At the risk of offending several of my esteemed superiors, I am now prepared to address the delicate topic of general contractors (GCs). I use the word “delicate” in reference to the questionable notion often shared by my upper management counterparts that GCs are somehow beyond reproach.
As middle managers, we estimators are often assigned to the dubious task of defending our leaders’ best interests despite themselves. I doubt if we can even count the number of times we’ve been admonished concerning the thrones’ sacred motto, “the customer is always right”—the “customer” being the GC, of course.
This, in the face of an onslaught of underhanded or surreptitious assaults on our organizational integrity by backstabbing “customers.” What our vaunted colleagues seem to have overlooked is an essential maxim that battle-scarred estimators and other middle managers are constantly reminded of: that general contractors and so-called subordinate subcontractors are regularly competing for a limited resource (the profit!), and the relationship is therefore fundamentally adversarial. But of course, we estimators are “team players,” and so we dutifully hold our collective breath and tiptoe through the minefield of the GCs’ bag of tricks.
The many mind games that GCs try to play on specialty contractors seem endless, but I am prone to sharing just a couple of common jewels. They involve additional cost for loosely related “complementary” scope superficially tacked on to the original proposal, and insistence that questionable items, not specifically stated, are implied and therefore inherently attached to the proposal.
The first instance refers to a scenario in which the GC benevolently offers the favor of allowing the estimator an opportunity to include a significant portion of work that falls outside the usual commercial drywall scope. Of course, the mere terms “favor” and “opportunity” associated with a general contractor should set off alarms.
Their request should be about as inviting as a feast of peanut butter-and-crackers on a desert hike in June. Unfortunately, this thinly veiled ruse too often beguiles a naïve specialty contractor, especially one entangled in a pre-award situation that may seem like it hinges on a make-or-break deal. But hard-won experience allows a clever “bidmeister” to pierce the GC’s devious façade.
The general contractor’s continued persistence belies a covert sense of desperation on their part: they apparently harbor a deficiency in their own contract regarding some specialty item with which they have little familiarity and/or they have exhausted a list of reliable specialty contractors. They urgently need a specialty contractor to fill a gaping hole in their buyout. The GC will attempt to fill this vacuum by firmly suggesting that this specialty item is somehow contiguous with the drywall scope.
This loosely related element might involve such significant items as ornamental precast trims, building expansion joints, wall protection (corner guards, crash rails, Acrovyn), fabric ceilings, structural steel, ornamental iron, wall coverings, acoustic wall panels, flashings, thermal insulation or decorative caulk. The list of possibilities extends infinitely.
Clearly, this situation can be resolved with the specialty’s estimator either graciously declining or submitting an inflated price—one that generously allows for an entire world of potential risk.
The second instance involves a related situation in which the GC confronts you, the estimator, with a potential gap in your proposal. This one requires some serious navigation. Keep in mind, many GCs are quite adept at seducing a inexperienced specialty into accepting some rather nebulous “informal” agreements that are usually neither incidental nor insignificant.
The approach under which the GC will suggest you have allowed scope items that you haven’t specified will be friendly in tone. They will probably call you on the phone, and along with some casual small talk, they’ll insert the seemingly innocuous question: Oh, just incidentally, you did include (item x) in your number, right?
From this, the GC hopes you will infer that the competition has carried x in the base bid, and this could be a deal-breaker. Moreover, you don’t want to look stupid. After all, x is an item you now assume to have missed and should have had it covered if your competitor included it.
So, what’s it going to be—save face and surrender a chunk of your margin in the name of good customer relations, or stand your ground, admit you didn’t have x included, and request the additional cost you are entitled to, perhaps forfeiting an award? Risky business, either way.
The best way to guard against learning a costly lesson includes a preemptive strike: spend a little extra time on the scope portion of the proposal letter. Make certain that inclusions and exclusions pertain to the job and are clearly and specifically stated.
And, it wouldn’t hurt to add a line that goes something like: “Any item that is neither cited in the inclusions portion of this proposal, nor specifically noted in the contract documents, is explicitly excluded from this proposal.”
