Exposing the 3 Bid Rule

We’ve all heard it over and over “Get three bids”. It’s the old adage that is suppose to give you peace of mind that whoever you hire isn’t cheating you. Admittedly, for many areas of home improvement this is advisable but for large renovations or custom homes it doesn’t work. When does it work? Let’s say you are in the market for a new HVAC system, definitely get 3 bids because it’s straightforward to compare apples to apples. For a new fence, definitely get three bids because it’s also straight forward. Getting three bids works well and offers peace of mind when what you’re doing is uncomplicated and quickly understood. However, with complex jobs assuming that all three bids reflect all the same specifications with the only difference being price is a very dangerous assumption and unreliable. The old way of thinking tells us that participating contractors estimate the same plans, scope of work and specs the same exact way. This just isn’t the case because contractors, professional or not estimate differently. As a result, the prices they will come up with are also different therefore, not true apples to apples but apples to oranges. The differences could be subtle or maybe not, however, the bigger issue is that it isn’t reflective of the true cost of your project which leads to improper expectations and eventual conflict. Further, with this three bid method your contractor of choice is reduced to a number which is the absolute worst way to select a builder you will spend what could be, a couple of years with. When shopping for your next contractor, it is far more important to consider experience, skill set, personality, reputation and overall ability to get the job done. Determine what it is you consider to be valuable. Is it price, is it trust and experience, is it character and integrity?

Find a builder you can join forces with, collaborate with and be a team with. In order to do this consider “fit” i.e, do you like this person, does this person listen well, does this person demonstrate character and integrity, does this person have a reputation for quality work and does this person offer a warranty? Renovating isn’t inexpensive nor is it easy. It requires a commitment of client’s time, energy, focus and finances for an extended period. With older homes, unforeseen conditions are found once the project begins that are discovered inside walls, ceilings, floors, etc. that has the potential of causing delays and typically adding extra expense in order to rectify properly. Historically speaking, we do recommend having 10% to 30% of your projects cost for additional expenses i.e., unexpected findings or for things you may elect to change. If you do not spend it great, but if you need it, it’s there.

We hope this has assisted you in a learning a new perspective on an outdated method of shopping for a contractor and why it is the superior method. If you should have any questions or comments please feel free to reach out anytime.

 

 


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Key Structures, LLC
Chesapeake, VA 23322
757-435-9459
Virginia General Contractors License #2705132708

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