddenly be unavailable, causing a potential price change by using someone else. Unforeseen issues such as structural problems can also add costs to a project, and of course, client changes from the client who previously said, "Don't worry, we won't change our minds!"
Project Delays
Many things can impact a project's timelines and cause them to take longer than anticipated, such as trouble getting alignment from homeowners and design partners during the design process for material finishes, trade partner availability, poor project management practices that cause delays in material deliveries, and adverse weather conditions and tight building lots that wreak havoc on your plans.
Project Management Issues
This is a huge one and often happens when builders, design partners, and homeowners aren't on the same page, but remember, it's on the builder to ensure they are keeping everyone aligned on project progress. Poor communication or lack of communication between project managers and clients can often lead to uncertainty and inefficiency on the job site, which is when costly mistakes happen.
It's Your Job to Keep the Client Informed
Homeowners hire residential builders to execute a vision for them, and as a professional, an important aspect of your job is to be proactive about updating them on everything that's happening with their home.
Quite simply, if a client comes to you asking about the budget, the timeline, or the next steps in the project, you've failed. This can quickly lead to frustration on their part and strain the relationship. But there is hope about what you can do to get things back on track.
While it's hard to be proactive with every client because you're often being pulled in multiple directions, consider that doing this would eventually reduce being stretched every minute of the day. Being proactive with client communication starts with your project management. And if you have others doing this for you, you need to follow these key things:
Meet with each PM weekly to review their Weekly Status Report (WSR)
During this meeting, review what Change Orders need to be issued and ensure they get the support they need to feel confident making this happen
Ensure that you advise clients of project progress daily and don't wait to deliver bad news because you never want them to discover the issue for themselves first
If you need help with Project Management Training, click here to book a time to learn more about our Project Management Program.
What to Do When the Client Asks for a Meeting
There's nothing more ominous than a client asking for an unscheduled meeting after expressing concern about their renovation's progress. And it can send you right into a tailspin of "what ifs." But the most important thing to remember is not to panic. Panic doesn't get you anywhere, and it certainly doesn't help put the client at ease.
Remodeling or custom building a home is the single largest investment a homeowner will make. Often, those investments can be bank-funded, which means clients have a finite amount of funds available to use and are answerable to someone else on how they use them.
But even if they are liquid enough to fund their renovation project without the aid of a bank, if they're presented with additional invoices for overages or significant delays, they're naturally going to have questions.
How you answer them - and how prepared you are going into that meeting, is key.
Remember, It's Not Always "Doom and Gloom"
At one point or another, every builder has thought they'd walk into a client meeting and find themselves walking out having lost the job. While there are cases where this happens, it's usually the exception to the rule.
If you've ever taken over a project mid-build, you can appreciate just how enormous a task that is and what a huge impact it can have on the overall budget and timeline. It's a big task for both a builder and a client to have someone else takeover a large project, and more often than not, the quickest path to completion is to stick with the person they're already working with. So silence that mind goblin and focus on these next steps instead.
Don't Let It Fester
Responding to a client's request is almost as important as the speed at which you do it. Don't let this brew with a client because that can often build up emotional anxiety, resulting in a more adversarial and confrontational meeting when it occurs.
Prepare
In order to come prepared, you first need to do a full assessment of your progress on all project components and prepare supporting documentation that you can present to the client. This will look a bit different if you're fixed cost versus cost-plus, but you should have a complete picture of the project when heading into the meeting.
1. Assess Trade Costs
Ensure that all of the remaining trade costs are accurate based on the original contract amount, approved change orders, and payments to date. If you're a fixed-cost builder, you need to determine if any of the current contracts require change orders for additional scope of work that hasn't been captured yet. If you're sharing this information with clients in a cost-plus format, then tabulate this within your Cost to Completion (CTC) tracker.
Need help with this? Click here to get a demo of Buildwise, our financial management software built specifically for builders and remodelers.
2. Review Outstanding Trade Hires
Review how much of the project you have "bought out" and list out the remaining trades left to hire and the budget amount you're carrying. Assess these unknown costs based on the project's progress, and adjust these as "expected" costs you might incur. If you're cost plus, this can be indicated on the CTC, and if you're fixed cost, you can prepare a list of the trades and highlight any potential overages you think might occur, making sure to include your markup in the numbers you present.
