Builder Quotes - Do you trust them?
Would you truly trust any builder’s quote? That’s ok, no one ever does, and for good reason too.
Builders are famous for being sly. When it comes to quoting, even those few that have your best intentions at heart will have exclusions, conditions and missed scope items.
In this article I’d like to run through those reasons, and discuss what can be done to avoid getting burnt.
Dodgy Operators - The most common reason needs almost no explanation. There are plenty of dodgy operators out there. Your judgement of character often won’t sense anything wrong. They will be very professional, sweet and you will feel completely safe signing the contract.
However, soon after they start the build, you will be told that lots of “unexpected” and “missed” items were not covered in the quote for one reason or another. Often these builders have lots of Provisional Sums in the quote, meaning they are entitled under the contract to adjust those costs once the build starts.
It’s a Competition - An important fact to remember is that builders quoting, means builders competing for your business. Like any competition, not everyone plays fair. Even the honest builders find themselves in a pickle. For them it is obvious that if they are to include everything, they are certain to lose your business.
They fear (and often know with certainty) that someone else will use the typical tricks of exclusions, conditions and so on to present a price that on the surface looks like better value for money. They also know that you won’t understand, and most times won’t even notice these things.
That means all builders, whether honest or not, are forced down the same path of deceit.
Quote What? - The most common cause for exclusions and assumptions is not even the builders’ fault. Unfortunately they are often asked to quote on drawings that are lacking, designs unfinished, details missing investigations incomplete. This means they are forced to make assumptions. Here’s a simple example; If a bathroom tile isn’t specified the builders quoting have three choices:
Allow $100/m2 to supply the tile. Safe number considering the average cost is $40 - $60/m2.
Allow $20/m2 to supply the tile. Too low, and you will likely pay extra once the tile is chosen.
Exclude the tile.
To avoid losing your business they will either exclude the tile, or make an allowance that is too low and will result in a variation.
There are more reasons, but the result is inevitably the same. Most builds end up with cost blowouts (variations) in the order of 20% - 30%. Many suffer even more, over 50% is not unheard of. If you have built before, this won’t come as news to you. If you haven’t, simply speak to family and friends that have, but be ready for some horror stories.
Unfortunately, figures like this have become so commonplace, that they don’t really shock anyone in the industry. But, why not? Paying an extra 30% IS shocking! Why should that be commonplace?
Can these cost blowouts be minimised? Can you get builder quotes that you can trust? The short answer is: YES
The difference is that you won’t get a quote. It will be called a tender. What we do at RFT Consultancy to put a tender package together involves more steps than just sending builders a set of drawings and asking for a price.
As your Project Manager, we manage the design to make sure it is complete, all materials specified, all investigations done.
Over and above the design, we provide the builders with a detailed scope of work. A black on white write up of every item they must include, no ifs or buts!
They are also provided with returnable schedules, meaning every builder responds in the same uniform format and can be compared apples-for-apples.
What does all that achieve? Quite a lot…
The dodgy builders are left with no wiggle room for their tricks, exclusions and conditions.
The honest builders feel they can compete fairly, and stand a true chance of winning your business.
You get comparable quotes that you can trust. That means you can go for that cheaper price, knowing you won’t get burnt by variations in the long run.
There are many other aspects to controlling cost and minimising risk on a project. Book a free consultation to discuss how we can help you with your next build.
