Recently, at a local trade show, I taught a seminar on tendering construction projects. The purpose of the seminar was to help building owners and property managers choose the right contractor for their construction projects. In other words how do you hire a firm that can deliver on all your needs not just price and quality?
Part 1: Identify the Red Flags
One of the keys to tendering a project successfully is to eliminate the construction firms that cannot deliver on your needs. How do you do that? How do you rank contractors before they have done the job?
Here are three “Red Flags” that can help you separate the good from bad:
If contractor calls with multiple questions after the job walk, they do not communicate well and they will have a hard time meeting your specific needs.
If they can’t bid accordingly and submit their proposal “off” scope they are not organized enough to handle your project professionally.
If the start and finish dates seem unrealistic, they probably are. You probably are dealing with a contractor that tends to overpromise and miss on service commitments.
Don’t take these mistakes lightly. The submittal process is the easiest part of a construction project. If your potential contractor can’t listen and seems to be overpromising, eliminate him or her from the process. By doing so, you will save some serious headaches down the road.
Part 2: Setting Expectations
One of the keys to a successful construction project is setting the correct expectations with your contractor. With potential employees you set expectations during the job interview and with potential contractors you set expectations during job tender. Get your service expectations on the table early and you will avoid a lot of conflict with your contractor down the road.
Here are three key expectations to set during the tendering (bidding) process:
Submittal dates for tender closing
Set a firm deadline for contractors to submit their quote. By doing, you will avoid having chasing down the contractors for their proposal. Two weeks is ample time for a contractor to prepare his bid and submit. If a firm misses the deadline, eliminate them from the process
Deadline for start and finish
Construction projects are notorious for dragging on and on. Nip this one in the bud, by giving your contractors a deadline for starting and finishing the job. Discuss the deadlines with your contractors during the tender process and settle on a realistic timeframe. If a contractor can’t make the deadline don’t hire them.
Your unique requirements
Do you have specific tenant concerns that your contractor needs to be aware of? Does your contractor need to coordinate with other trades on your site? Do you have specific work schedules or security procedures that need to be followed? What ever your specific needs are, table them during the tendering process to avoid frustration down the road.
Set the right expectations early in the process and you are well on your way to hiring the right contractor for your job and in the end, a successful construction project.
Part 3: Classic Mistakes
Since our inception in 2004, Wolfgang Commercial Painters has been involved in over three thousand construction tenders. Many of the projects were tendered effectively and some were not. Projects that are tendered ineffectively start off on the wrong and inevitably go over budget. Here are the “classic mistakes” that we have seen repeated over and over:
1. No job walk
Contractors are met on site to review the project individually (if at all) as opposed to a group walkthrough. Resulting in a scheduling nightmare for the property manager or building owner and scope confusion.
2. Jobs tendered to late in the season
You will get your best price if you tender a project in the winter. Tender in late spring or summer and you will pay more.
3. No deadline set for submission
Contractors are left to submit their proposal at leisure. Drags out the tender process. Jobs end up being awarded in peak season when capacity is lower and in the end the jobs take too long.
If you are about to tender a construction project avoid the aforementioned mistakes and you are well on your way to a successful project!
Part 4: The Job Walk
One of the keys to a successful construction tender (request for bids) is an effective job walk. More often than not contractors are asked to view a potential site on their own without a project manager to explain the details of the job. Asking contractors to view the site independently may seem the like easiest route to receiving proposal? But, without a proper job walk you will get large spreads in pricing because contractors will inevitably bid on different scopes of work. Scope confusion and varying pricing, doesn’t sound effective? Avoid the headache, invest a little time and conduct a proper walk with your potential contractors.
Here are some tips:
1. Schedule a specific time for the job walk. You will not need more than one hour. Invite all four contractors to attend at the same time.
2. Use email to invite, it is easier than phoning. Request confirmation of attendance from the contractors via email.
3. Invite four contractors, so if one doesn’t show, you are covered.
4. Hand out your tender package to each contractor based on your budget quote. Review the basic specification and scope, your areas of includes and excludes and the submittal deadlines.
5. Set the key expectations: Submittal dates (two weeks), time frame (deadline for start and finish) and any unique requirements.
6. Walk the entire site with the group. Encourage clarifying questions. Now is the time to answer questions and get the entire group on the same page.
7. Red Flag: If a contractor calls with multiple questions after the job walk, it is a red flag that they do not communicate well and they will have a hard time meeting your specific needs throughout the job.
8. If an important change in scope occurs at the job walk send out an addendum to all bidders via email to keep everyone on the same page.
There you go, a few simple steps to achieving an effective job walk.