It’s no secret right now that all of us in the construction industry are doing our work for reduced prices just to keep the troops busy. But it wasn’t so long ago (and it may not be all that far in the future again) that the best single-trade contractors and construction suppliers were selective about who they worked for and which accounts were given their best pricing.
            It’s easy in today’s environment to get great prices from subcontractors (subs) that really need the work; however, the real challenge for us is to make sure that every sub we hire enjoys doing business with us and prices their work accordingly in good times and in bad. If our subcontractor’s prices aren’t competitive, our pricing to our prospective customers won’t be competitive either, and that means none of us will get the job. Here are some things our trade partners need in order to consistently give us their best pricing and service on every project:

 
 1) Plans and Specifications (specs) Free From Errors and Inconsistencies 
            Subs need accurate information in order to know exactly what it’s going to take to complete their scope of work. That may seem  obvious but oftentimes a subcontracting company is presented with a “builder” set of plans that meets the minimum requirements to obtain a building permit, but  may contain inconsistencies and/or lack information that will be required to compile an accurate bid, but that the municipality does not need  to issue a building permit. City reviews and inspections are primarily focused on the general safety of the improvements and compliance to building codes. For example, if the plan does not show enough room to allow for the specified decorative casing around a doorway, it’s not the city’s concern. The trim carpenter, however, will be delayed in his work if this problem isn’t discovered before he arrives to do his job. If he suspects he can’t rely on having a thoroughly vetted set of plans and comprehensive written specifications, he will be forced to build some contingency money into the bid for the unexplained work he will be expected to perform. We always review and correct plans (that may mean dozens of man-hours on our part in collaboration with the subs, but it’s worth it!) and publish comprehensive specs complete with shop drawings so that everyone knows exactly what they are bidding and are confident that any inconsistencies have been corrected.
 

2) Experienced On-Site Superintendents            
            Building a custom home involves a cast of thousands.  Scores of different people and multiple subcontracting companies are involved at every construction site and their efforts must be scheduled and coordinated to mesh smoothly with each other. Several hundred people move in and out of a typical custom home building site over the span of the project, and they all have to complete their work in the proper sequence so the next group of tradesman can fall in behind them to build the next piece of the structure. This choreography is a little different on each home and requires an on site leader that knows who to bring in and when. An experienced superintendent will schedule a subcontractor’s crew to arrive exactly when the project will be ready for them and not before so that there are no wasted trips. Our supers also review the plans and specs with each trade at the beginning of their work to make sure that questions are handled before they have a chance to become problems. A well organized jobsite run by a sharp superintendent means that subcontractors can get in and do their work efficiently in the number of hours they’ve budgeted and then move on to their next project. Lower prices are the result when a sub knows that a project he’s bidding will be organized and allow him to get the work done quickly.

 
3) Timely Purchase Orders 
            After plans and specs are completed, accurate pricing can be obtained for the various costs that go into building a home. At this pricing stage we often ask for several different option prices while we’re working with our homeowners to help them decide which items are important to them and their relative cost. We usually publish a set of “bid” specifications which are followed up after all the decisions are made with a final version of the specifications that are approved by the owner prior to construction. To avoid confusion from all of the numbers floating around and to verify what options are included in the final version, we issue Purchase Orders to each sub with prices that match the scope of work described in the final set of specifications. A Purchase Order is our promise to pay the agreed amount for the exact work to be performed. We have been using them for years, and they have saved us and our subs a great deal of time and money by alerting both parties early on if there is any miscommunication.
 

4) Prompt Payments 
            Slow payments from general contractors to their subcontractors is so pervasive that the State of Arizona actually passed a statute regulating the length of time that a payment to a sub can be delayed. We have always paid our bills on the 1st and the 15th of each month, and that reputation for quick pay translates into Calvis Wyant being a preferred account for our trade partners and suppliers. Obviously, subs want to work for the companies that pay them on time and without a hassle, and it’s more efficient for them to do business with someone like CW.
 

5) Repeat Business 
            We have some supplier and subcontractor relationships that date back to the beginning of our company in 1986. Although we understand the possibility of a trade partner getting comfortable and not always giving us his best pricing, our experience has proven otherwise. If a subcontractor has a long history of getting well organized projects with good plans and specs from a building company with fair business practices and who always pays on time, that sub is going to make every effort to ensure that his bid is priced competitively. The last thing he wants to do is run the risk of losing a dream account to a competitor and perhaps never get it back. We continually price out our work to different sources to ensure that we always receive the best possible value, and rarely do we find the need to vary from our trusted group of quality tradesmen.
 
           Nothing too magical on this list, is there? The rules above have served us well, and they form the basis for our many wonderful relationships here at CW. 
             I started this article off by saying how great prices are today. I think they’ll be this way for a little while yet, but remember that a custom home design started today won’t be ready for pricing for at least 6-8 months. If you have been waiting for the right time to start the process of designing and building your new home, let this be your wake-up call to take advantage of pricing that may never be this low again.