NO MORE BIDS To avoid battling low bids, some remodelers remove themselves from the bidding wars. Lauten says the “competitive” bid process is often not useful for a homeowner who wants the best value. “Even with a complete set of plans and specifications, there will be differing assumptions made in quality levels and variations in service delivery between bidders. When lowest cost is the deciding factor, the conscientious bidder who includes better materials and plans a better-managed job will lose out to one who does not. We prefer a cooperative approach, such as the negotiated contract,” he says.
At the first meeting with clients, Sinn tells them that if they choose to bid the project, the Sinn Design Build price will be higher. She explains why by talking about the company’s design/build process, which begins with a design assessment. “I show them the type of plans we will have produced by our architect, [and that] we will keep them on track and on budget,” Sinn explains.
She also talks about how pricing can affect product selection. Her staff continually prices throughout the process so clients can make choices. “This makes clients feel more in control,” she says.
Sinn says that clients hire her for her expertise, and if they argue over costs, she will not work with them. “If I get resistance, it is not a good fit,” she says.
Cholfin assesses a client’s qualifications in the early stages. “We are trying different processes to pre-qualify and make sure they are a customer that fits our profile, so we do not waste their time and they do not waste ours,” he says.
Then, he works diligently to get them to commit to a budget amount. Unfortunately, he says, many clients make the assumption that the project will consume their whole budget. “We assure them our goal is to give them the project that is going to satisfy as many of their requirements as possible, at a number they are willing to spend,” Cholfin says.
Feig-Sandoval says having an established 30-year-old company with a lot of repeat and referral business helps him compete with lowballers. He has also begun to market his firm to the upper-end market where clients are less likely to choose a contractor based solely on price.