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Why Hiring the Lowest Bidder is a Terrible Idea

Adapted from our friends at Dow Smith

 

We often see owners hiring architects to design a building or a specialized facility, then choosing the least expensive builder to construct it.

If you needed heart surgery, would you ask your friends who the least expensive surgeon is? Of course not! You would want to find the best qualified surgeon to ensure the best outcome—the one who has performed that same surgery time and time again with positive results.

Choosing a commercial building contractor is no different. But, we often see owners hiring architects to design a building or a specialized facility, then choosing the least expensive builder to construct it.

Here are 5 reasons why choosing the lowest bidder can actually end up costing you more time and money:

1. Choosing the lowest bidder does not ensure you have chosen the contractor with the most experience or the highest standards to build your type of project.

2. To keep costs low in an effort to win the bid, some contractors will “squeeze” their subcontractors to force their numbers lower. You have heard the saying, “You get what you pay for.” Subcontractors forced to reduce their numbers to win the contract and remain in the good graces of the general contractor may cut corners to remain profitable.

3. Contractors, subcontractors and materials suppliers can interpret the architect’s specifications and drawings very differently. So, one bidder can be significantly lower than another. The owner believes they are comparing apples-to-apples, but in reality, the lowest bidder may not be accurately estimating the project. Sadly, the owner usually discovers this much later in the process through change orders, which leads me to my next point…

4. Choosing the lowest bidder can often end up in disputes, which can cause litigation, delayed schedules, increased costs and shoddy workmanship.

5. Without the contractor’s input during the design phase, the actual bid can’t be determined until the design phase is complete and the project has been sent out to bid. This is typically where the owner is shocked to find out that the project cannot be constructed within their budget. This can result in the project being scrapped altogether, or having to go back to the architect to redesign the project to bring it back into budget. Again, more time and money lost and lots of headaches for the owner.

How should you choose your contractor?

Ideally, we highly recommend that the owner contract with their builder early during the design phase. In the best case scenario, we recommend that the owner hire a design build firm that will understand the owners goals and objectives and implement both design and budget goals early in the process.

You should choose your contractor based upon capabilities, experience, honesty and reputation within the community. You should also research who the best contractors are for the type of project you plan to build and interview those contractors BEFORE the design stage. Why? A competent general contractor will provide accurate cost estimating, value-engineering and other technical construction expertise through the concept and design stages that can help ensure the success of the project from the very beginning.

A Design Build contractor will work to achieve the design you want…one that can actually be built on the chosen site and within your budget. A contractor who knows that their future (and repeat client) work can be earned based upon quality workmanship, effective communication and top performance rather than their skill at low-balling an estimate is a contractor who will deliver a successful project for you on time and within your budget. When you follow this path, you gain a partner who is just as much interested in your success as their own. Have a project in mind? PBS can help you. If you have any questions please contact our design-build team at 855.672.4010 or click here. We look forward to serving you!

The Practice of Church Design-Build

by Carol Badaracco Padgett of Church.Design

"I'm here to talk about the connection of faith and works," said keynote speaker Erik Cooper with The Stone Table based in Indianapolis. The Stone Table is a resource community for faith, work and missions. Cooper's talk kicked off the 2019 annual meeting of the National Association of Church Design Builders (NACDB), Sept. 10-11, in the business offices of the Texas Rangers Stadium in Arlington, Texas.

NACDB is a nationwide association of construction-related specialists that consult, design and build churches.

Cooper's talk encouraged the nearly 65 committed companies represented at the annual meeting to focus on design-build in a team framework operating on the concept of faith and works.

Church.Design spoke with NACDB Executive Director Meghan Williams about the organization's purpose and mission--and where church design is headed moving forward.

The Practice Of Church Design Build Meghan

Church.Design: When you break it down to its fundamental mission and function, what does the NACDB do?

Williams: We connect like-minded firms by educating and equipping them to serve and provide resources to faith-based markets and customers. Our vision is to integrate biblical values into the creation of facilities that positively impact the Kingdom of God.