3. Organize Remaining Decisions Needed
Create a list of outstanding design selection items or scope of work elements you are waiting on information about. This is best organized in a table that highlights:
The cost group (aka cost code) this is associated with
What the item is
Clarity into what information you need
Who this is assigned to
When the task is due
The budget amount
I recommend using Cash Allowances for design decisions, which work for both cost-plus and fixed-cost clients. For more on how to use allowances in residential building, click here.
4. Confirming In-House Labor Details
If you have in-house labor, review this in detail and ensure that:
You evaluate what tasks are a good fit for you to self-perform versus subcontract out.
You have enough money in the budget for this, and if not, annotate what you expect the overage to be (cost-plus) and 👇🏻
You consider hiring out components of this to get more cost certainty where applicable.
The Most Important Thing
The purpose of the documentation phase above is to ensure you have put together a full financial picture of where their project stands in a format the client can digest. It's important—and I cannot stress this enough—to be as accurate and honest as possible because you can only go back to the client with this information once. You're not going to have another shot at it, so you need to make sure you're asking yourself the right questions and that what you're documenting, you can stand behind in whatever capacity that looks like.
What Not to Do in a Client Update Meeting
Along with what you must do to prepare for the meeting, there are a couple of things to remember NOT to do:
Don't Throw the Client Under the Bus
It's not uncommon for clients to get "sticker shock" at the onset of a project and cut scope to align with their financial investment but then slowly add scope back in once the project progresses. This is where budgets can run amok if we're not careful about communicating our support for their vision but also clearly demonstrating how those changes impact overall budget and timing, and seeking clarity on whether or not to proceed.
We have to remember that it's our job to ensure we communicate efficiently and effectively with our clients and gain the right alignment upstream to avoid issues downstream. Remodeling or custom-building a house is a huge investment for homeowners. And often, they might need reassurance from you that the process is organic and that the amount they are spending is a sound financial investment. So don't point fingers at them when the budget continues to climb because no one likes to be called out. Make sure to follow a solid change order process as these decisions are made to avoid this problem downstream.
Don't Give Away the Farm
Trying to fix a runaway project is about understanding what it will take to appease the client and keep the project moving while not forcing yourself into bankruptcy in the process. This is where you want to keep your cards close to your chest and listen to what the client has to say while knowing in your back pocket that you have what Chris Voss calls your BATNA (Best Alternative To the Negotiated Agreement.)
Know what you will accept going into the meeting so you can do with that without the emotional pressure of having to give it all away.
Maybe you're thinking you have to give away the farm, but the client only wanted a couple of goats.
Don't Panic if the Client Throws a Curveball
The best thing you can do when the client asks for a meeting is come prepared with as much information as possible. But even with all that preparation, the client might ask you something you don't have an answer for. And that's perfectly fine.
Reiterate what you heard and let the client know you're going to take that away to give it some proper thought and reconvene at another time to discuss that you set before the current meeting ends. This ensures that the clients feel heard but also gives you a chance to think logically about what they're asking outside the room and away from any high-running emotions. Make sure to do it quickly, as they won't want to wait too long for your decision, so try to schedule this for less than five days from the current meeting.
The Bottom Line on Client's Asking for Meetings
When a client wants to talk about their construction projects without being prompted, it can be a nerve-wracking moment, but it doesn't have to spell disaster if you go into that discussion with a plan. Ideally, the best scenario is the one where you don't end up getting that call, text, or email, but if you do, it's important to know how to handle it.
In the end, managing client expectations is just part of the job for professional contractors - something you know well from previous projects. When a project starts to wobble, it usually boils down to mismatched budget expectations, poor communication and project management, or unforeseen complications.
A good contractor knows to approach the meeting ready to listen, explain clearly, and outline a path forward without playing the blame game. By staying calm, prepared, and transparent, you can turn a potentially tough situation into a chance to build even more trust with your client. After all, every challenge is just another opportunity to show that your team is the right team based on your professionalism and commitment to a successful project.
Are you looking for software tailored to the residential construction industry that can truly show you your project costs?
I created BUILDWISE to help remodelers and custom home builders keep their project finances organized, know their margins in real-time, and make the process of communicating costs to clients easy so you can profit like you deserve.
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