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Thursday, May 21, 2009

The General Contractor's Question: "What criteria do you use in determining which sub trade to use?" (2)

At the Ontario General Contractors' Association President's Panel last month, someone asked an important question: "What criteria do you use in determining which sub trade to use?"

Only Frank DeCaria, president of Eastern Construction Ltd. of Windsor and Toronto, had the opportunity to answer at the Symposium, but I think the question is important enough for me to see if the other general contractor panelists could provide their own direct answers.

Yesterday, Doug Burnside, president of Dolyn Developments in Ottawa, contributed this answer, which is worthy of careful review if you are a sub trade hoping to find work in the non-residential environment.

Here's my answer for the panel question you re-raised:

When tendering on a project in the traditional way, we General Contractors can certainly become real risk takers. We often receive our quotations very close to the closing time leaving us little or no time to properly evaluate them, read the fine print, or contact the trade firm to discuss it.

In a relatively small town like Ottawa we often know most of the trade firms that are sending us quotes and usually have a good sense of their competence.

The Sub-trades that we value most are those with whom we share mutual trust. They will provide their quote early enough that we can analyze it and discuss it with them, in turn, they can fully expect that their price will not be shopped to other trade firms. Without that trust, the bids come too late to analyze properly and a problem can ensue after closing, when there is a misunderstanding, hidden exclusion, scheduling
problem or a pure "walkaway" from a price.

When a price seems erroneous to us we endeavor to contact that bidder to discuss it, but if it comes 2 minutes before closing there is not much chance of remedy. Now we have to decide if we carry an excessively low quote or not, knowing that in all likelihood one or more of our competition will. If we don't, we will have wasted the time preparing the bid as we will likely now lose, if we do, we may well have a conflict. We truly do often face a "Catch 22" on many occasions.

When we have the luxury of inviting tenders under a Cost Plus or Design - Build methods of procurement, we can clearly spell out what is to be included; offer the opportunity to a bidder to withdraw a bid if it seems flawed; and invite those we know to be well suited to the project and proven and competent. Without conflicts, and better trade firms, we can better serve our clients.

Many of us have had a bad experiences carrying a trade that we do not know at a questionable value, resulting in one of the many possible perils. Alternatively, it is just this way that we sometimes meet those trades who become among our preferred.

....not for the faint of heart.
Subs looking for non-residential work should read this response carefully -- your chance of success is highest if you can put yourself in the mind-space of the general contractors with which you wish to work. Intelligent trust and allowing them some time to review your bid will save aggravation and give you the fairest chance of winning the work.

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