Church.Design: How do architects, builders, interior designers and AV consultants benefit from being an NACDB member, on a business level?

Williams: Due to the continuing education and 'iron that sharpens iron' that occurs between each NACDB member, the personal and professional growth that members experience is always noted as their most valued benefit. In addition, they have the opportunity to highlight their craft and position themselves as experts in the field with other NACDB members and churches.

Church.Design: Are there special things that a church is looking for from a design and building partner, aside from what a secular company might look for?

Williams: NACDB’s standard of integrating biblical values into the creation of facilities is an outspoken principle behind every project we take on and one that many secular companies cannot compare.

One of NACDB’s core values is excellence, and this goes beyond the secular definition of excellence. NACDB defines excellence as ‘we are employed by God and He deserves our best in all we do.’ This is a value that churches can get behind because the focus is not on creating a building with beautiful features, the focus is on creating a space where people can meet and experience God.

Church.Design: How is NACDB preparing for the future of church design and building, and what does that look like in terms of your offerings to your members? In addition, what will your style of guidance look like as executive director?

Williams: We understand that every church is different. Many churches may look the same [to] an outsider, but the way in which the spaces are utilized for a church’s ministry varies from one facility to another. That is why it is so important to have a team of experienced designers and builders to come together to work with the church’s leadership to determine their ‘why’ before jumping into a building project.

As the executive director, it is my job to fulfill the association’s mission and vision while remaining the church’s ‘go-to resource’ for all church design and build needs. This means I need to be on top of recruiting and maintaining members of the highest standards of excellence, integrity and commitment to expanding the Kingdom of God.

Church.Design: What are the aspects of church design-build (putting the two disciplines together under one roof) that you believe are most beneficial to churches?

Williams: Our member Kurt Williams of T&W Church Solutions out of Indianapolis describes it this way, "Design-Build has continued to grow as a delivery system due to the simple fact that it protects churches from the unfortunate statistics and pain that the traditional approach of Design-Bid-Build produces, due to the lack of collaboration and adversarial alignment:

  • 50% of churches have an expensive set of plans that they will never build … due primarily to initial budget bust
  • The average cost overrun on a church project is in excess of 25% from the original bid
  • Construction is still the second most litigated industry, behind medical

When the entire team (owner, designer, builder, key consultants and engineers) are at the table together, collaborating and seeking to find the best solution for the church, the creative solutions (that are buildable and economical) are boundless. Design-Build is truly a team effort."

Church.Design: Are all your members structured as design-build firms, or are there standalone architecture and building firms?

Williams: Our membership covers several industries. We are structured with design-build firms, architecture firms, security specialists, sign and theming specialists, café vendors, marketing experts, audio/visual/lighting specialists, capital campaign consultants, church financing and law services.

[Again,] 'iron sharpening iron.' All of our members are vetted and board-approved, so we feel comfortable working together and recommending members to churches across the nation. We meet throughout the year to fellowship and discuss market trends and best practices. We offer a Certified Church Consultant program to our members to educate them on the building needs of the church. And we continually share information on how to best design and build for today’s church.

Church.Design: What does the future of church design look like to you, leading into 2020?

Williams: There are several directions we see churches taking with their design, according to Ravi Waldon of Waldon Studio Architects. Here's a list he provides:

  • We are seeing the old line denominational churches consolidating and either trying to renovate existing space to reflect a more contemporary worship attitude and/or dispose of old real estate.
  • Security and design have really become a prime focus. Over time, these design elements will become more subtle and integrated into the design.
  • Environmental graphics and interior design are becoming more sophisticated.
  • We are seeing improvements from the relationship of the building to nature, further enhancing spaces for community and fellowship.
  • Worship experiential design is increasingly important from the AVL technology utilization standpoint but at the same time, worship space design itself is returning to a more sacred space feeling--but in a modern way.
  • In order to be more engaged in the community, churches continue to explore new ventures such as skilled care and independent senior living, affordable housing, adult day care or K-12 academies. These ventures develop a continued revenue stream given the expense of real estate in communities today.
  • Churches in general are getting smaller in size. Mostly below 1,500 seats. A lot of this has to do with the trend to multisite. This allows for better community and less investment in large infrastructure.
  • There has also been a turn towards a more mixed-use approach. Churches are becoming less insular in their engagement with their communities. They are starting to build facilities with the community in mind, instead of just creating space for their congregation.

