Building Subcontractors – Bids 

 

Tips For Subcontractor Bids – What to expect

I once had a subcontractor give me a labor and material bid for $6500.  I told him that I would think about it and let him know.

I wasn’t really thinking about it because the bid was too high.  Four hours later, the same sub called back, announcing that he’d had a “change in his schedule” and could get started on my job right away for only $5000. 

I hired him.

I didn’t believe that he’d really had a “change in schedule.”  

He did what contractors sometimes do, throw a really big number out there and see if someone bites.

That is why multiple bids are essential.

It’s not uncommon to have a 25% difference  between high and low bids for the same job.

 

 

There are general contractors and subcontractors who always charge premium prices and get away with it because people let them.  

Even general contractors sometimes pay subcontractors too much because they get lazy or get in a hurry.  There’s no reason that should happen to you.  It’s easy, in fact, to get it right.

Nevertheless, I don’t necessarily hire the cheapest subcontractor.  I hire the cheapest good  subcontractor.  I don’t mind paying a little more for a sub I’m comfortable with because I know that his work is top quality.

If there is a sub that you really want to hire, but don’t like his price, then talk about it.  A little bit of negotiating can save you money ─ a lot of money when the principle is applied over the entire course of construction among a dozen or so subcontractors.

He may not lower his price, but it certainly can’t hurt to ask.

It is likely at some point in construction you’ll find a sub with the lowest price, that you want to hire, but isn’t available for a week or two.

You don’t want to pay more than you have to, but you don’t want to waste time either.

If I have that choice between two good subs, I usually choose the one who can start right away, even if he’s higher priced ─ as long as he’s not too much higher priced.

It’s a judgment call.  Don’t forget that you’re paying interest everyday on your construction loan.

 

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