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The Custom Residential Architects Network (CRAN®) Knowledge Community develops knowledge and information to benefit architects who are engaged in, or who are interested in learning more about, custom residential practice. CRAN® presents information and facilitates the exchange of knowledge and expertise to promote the professional development of its members via discussion forums, national symposia and conventions, publications, and local activities.

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  • 1.  Bid request format

    Posted 09-04-2019 08:33 AM

    I am about to send a residential addition project out for bid and I am reviewing my standard bid request letter.  I would like to update it.  Is anyone willing to share a bid process, outline or format that you use that you find successful?  My biggest concern if that I often get bids that are not "apples to apples" and it takes me a lot of time to compare them fairly and equally.

     

    Thanks in advance for any advice.

     

    Stephanie Sola-Sole

    SOLA-SOLE ARCHITECTS LLC

    e:  stephanie@solasolearch.com

     

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  • 2.  RE: Bid request format

    Posted 09-05-2019 05:48 PM
    Hi Stephanie, interesting concern. As a Remodeling Contractor / Architect, I find that most Architects have difficulty in this area.
    To compare Apple-to Apples, I would prepare a written scope of work (SOW), which could be in the cover page of the plans or as an addendum along with specifications. Said SOW should have a general description of the work to be done, quality expected, specifications and requirements for the trades (which can also be a separate request for qualifications (RFQ), then have the entire work broken down in CSI MasterFormat divisions. Your bid request should refer to these documents and require that a schedule of values (SOV) be provided with pricing for each item. You may provide numbers for allowances, if you have made these decisions with the Owner, or indicate that these need further design and coordination with Owner.
    You would need to stipulate what kind of contract will the awarded contract be bound to (lump-sum, percentage with GMP, etc.)
    In real life, Residential Architects often relinquish these duties; The contractor is handed the control of the project and the Architect is pushed to a position of lesser importance, to review submittals and answer RFI's. Very happy to know you are not one of them!
    It is also often the case, that the Owner has decided on a contractor, way ahead of the bid process, and will use the bid process just to check and give an advantage to the pre-selected one. this is the main reason I do not believe in competitive bidding for residential projects. The Owner, not the Architect, controls the bid.
    If your fees allow, I recommend finding expert help.
    Good Luck!

    ------------------------------
    Ivan Contreras, LEED AP, AIA
    Qualifier | Director
    CONTRERAS MUNOZ & CO
    Miami FL
    ------------------------------

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  • 3.  RE: Bid request format

    Posted 09-05-2019 06:21 PM
    Here's my approach:

    1.  Proper construction budget with 5%+ client contingency held closely.

    2.  A coordinated lump sum/fixed price construction contract with a defined duration, liquidated damages, and very few alternates and zero allowances. It takes full service documentation to get this far, but that's what they hire me for and it removes cost increases from unknowns during construction. The contingency then is for actual unexpected discoveries, not imprecise pricing.

    3.  A thorough 01 General Requirements specification section. It details work restrictions and access, behavior, temporary utilities, alternates (minimal), communications and project management, submittals, QA/QC, permitting, temporary facilities and controls (contractor provided toilet and dumpster), protections, parking, security, fire extinguishers, construction signage, execution and closeout. For contractors that balk at a dozen pages of basic project expectations, they've auto-selected themselves off the list. But good contractors prefer having this all spelled out because they typically have most of it figured into their process to satisfy clients anyway. And then they don't have to compete with lowball contractors that omit these to win only to change order them back into the contract on top of their unrealistically low initial price. (Examples: "I never figured in a dumpster or disposal, that's on the owner", "we don't do final cleaning", "this _____ expense/fee is not included in the contract", "we didn't include silt fencing or tree protection", etc.)

    4.  Then the bid request letter is nothing more than a pointer to documents, a proposal due date, and offer for an initial meeting.

    I should clarify that in our busy local market, I never bid in favor of directly selecting one contractor to submit a price based on qualifications. In a heated economy, our residential market doesn't support efficient pricing in a competitive situation because contractors don't want to look at projects selecting them by price. They'll submit a number, but it will be 30%–50% higher to off-set their risks of missing requirements not discovered in a minimal review of the documents. The exception is if you pay them to bid, maybe $5k. But why not simply start with whoever you'd like to build it if they are interested?

    Hope that helps.

    ------------------------------
    Steve Hall AIA
    Owner
    Steve Hall Architecture
    Cary NC
    ------------------------------

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  • 4.  RE: Bid request format

    Posted 09-05-2019 07:46 PM
    We give the GCs the exact spreadsheet that we insist be used to categorize the bid amounts.  But even then, one GC may still categorize differently than another.  Then we follow up with a phone call and ask directly what is included in each number.

    Rebecca Calbert, AIA
    Calbert Design Group, LLC
    678-398-7744



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  • 5.  RE: Bid request format

    Posted 09-06-2019 09:11 AM

    It's possible that you are going about this the wrong way.  I have some suggestions:

    If you are attempting to collect true "apples-to-apples" comparison bids, then you would have to provide the bid format - not just a bid request letter.  You would have to determine the categories and breakdowns, and ask them to be filled in, as a form.  But, I don't know of any residential contractor who would agree to that.

    The bid information you receive from each contractor - even though you find that you can't cross-compare - carries plenty of information about the contractor.  They way they format something, and the level of information they are willing to share tells a story about them.  And, that's half the reason to get bids in the first place.  You might consider that "apples-to-apples" comparisons are a goal too far, and not entirely important.

    When you say you're trying to compare the bids fairly and equally, you can only mean the relationship of price.  And, in my experience, if price is the only consideration for a project, then the client can never be satisfied.  There will always be some other builder who could give you a lower price.  There will always be "two guys and a pickup truck".  That is called a race to the bottom.  Everyone loses - including you.