Church.Design: Is there anything else you'd like to add?

Williams: Our [ultimate] goal is to help the church navigate the building process. Our members have hundreds of years of collaborative experience in the church building market. Each one of our members believes that the church building should be built around ministry. [Churches] have a mission, a vision and a purpose that is unique--and [they] should continue to focus on that throughout the building process.

The NACDB’s job is to show the different building methods, best practices and the ways [they] might be able to save money and connect to our board-approved, vetted members from across the country.

(Source: https://church.design/cover_stories/a-close-up-look-at-church-design-build/)

Achieving “Ground Breaking” Success

In early October, PBS participated in the ground breaking ceremony for Rhino Baseball’s new indoor training facility at 301 Gregory Court in Shorewood, IL. When it opens, it will provide baseball players with advanced training and development, while preparing them for their future endeavors.

Representing PBS at the ceremony were Chad Charon, vice president, Bryan Reiser, vice president of operations and Brad Podowski, marketing manager. They were joined, among others, by Greg Blaesing, president of Rhino Baseball, Andrew Tehako, co-owner/operations manager of Rhino, Kelley Chrisse of the Village of Shorewood, plan commission board members and village board members to officially break ground on the property.

“Choosing PBS for this design-build was the best decision we could have made,” said Greg Blaesing. 

“From our first meeting with PBS, Chad, Bryan, Erik and the rest of the staff have been amazing and their customer service second to none. Choosing PBS for this design-build was the best decision we could have made,” said Greg Blaesing. This project has involved close communications between Rhino Baseball and PBS as a single source of delivery between owner and the PBS design-build team. “By taking the time together to carefully plan a facility which will inevitably be a tool for the expansion of what is already an incredible program, this design-build process has allowed Rhino Baseball to ensure that what was being designed would meet their needs as well as overall budget,” said Chad Charon.

When complete, the 50,000 square-foot state of the art facility, designed and built by PBS, will include a major league-sized clear span infield, a 60 yard dash track, long toss area, 6 full length batting cages, a weight room, and a classroom.

“We shopped our project around to a number of different design-build companies. Ultimately we chose PBS because they were competitively priced, their whole staff was responsive and engaged, and they truly care for their customers long-term success,” said Blaesing. PBS is honored to be in partnership with Rhino Baseball and working alongside the Village of Shorewood to bring this state-of-the-art facility to life.

PBS is experienced in the planning, design and construction of many different types of facilities throughout Illinois, Indiana and Wisconsin, including a portfolio of successful commercial, industrial, church and municipal projects. If you have any questions please contact our design-build team at 855.672.4010 or click here. We look forward to serving you!

Need Space / Where do I Begin

Circumstance

• You’re in an existing building paying rent and desire to have your own space.
• Or, you’re in your own building and are running out of space.

These are circumstances that any successful business will find themselves in at some point in time. Having a trustworthy partner to help walk you through the process of dealing with these circumstances will be key. You wouldn’t tighten a bolt with a hammer. Choosing the right partner is like choosing the right tool from the tool box. Choosing the wrong partner is like trying to tighten that bolt with the hammer (you may eventually get it tightened, but the process to completion will leave a messy trail). There is generally little to no progress, frustration mounts and you end up wishing you had utilized the correct tool. Your design-build partner is a tool for your success.

