• Duane C. Barney

It comes down to price

Clients want the best price, we all do, so when it comes to sending a project out to bid contractors are pushed into an interesting dilemma. Do we tell the client what they want to hear or what it will cost? Most small projects do not come with a full set of architectural plans, so the scope of work is a lot of hand waving and question answering. Each contractor asking different questions and hearing different answers. Even with plans, many selections remain undecided yet the client needs a price in order to finalize decisions, Chicken, and the egg. With a lot of variables comes a lot of guessing and pricing options.

Since the client’s focus is all on price and less on the scope we as contractors have to decide. Give the client a low price, get the job and deal with changes down the road or be honest, lose the job and be satisfied in knowing what the project will really end up costing. No money in the bank only satisfaction. The industry outfall of this is “good pricing but he change-ordered me to death” unknowingly this is what the client asked for, or at a minimum that is the perception they broadcast to the contractors, It comes down to price. I have bid on projects where I have never met the client, only the architect. I have no opportunity to distinguish the company or the services we provide, so the message is price, not service, a Tough place to be when you are in a service industry of custom construction. Yes, even your remodeled bathroom is custom construction, only built once and to your specifications. It is all custom, a service not a commodity.

I have tried to guide clients through this process but they either “already know what they are doing”, don’t want to listen or think builders are trying to rip them off at the outset.

If you want your project to go exceedingly well, get to know the contractors you are asking to bid, understand how they do business and what you can expect. Provide as much information as possible even if you have to guess, you can change your mind later. By providing a clear scope you will have a reasonable shot at receiving pricing that is comparable with the expectation of the project outcome.

Not all builders are the same, there is no industry standard as to how we prepare estimates or submit proposals, I have honestly seen $100,000 projects on a napkin agreement. It went bad, really bad, and I came in to clean it up. If you’re a client anticipating a project, expect it to take a lot of your time, you are starting a small business and it will take the same effort and diligence for it to be a success.

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