Allowances = the Placeholders
The use of ALLOWANCES early on in the design phase is key to streamlining the schedule and remodeling process. Use of allowances provides the design, contract preparation and final pricing to proceed WITHOUT the homeowner having to first make ALL the decisions about items which will be incorporated into the project. For example, we can have an allowance for a Toilet of $300. And then build our process around that placeholder, perhaps months before the homeowner has to actually select the specific toilet to install. It works. BUT, it is crucial that the contractor uses and handles allowances responsibly, so that the allowance amounts accurately reflect the design intentions / finish levels represented by the homeowner. Otherwise, allowances can be very misleading and create unnecessary conflicts and surprises in budget.
Steve explains allowances in this video.