Can I actually do this?
If any of the above circumstances resonate with where you are at on your journey, then you are not alone. Recently, we had the honor of partnering with a client to design and build their new building. This client, operating a successful business never thought they could purchase property, design and build a new building for less than what they were paying someone else in monthly rent. Through utilizing a fully integrated design-build planning process, they were pleasantly surprised. Now they have a real estate asset that will appreciate over time and their own home for their growing business. While this may not always be the case as it relates to rent vs. build; if you choose the right partner you will end up with the right long-term solution.

Who can help me?
The above noted line of thinking is not uncommon as the construction market has unfortunately developed a reputation for owner’s being taken advantage of as well as for projects being overdesigned and unaffordable to build. Owners who have little knowledge or experience with design and construction, at no fault of their own, are left to rely on the “traditional norms” or the recommendation of someone they know, whether appropriate for their circumstance or not. This approach can often lead to complications during planning and construction. As they pursue having someone design their “dream” building they learn that there are four or five additional entities that they will need to bring together leaving them, the owner, to assume complete responsibility for the entire design and engineering team. If not a fully integrated team under one umbrella, the owner is left responsible for ensuring all parties are communicating and on the same page. Or, an owner invests a significant amount of money to develop their dream plans only to find out the project is not affordable bringing them back to square one, costing them crucial time and money. They are left with little ability to make changes without significant cost implications. This, also prior to your even finding a trustworthy builder who is relying on your guarantee as owner that all of the design and engineering is free from error.

So, where do I begin?
Find a fully integrated design-build team that will walk alongside you and help guide you through the entire process of planning, design and construction. They will develop a plan with you that will accommodate your present and growing needs including overall costs that are in-line with your budget. Make sure they listen and guide vs. hear and push. In the end, you will have a partner who truly has your best interests at heart and assumes complete responsibility for the design and construction of your project.

Choosing Where to Build

Location, location, location! It's the real estate agents' mantra. You've probably heard the phrase before. The saying is repeated three times for emphasis, and it is the number one rule in real estate, while also the most overlooked. The same can be said for new construction.

To get the most out of your building investment, where you build is often as important as how you build. When selecting the site for your building, it’s wise to have a list of criteria for considering an ideal site. In PBS’ Planning Guide, we walk you through that process in a section called: “Review Your Company’s Building Needs”. It continues with “Choosing the Right Location”. In this article, we will walk you through 5 areas to consider when choosing a building site.

 

Access to Transportation and Shipping

How far are you from the nearest airport, railroad or major highway? If your business is primarily involved in the transportation of goods, these points will make a difference in your future productivity. You may also want to consider the degree of difficulty your team will face in commuting to your new location.

Range of Local Employment Resources

If the nature of your business is such that you must frequently re-staff or hire seasonal support, you’ll need to take a careful look at the labor pool available in your new location.

Determine Utility Infrastructure, Building Codes and Zoning Requirements

Each city, county and state has its own set of rules and regulations when it comes to overseeing the business sector. Some could save your organization money and/or time, while others may present a potential headache for you. Plan on doing a thorough investigation of these areas before you commit to any property. PBS, by having experience in knowing the right questions to ask can help you through this.

Determine Parking Requirements

When planning the position of the building on your site, consider allowable access from the nearest street or highway, as well as allocation of parking space. If your property is on an irregular plot, try incorporating parking and storage on the irregular side if it is consistent with the topography of your site or on the low point of your property. This will allow for proper drainage and free up the high ground for building construction.

Determine the Load-Bearing Capacity of the Soil

You will need to arrange for sub-soil investigation by a professional testing laboratory to see if it will accommodate your building plans. In addition, it is critical to determine the past history of the site and to determine if significant top soil or fill issues are present that will need to be removed. PBS can help you with this.

To learn the other areas of consideration when choosing a building site as well as questions to ask when planning for a new facility, please request our FREE Planning Guide. PBS is experienced in the planning, design and construction of many different types of facilities including a portfolio of successful commercial, industrial, church and municipal projects. If you have any questions please contact our design-build team at 855.672.4010 or click here. We look forward to serving you.