Death by VPO: Ending the Nightmare called Variance

Variance – any cost that occurs beyond the original contracted price at the release of a home for production – is a failure. Whether you call it VPO (variance purchase order,) FPO (field purchase order) EPO (extra purchase order) or simply “extras” or “variance,” there is significant  loss. It may fall to the supplier, the trade, the customer, the builder, or any combination of those. Variance depletes your margins, exhausts your staff, frustrates your supplier & trades and bewilders your customers.  Yet, few builders measure the right things, and those who do usually measure them wrong. The old adage, “you cannot manage what you cannot measure” has never applied more perfectly – or painfully. In fact, the single largest cost factor regarding variance, resulting in more than half of the loss, is virtually never calculated. How can that be? If you are tired of the huge negative impact of variance on profit and personnel, or perhaps suspect that 1% variance you brag about has not fully captured the total cost, come to this session and learn. A huge improvement in business operations awaits you – and most of your competitors aren’t smart enough to see it. An Excel Template will be provided to help you capture these costs – and reduce them – going forward.