Evaluating contractor quotes
Evaluating contractor quotes
Comparing contractors for projects can be a difficult task because the industry supplies intangible services. You cannot sample the experience of a plumber, painter or property consultant until you actually give them the order.
In contrast, evaluating tangible items like a battery drill, photocopier or lawnmower is much easier because you can see and touch them during the evaluation phase.
For this reason, purchasers often make the mistake of evaluating based on the one seemingly tangible factor- price. Human nature is that we seek to back our decisions with logical facts, however in doing this we are often overlooking many key factors and in turn, making poor long term choices. While initial price is important, it quickly reduces in importance when other factors are not met.
Below is a few points to start with;
Quote price or final price?
Managing project cost over runs are a major part of Project Management training these days however they still seem to occur. One of the key reasons for this is unscrupulous contractors openly using the ‘cheapest on the day’ mentality which wins them the project, only to have the variations and extras start rolling in shortly afterwards. No longer is the client getting the cheapest price- they are getting the most uncertain price.
Speed and timeframes?
Ever had that cheap contractor that couldn’t give you a start date for 3 months? And when the day finally dawned he didn’t turn up? Having your rebrand project run 5 months late or your school repaint overflow into the term can impact on your operation. Perhaps on your own home you may be a bit tolerant but in most commercial situations timeframes are a very important consideration.
So what about safety?
With the new H&S laws come into effect, MBIE is threatening to impose huge fines, and even imprisonment for stakeholders that shirk their responsibilities. But the most important part of the new changes is they have widened the net to place responsibility on individuals at all levels of the organisation. So if you are a director, board member or any person involved with contractor engagement, using companies with living H&S systems is much more important than price.
Any other factors?
It doesn’t just stop there. Other factors to weigh up include what is the image of your contractors like? Do they enhance your company brand? What is the lifespan of the work done? Whats their commitment to defects and remedials? Will they be around in 2 years time? Will they sub the work out to another unknown company? All these factors need to be considered when comparing services.
