BFC System for Success

Changing your approach when choosing a contractor

If you listen to the talking heads, they’ll be more than happy to inundate you with information about how to select a contractor. Many of the people you’re listening to have never worked in the construction industry! Wouldn’t you like to have a system that guarantees you the best job every time? Here’s how to do it.

Instead of soliciting bids, interview contractors.
If you ever solicit bids for work, you’ll notice something. Most of the quotes will be nearly the same and you might have a very high or a very low one or both. Consider this, everyone is going to have the exact same material cost for your project. What you want is someone you’re comfortable working with so instead of soliciting bids, conduct interviews. Ask for insurance certificates, contractor registration numbers, client references and pictures of previous jobs. Get an impression of who you might be working with.

Once the interview is over, check over the information you’ve been given. Call former customers and ask questions about how their project went. Check the Attorney General’s website and see what’s listed under their name and registration number. Talk things over, even conduct a second interview to ask questions that may have come up, and make a selection.

Go over your project in detail.
Now is the time to develop your project. Get as much laid out on paper as possible. When you can’t decide on a particular item, insert an allowance amount so that the quote isn’t held up. Use your contractor as a resource for product selections. He may have suppliers that he uses regularly and hopefully there’s a showroom that you can look and decide. It may take several hours, but get all the details ironed out. That includes your budget.

Right now you’re saying, “If I tell him my budget, he’ll just inflate the price to match.” Apparently you don’t consider yourself a very good judge of character, or you picked the wrong guy and know it. Besides, if you’re picking each product how can someone gouge you for it? The only numbers you aren’t privy to are the labor amount and the contractor’s markup. As we’ve already established, almost every contractor is about the same. The only true variable between contractors’ prices is the amount of their markup which is established by their overhead. Sharing your budget for the job allows your contractor to select the right grade of materials for your project. Instead of wasting your time with something too cheap or too expensive, he can show you exactly the items you are looking for.

Get a signed agreement.
At this point, your chosen contractor already has several hours invested in your project. Now is when you should be signing a Letter of Intent or a Design Agreement if not the actual contract. If you’re project is small, your contractor may be able to give you a total for the job right away and you can sign the contract and pay the deposit. Do not sign a Time and Material Contract unless you’re doing light repairs. If your contractor tries to get you to sign such an agreement, get ready to call the next guy. You want a lump sum price for the work to ensure you get what you pay for. If your project is larger, you should be prepared to pay a percentage of the budget for any further work. Compiling an estimate and doing all the preliminary design work is going to take at least a couple days if not more. You don’t go to work for free, don’t expect him to either.

Review the contract to make sure everything you want done is included. You’ll get to read various items that our legislators decided needed to be included, but concentrate on the specifics of your project. Get as much nailed down as possible. You’ll get an approximate start date for your project as well as an estimated completion date. If you’ve picked the right guy, you should be able to expect those dates to be extremely close, within a day or two. That is, of course, barring acts of God and changes to the project as it progresses. The entire purpose of all this preparation is to be able to hit the scheduled dates exactly. That is what “on time” means, and you should insist on it.

Avoid making unnecessary changes.
Sometimes unexpected things will come to light during construction. Other times you may decide that you want something a little different. Any time changes need to be made to the original contract, a Change Order needs to be executed. This is an addendum to the original contract which will include the items needing addressed, the adjusted contract amount, and adjusted completion date. Usually every change will extend the scheduled completion date and involve additional cost. Therefore, you want to avoid them as much as possible.

Get ready to enjoy the results.
Final payment will be due upon “substantial completion” of your work. That means there will be some small items that need to be done, but the area where the work occurred is usable at this point. You will be doing a walkthrough with the contractor to list anything that needs addressed. You should know at the completion of this walkthrough exactly when all those items will be completed. You should also receive a copy of this “Punch List” so that the items can be marked off as they are completed. Once the list is done, the project is done.

At this point you have just completed the project and you determined the price, no one else. If you chose the right contractor, everything was completed when it was supposed to be and you didn’t overpay because you decided what got used and that determined everything else. Now refer your contractor to your friends, family, and neighbors so they can enjoy the same experience you did.