BIDDING VS. DESIGN BUILD

BIDDING VS. DESIGN BUILD

A few years back, a prospective client wanted to speak to a recommendation of mine while he was considering my firm and I gladly obliged.  The Recommendation:  A great client who is a true gentleman and also incredibly successful in the financial industry.  They spoke at length about myself and my firm and when they finished their chat – the prospective client called me and hired me on the spot.  I thanked him tremendously and inquired as to what it was that the recommending client said that helped him make the decision – as he was on the fence and conflicted between the traditional model and our Design/Build offering.  The recommending client shot back to the prospective client with this comment:  “In Lee, you have a guy who will develop a budget for the project with you before he ever starts swinging a hammer and once you are comfortable with this – he will stick to it like glue – what else could you ask for”.    The prospective client was horrified at the idea of not bidding out his project - but he later disclosed to me that the recommending client was spot on. 

 

What we were able to do wasn't really so incredible.  We simply took our experience, both in design and value engineering of a project  and developed a comprehensive design and contract price of about $1,400,000 – all transparent to the client.   At the conclusion of the project (on the exact day that we committed to in our contract one year previously) – the pricing had not a single TRH generated change order, not one surprise bill. 

And one last important fact:  The project was designed, built and completed through 2009 into 2010 – certainly the darkest days of our economy in our lifetime.

 

The point of the story is to understand what the bidding process can provide and what it never does – no matter what it looks like on paper.  If ones goal is to send their plans and specifications - drawn by one professional – out to a separate general contractor professional in the hopes that the collective elements will deliver the best price and most efficient project possible – that just never happens.  In reality, it never leads to a fixed price contract, never values or quantifies the amount of time that model just eats up in expenses to the client (carrying charges and interest expenses of multiple residences) and ultimately highlights the disconnect between the lack of building a team approach from the outset – a team with one layer of responsibility, one point for both the good and the bad.  The triangle of communication that results between the client, architect and contractor is rarely cohesive – and is hardly efficient on any level.  Because it’s a triangle by definition – not a straight line of responsibility. 

 

That is one of the main reasons why the traditional model is flawed. 

Cohesion and responsibility through a team, non-layered approach cannot exist in this approach and so ultimately, its just a question of when, not if, the disconnects end up costing the client money and more importantly – time.

 

Layers cost money that bidding can NEVER make up for.  Not to mention the lack of responsibility that comes with these layers.  Not to mention worrying about the financial stability of both the architectural firm and the general contracting firm.  Financial stability or more succinctly stated – making sure that the contractor isn't using the deposits for your project to pay the balances of the projects that came before you (and believe me, that happens all the time) – is a critical component in choosing a contractor (far more important than if they are the “low bid”).  Cash flow or the lack thereof also kills projects and doing your due diligence on both the architectural firm and the general contractor is so much more important that if the contractor is the low bidder.

 

Build a team first and keep the responsibility at one level. 

That has been The Renovated Home approach and model since 1990. 

Because it works.