Last month, on our Commercial Project journey, we looked at how to ensure an effective an accurate quoting process.

This month, we’re moving on to Step 6 on our ‘Roadmap to success’ for commercial projects.

 

STEP 6: COMPARING THE QUOTES

Once you have received your quotes, it’s time to compare them and choose the best fit for your job. It is important to remember that the cheapest is not always the best value, but neither is the dearest necessarily. Here is what you should look for when comparing quotes.

Look for price variations

All the quotes should be similar, falling within a 10-15% range of each other. If you have one (or two) that are vastly different to the others, it is likely that something is wrong, they don’t really want the work, or they are inexperienced in the type of work you have. Dig deeper and see if it is just one or two items that stand out as inconsistent compared to the other quotes.

.

Beware of allowances

Check whether allowances are listed in the quote. Key words to look for are “budgets”, “provisional sums” and “prime cost allowances”. These allow the builder to change the contracted price based on costs determined later.

Ideally you should avoid allowances, which is easier if you are better prepared for the project. If they cannot be avoided, try to negotiate the same allowance amount for each quote so they can be more accurately compared.

Exclusions

Each quote should be clear on what is not included, normally listed under an exclusions section. However, just because something is excluded, this doesn’t mean it is not required. If in doubt, ask why it was excluded and obtain a quote to cover the cost of the excluded items if needed.

Length of contract

Check when each quoting builder can start and the length of the contract each builder has indicated. As with the price, if one quote has a vastly longer or shorter period that the others, there might be something wrong. If timing is important to you, pay close attention to the length of the contract.

Interview the best candidate again

When you have chosen your preferred builder (or top two), invite the builder/s in for an interview or a conversation. This is your opportunity to clear up any concerns you may have and provide a platform for questions from both sides. Questions we recommend that you ask include the following.

• What are their concerns?
• What other costs am I likely to incur?
• Are you able to provide any references? (Doing this is more common than you think. It should be a red flag if a builder can’t produce references from previous comparable jobs.)

 

Next month, we’ll talk you through how to approach signing on the dotted line (that is, contracting) with your chosen builder. In the meantime, don’t be afraid to reach out to us with any queries.

You can find us at:

Head Office (AU)
7/121 Newmarket Road
Windsor QLD 4030
www.core4service.com.au
hello@core4service.com
1300 267 333