Why the lowest bid is not always the best bid

Written By:  Janet Bussell-Eriksson
Bussell Interiors    www.BussellInteriorsInPrescott.com
Bussell | Eriksson Designer Homes & Renovation, LLC.  www.BeDesignerHomes.com           

It has been years since we’ve seen such a down turn in our economy and I personally don’t know a single individual who has not been affected in one manner or another.  I think those of us in the construction and design industry would say we were some of the first to experience this recession. 

I have noticed an increase in renovation projects since the beginning of the year and there are several new custom homes in the area that are under construction and what appears to be lots of commercial development so hopefully we are witnessing the light at the end of the tunnel.

Competition for projects/jobs is tough and to coin a phrase “everyone is hungry”.  With this being said, homeowners or businesses who are looking to begin a project should keep in mind that the lowest bid is not always the best bid.  There are many things you need to consider when obtaining bids and some of the basics are:

         Does the bid cover the entire scope of work?

         Is the bid an estimate or in written contract form?

         Is there a timeline as to how long the work will take?

         When comparing one bid to another are the items the same? {apples to apples}

         Are there exclusions, possible extras or “nic” items? {“nic” = not included in contract}

         Is the contractor/sub licensed & insured; are they local?

         Have you seen their work & checked references? 

A key item to remember when bidding a project is that unlicensed, inexperienced, and uninsured labor at below standard wages will probably take three to two times longer to accomplish the project you hire them to do.   If you are basing your “savings” on hourly wages the “bargain” is not a deal by the end of the job as a skilled trade who charges a little more would get the job completed faster and in the end cost Less money.

Workers who accept “bargain” wages usually require more supervision, management and detailed instructions.  You are essentially providing “on the job” training for unskilled labor.   If this is the path you begin to follow you need to ask yourself; Is it your intention to renovate & build or to manage and train unskilled, uninsured, inexperienced and unlicensed labor?

Manpower and even companies such as “labor express” charge a minimum of $12.50 an hour for their unskilled labor – these companies have a labor pool based upon workers who just show up when they need work.  It is not a reliable resource for quality installations; craftsmen or quality work – they are simply a great resource for unskilled day labor designated to do simple tasks which still need to be supervised.

Skilled, licensed, experienced and insured trades will get the job done in the time they commit to; they will provide you with all of the anticipated costs up front; they will supply and provide all of their own tools and materials in order to get the job accomplished.  They will warrant and stand behind their work.  If something should go wrong with their work then there is a manner of recourse either through their insurance Company or licensing bond.

My advice to you when you go looking for that “bargin” is to simply ask yourself; “are you looking to have your job performed in a professional manner by a skilled, experienced & licensed trade or by an individual who is uninsured who you have to monitor, instruct and follow up with step by step?

One of the most talented wall covering and faux finishing contractors I’ve worked with right here in Prescott has this saying printed on his business card:

The cost & inconvenience of poor quality lingers long after the thrill of a bargain is forgotten”

I think these are words everyone should remember and live by and certainly keep in mind while they are bidding their projects.