How many projects that we build actually match what we budgeted? Do plans and specs matter, or are they more like guidelines?
Everything about bidding seems to be harder than it used to be, and the increase in construction pricing has made it harder for builders to get projects within the owner’s financial model. The pressure on everyone to get the design within budget is challenging. This seems to cause the budget and bid process to go on and on. Gone are the days when a project was designed, sent out to bid and then a bidder selected. It is a never-ending process to make changes based on what is driving cost and trying to get the project within a buildable financial model.
To overcome these challenges we can educate our clients first, rather than just send them the cost. We can provide an intensive review of the market, including factors affecting the market and supply chain challenges. We can suggest design and/or product changes to help get the design within the financial model. These things won’t solve all the problems, but at least they can illuminate some issues and open opportunities for solutions. It comes down to a better informed builder, equipped to make decisions and get the project built to the model’s specifications.
Another thing we may not realize is that a lot of our clients base budgets on their own takeoffs and unit pricing. They use SketchUp, Bluebeam or Revit software to quantify scope even though the work they are taking off is not shown in the model, and they are not trained in our trade. This results in lower quantities and thus lower dollar amounts for our scope of work. This is challenging for us because as soon as the budget for our scope is provided to the owner, the owner anchors on the price they are given. To overcome this, we can educate builders on how we take off our trade and how we price our trade. We can even go further by providing a conceptual budget even when our client says they can do it for us because they know how to.
By educating our clients on what will be required for our scope, we stand a better chance of getting a realistic conceptual budget and future budgets through final GMP at a complete and more reasonable dollar amount.
In addition to being 2022–2023 president of the Association of the Wall and Ceiling Industry, Travis Vap is CEO of South Valley Drywall, Inc. in Littleton, Colo.
