Choosing a Contractor - Assessing Costs

Having developed a basic set of plans for construction, the inevitable first question is: can I afford this? Most clients would like to have at least a basic understanding of what the costs of a certain piece of work would look like, before going too deep into the design process. There are two general approaches to getting cost estimates. One approach is to get bids on a full and comprehensive set of drawings, analyze those bids, and arrive at a fair price for the work. Assuming the bids are equivalent ( “apples to apples” ), a client could choose a contractor based on price. A second approach is to interview a number of contractors, check references, and request a preliminary price structure based on a preliminary set of plans. In this approach a contractor is chosen before the pricing is completed. That contractor then helps to develop an affordable, workable scope. This approach is usually referred to as a negotiated bid.

Of course, the advantage of a true bid is that it supposedly limits the costs of a project, and can reveal the relative cost structures of different contractors. Unfortunately, that is only possible if you have had the time to create a really comprehensive set of plans and specifications for the project. Without that preparation, there is no guarantee that bids are not missing pieces that would be necessary to the completion of the project. True comparison becomes difficult.  In our experience, it can work out well to choose a contractor to work with relatively early in the design process, and then work cooperatively with that contractor and the designer to build a scope, a budget, and a schedule, all of which fit the client’s needs. With the cooperative work of the builder, the plans that are developed remain within the constraints most appropriate to the client.