This is Part 3 in a multiple-part series on understanding the home technology sales process. In the last post we discussed the importance of design and engineering. In this post we will explore the installation life cycle as it pertains to sales.
As a client, you could not be faulted for thinking that the sales process ended when you signed a contract. In construction, however, that is rarely the case. Given the rapidly evolving nature of technology, home automation projects that last any longer than a few months are susceptible to change orders. These changes can be incurred as a result of many factors including:
- Discontinuation of specified parts
- Incompatibilities introduced by new standards
- New technologies becoming available that will prove a better fit for the project
- Scope change brought about by client requests for additional features
- Unforeseeable challenges brought about by the nature of construction (this is particularly true for retrofit work)
Keeping track of changes through the course of the project is vital. Make sure everything is in writing! Even change orders that result in a zero-dollar difference to the bottom line should be documented and signed-off before work continues. This ensures that when the project comes to completion, there is an accurate understanding of additional charges and / or scope change that came about during the course of the project.
Another item related to the installation life cycle of your project will be payment schedules. Laws vary in different states. But here in California for instance, no contractor is allowed to ask for a down payment of more than $1,000, or 10% of the total contract (whichever is less). However, depending on the scope and timeline of your project, many will request a deposit early on for the purchasing of equipment. Every integrator will handle payment schedules slightly differently. The important thing is to not let the money get too far out ahead of the work being completed. Make sure the contract explicitly lays out payment amounts in a schedule, and ties those amounts to milestones (i.e. work completed). Examples of these milestones may include things like:
- Prewire materials ordering
- Prewire completion
- Finish equipment deposit
- Equipment delivery to job site
- Project completion & client sign-off
As with any contractor, when dealing with an integrator it's important to realize are entering what will hopefully be a long-term, and mutually beneficial relationship. Make sure you have an open dialogue with your integrator at the outset about the ways in which change orders and payment schedules will be handled. Keeping an eye on the bottom line can get difficult if it's not managed properly from the beginning. So make sure to have these conversations early in the process. This will minimize any potential for friction related to money and contract scope, and allow you and your integrator to focus on what matters... the tech!
Check out the next post where we'll discuss the ever-important completion and sign-off phase...