Men of Steel
Vince Bailey / May 2020
“Breaking up is hard to do…”—Neil Sedaka
I often think we subcontractors are a bunch of chumps regarding our relationships with our general contractor clients. For decades, our favored GC friends have encouraged us to broaden our scopes and offer complementary services in our commercial drywall proposals. And it does make good sense for us to do so for a number of reasons. Coordination of scheduling, scope overlap, commonality in work force skills, reduction of inter-trade frictions are just a few advantages of a multiple-scope approach for subcontractors. And of course it’s not for our own benefit that GCs boost the practice of combination proposals. They value the ability to write one contract, pay one monthly billing, and deal with one face during the performance of a project. It sure beats getting bogged down with a whole bunch of haggling specialty contractors who often create gaps between their stated scopes. And let’s not forget to mention the cost reduction that bundling can offer our GC counterparts with overlapping work. Consequently, we compliant commercial drywall subs have offered an additional number of related scopes such as paint, plaster (EIFS), ACT, insulation and caulk to our basic framing and drywall package as a mutual administrative and cost benefit.
And so it leaves me somewhere between aghast and agog when a GC contacts me about a recent proposal and wants to know if I’d be willing to perform one of the ancillary scopes under a stand-alone contract. And just to add insult to injury, I’m asked to do it for the breakout price I quoted as part of the combination proposal. This kind of cherry-picking on the part of the GC counters one of the prime qualifications I state in bold on every one of my combination proposals: “Pricing is based on award of all scopes combined. Breakout pricing is for accounting purposes only.” A similar reluctance among most bidmeisters to break up supplementary scopes to perform stand-alone can be attributed to any combination of several elements, including cost, scheduling, distribution and personnel.
One of the main attractions for a subcontractor to adopt complementary scopes in the first place arises from cost savings due to overlap of work. An excellent example of this emerges between drywall finishing and painting. In my experience, many drywall companies prefer to use a high-build primer in lieu of using a skim coat of mud to achieve a Level 5 finish. With regard to paint, most spec books require a prime coat and two finish coats of paint over drywall. But if I am going to perform the drywall finishing, I can offer a very competitive paint number by eliminating the prime coat that I’ve already covered in my drywall scope. It’s easy to see that the downside of this is that my low paint number is attractive to the GC as a stand-alone, but I can’t perform the paint at that number unless I also perform the drywall.
Another advantage of bundling scopes comes with sequence and scheduling of manpower. The scheduling benefit for a drywall sub to include batt insulation with his drywall proposal, for instance, is significant. The usual board-hanging sequence (i.e., one-siding the framing and waiting for an inspection before insulating and second-siding) makes calling out a separate insulating sub for less than a day’s work to keep hangers working inefficient at best, when drywallers are already on site to quickly stuff the cavities and finish their hanging in one fell swoop. A similar scheduling advantage exists between the drywall hangers and fire/sound caulkers, and between finishers and painters as well.
Distribution of supplemental costs across scopes can be tricky, and can present an additional drawback to breaking up a combination bid. Of course, cleanup and supervision should be added to each proposed scope on a pro-rata basis. But a bidmeister caught up in deadline anxiety looks for shortcuts and may resort to adding significant contingency costs to the main drywall scope in haste. And so costs like parking (which can be substantial in a congested city environment), mockup, per diem, tax (when applicable), shipping, hauling, job trailer and full-time safety officer are all contingent job expenses that tend to adhere disproportionately to the framing/drywall portion of the estimate.
Another factor to consider when bundling scopes involves the makeup of in-house personnel—that is to say, skill sets matter. While many framing/drywall mechanics are multi-skilled, specialty trades require unique skills that adhere strictly to their trade. And so a framing/drywall contractor who proposes to perform multiple scopes is compelled to procure enough of the ancillary work to maintain a core crew of skilled tradesmen.
For these stated reasons, my reluctance to allow a GC to treat my combination proposal like a smorgasbord is understandable. Cherry-picking is highly objectionable in my view. After all, breaking up a bundled bid is hard to do.
Vince Bailey is an estimator/project manager working in the Phoenix area.