Preconstruction Services Best Practices

We tried to list and inventory the various best practices any pre-construction manager should follow to successfully manage the preconstruction phases of any construction project. Those best practices will help commercial property owners or facilities managers but also contractors and designers or architects as well as qualified bidders:

Scope of Work: Provide clear definitions and scopes of work to all potential bidders either via written detailed scopes of work to clearly define what is expected from each trade (framing, flooring, painting, etc). Creating a bid manual binder incorporating all necessary requirements such as insurance requirements, safety requirements, subcontracting agreement, instructions to bidders or general provisions to streamline the review of bids received.

Bid Lists: Establish a bid list as a collaborative effort with the architect or design team and the owner (facility manager, commercial property manager, building owner, business or office manager) very early in the project. Creating this list from an initial set of vendors or pre-vetted subcontractors will facilitate collaboration and comprehension.

Variance Reports: Are necessary steps to ensure estimates will reconcile with previous and future versions for tracking purposes.

Pre-Qualify Bidders: All vendors and subcontractors interested in bidding your construction project should be pre-qualified. Confirm that all bidders have financial backing and manpower (Verify they have w2 employees!!) to perform the work. They must have a successful history of completing similar work, meet legal and insurance requirements (ask for the Certificate of Insurance!!!) and that their current workload will not impact their ability to complete and perform. It is essential to know whether a subcontractor has objections to the subcontract language before including their offer or estimate in your own bid.

Pre-Bid Conferences: One of the best methods for retaining and attracting qualified bidders is to conduct a well-organized and comprehensive, , pre-bid review. Attendance at the review (conference call or ideally job walk) can be mandatory or strongly suggested for bidders and subcontractors to assure that as many qualified bids as possible are in the mix and received. Key topics that should be addressed during those pre-bid conferences are bidding requirements, site logistics, schedule, insurance and contract requirements and health and safety procedures.

Risk Reduction: Bidders and subcontractors are attracted to work that minimizes their risk, particularly in periods with many competing projects seeking for their attention and time. Pre-construction managers can maximize the number of bids received by ensuring, with the architects or design team, that the bidding documentation is as complete, thorough, and detailed as possible. Where questions may still remain, it is much better to define not to exceed allowances that all parties will carry in their estimates to cover ambiguous scope items or definitions than to assume bidders will interpret or assume scope of work or requirements that are still unclear. Unspent allowance dollars revert back to the facility manager or property owner, and additional change orders are allocated and distributed to the subcontractor to cover insufficient allowances.

Post-Bid Interviews: Prior to awarding any contract, it is essential to have a very detailed review of scope to determine that all subcontractors have covered their predefined scope of work in their contract. This is the best way to ensure that all bids received include comparable data and to allow that a low bidder or an off-beat bidder to submit change orders if still awarded the work.

Escalation Control: Provide a fair and unconditional way for contracting subs to account for construction material and labor increases in their bids. If market conditions indicate changes in material prices, bidders may not be able to hold their original prices for the typically specified period between bidding and executing or delivering the construction project. If forced property managers or building owners to hold their numbers which would oblige framers, plumbers, electricians, flooring installers or painters to cover the anticipated price escalation which impacts their ability to win bids.

There are more best practices to be added to this list. Which one would you suggest?