When I started my first position as a fresh faced interior designer 15 years ago, the construction for all of our projects were tendered. Then, as the economy improved, clients moved towards the attitude of ‘I just want it done’ leading to the Design/Construct model.
Fair enough.
However, I’ve always wondered ‘why wouldn’t you get more than one quote…?’ Why would you be dictated to by one builder? After all, I tend to check out prices from two or three different shops when spending $1000 – surely you’d do the same if you were investing a couple hundred thousand (often more)…?
However, things have changed. People are a lot more cautious since the GFC hit. We recommend going through a tender process for 90% of our projects. After all, you still need to wait for one price, it doesn’t take any longer to get three.
But what does that actually mean? How should a tender work?
Here are a couple of things to consider:
1. Get three or four different builders to tender – more than that gets a bit unweildy.
2. Ensure that the builders are independant of your designer/architect to prevent any ‘topping up’ of design fees within the construction contract. The designer should be your (the Clients) advocate, not being dictated to by the builder.
3. Ensure the builders are independant of each other to prevent collusion. In small niche markets builders often get quotes from the same subcontractor, but they often get quotes from a number of subcontractors to ensure they prices are competitive.
4. You should be advised how your tender will be run and what the person running the tender will do during the process.
5. We recommend that each builder organise a meeting onsite with all his subcontractors during the tender period – this is a good opportunity for our Clients to meet each builder and see them in action (ie how they deal with their subcontractors, know the project, understand the site etc). As much as the final price is important it is also essential that you are comfortable with the builder.
6. The tenders should all be submitted by a certain time (again to prevent collusion) and should be sent to both you (the Client) and whoever is running the tender (ie the designer) at the same time. We generally try to schedule a meeting with our Client soon after the tenders are submitted to run through each price and any queries or concerns.
7. After the tender it is important to remember that some negotiations may still be required and you may choose to discuss these options with (we recommend) two of your preferred builders.
8. You must feel comfortable with your decision and not forced or frightened into signing up with a particular builder.
So, that’s it in a nut shell! Would love to hear your thoughts on the whole process – feel free to comment or if you prefer, send me an email…!