    I think price should be the second-most important consideration.  The most important should be the client's relationship with the contractor.  When they are about to spend a large amount of money to have someone come into their home, tear it up, and put it back together again, they have to strongly consider the relationship with the person doing the work.  There will be problems.  There will be conflict.  You can't risk a client's home - and your reputation - based on the low bid.  Your first consideration should be for a contractor with a long history of successful projects, and happy former clients.  This is someone with a vested interest in customer service and completion.

    Finally, when you talk about comparing bids, it sounds like you're working with a completed/finalized set of construction documents.  I suggest that you consider a process whereby you can obtain budget/ballpark pricing from contractors, after the schematic stage.  The worst time to find out pricing is when the drawings are already completed.  In my experience, there are always revisions when clients get their pricing.  If this happens after the drawings are completed, you will have to charge for revising.  And, the client will wonder why you didn't know the pricing would be so high - as if somehow it's your fault.

    I wish you the best of success with your projects.



    ------------------------------
    Robert Braddock AIA
    Principal
    Red House Architects, PLLC
    Arlington VA
    ------------------------------

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  • 6.  RE: Bid request format

    Posted 09-09-2019 05:27 PM

     

    Robert,

    That is the most comprehensive and best advice that I have heard in a long, long time.

    Lewis Faulkner, AIA

    Plano, Texas

    Formerly NOVA




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  • 7.  RE: Bid request format

    Posted 09-18-2019 10:44 AM
    I agree with the prior comments.  We have found bidding not helpful generally in residential construction but we have found a way to use it to fend off spikes in building material cost.   We use bidding to give us a snapshot of where we are with budget at the end of Design Development.  What I inform our clients that our drawings are comprehensive enough in the end that the building materials cost vary only about 3 percent.  So we find out what the contractors mark up will be and how they handle it.   So we provide a schedule of values with an outline specification.  We have made appliance and plumbing selections with the client.  Then our contractors can give us a conservative ballpark number.  Then the client sees how the contractor presents the numbers to them.   We generally sit down with all three builders, get tours of homes then let them present the numbers.  The schedule of values allows us to see the costs of different components of the project. The client then chooses one builder to move forward and we can then go into construction document phase knowing which materials to detail.  Once we started this process we found the price increases due to labor or materials can be dealt with early and not at the very end where we will have change many sheets of drawings.

    ------------------------------
    Christopher Rose AIA, ASID
    President
    Christopher Rose Architects, P.A.
    Johns Island SC
    ------------------------------

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  • 8.  RE: Bid request format

    Posted 09-09-2019 06:35 PM
    I have a slightly different take. Personally, in a bid situation, I think that all bidding contractors should be researched enough that your client feels comfortable with any of the bidders doing the project. If not, they shouldn't be allowed to bid in the first place. A competitive bid situation should be essentially saying, "if you've got the lowest price, then we'll pick you." (Assuming that start and completion times are acceptable.) Otherwise, a bid process just to keep the already-favored contractor "honest" is deceptive and unethical, IMO. (If the relationship is the most important factor, then a negotiated contract works better, which I prefer anyway.)

    You shouldn't have to spend time analyzing the bids to figure out what is an apples-to-apples comparison; this is a sign that either the documents are incomplete, that you have allowed a breakdown, or worse, a recapitulation of the work (like the attached page), to be included. Exclusions or contractor-determined allowances are usually just laziness on the part of the contractor, and should not be allowed. (YOU should set any allowances, which should be used by all bidders.) While a breakdown (schedule of values) is useful for evaluating payments during construction, I don't really see what they add to a bid. Knowing that one contractor has included $21,000 for rough framing, and another has $19,500, is going to tell you what? How do you compare one contractor who bills laborers out at $75 per hour with a 5% OH&P with one who bills them out at $55/hour with a 15% OH&P? 

    If the low bid is really out of whack, though, then the low bidder should be given an opportunity to review the bid for completeness before disclosing any bid results. 

    There are many reasons a bid could be significantly lower than another, completely unrelated to quality. For example, more shopping of the subcontractors, better discount at supply house, lower overhead, urgency to get the project, desire to get established in a neighborhood, particular efficiency and knowledge in a project size/type, etc. If the contractors have been fully vetted, NOT going with the lowest bid is just throwing money away, and the low bidder -- who may have worked his/her butt off to get the price down to the bone -- has every right to feel cheated if not awarded the contract. Just my opinion. You may find some useful verbiage in the attached bid instructions.

    ------------------------------
    Richard Morrison, AIA
    Architect-Interior Designer
    Redwood City, CA
    www.richardmorrison.com
    ------------------------------

    Attachment(s)

    pdf
    Bid Instructions.pdf   29 KB 1 version
    pdf
    Recapitulation-1.pdf   42 KB 1 version
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  • 9.  RE: Bid request format

    Posted 09-11-2019 03:26 PM
    That's an excellent response by Richard Morrison.  

    In my opinion, picking the contractor by cost is a recipe for failure.  The client will lose in the end by either inferior quality or schedule or both.  I'd say that 99% of our residential projects, the client seeks our recommendation for a contractor.  It is completely about the relationship and confidence that a trusted partner provides.  I also agree that a negotiated bid or cost-plus works best imo.  I can't recall a residential project that the scope has not changed to some degree during the project. We are fully committed to coaching our clients through the very personal process of a project.

    ------------------------------
    Gregory Holah, NCARB
    Architect
    HOLAH Design + Architecture
    Portland, Oregon 97232
    ------------------------------

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