Lowest Bid – Sometimes you get what you pay for

We’ve worked with clients in the past that had to engage a contractor before or after closing. It’s wise to get multiple bids from several vendors. I’m a big believer in referrals so I think it’s especially wise to get some estimates from trusted referral sources. Sometimes folks automatically choose the lowest bid, which can sometimes have negative ramifications.

Sometimes contractors underestimate the scope of the project and later try to justify an increase in price. Sometimes the lower price is indicative of an inferior operation altogether, which can affect schedule delays, delay of ordering the right parts or materials, or other basic operational components of a project. We once had a “lowest bid” roofer that didn’t order enough roofing material for a job and the mistake could have delayed closing if not for reasonable negotiations on both sides of the transaction. One would think that ordering enough roofing material would be a key component of a roofer’s service!

Lowest bid projects can often result in a discrepancy between what the client really wanted and what the contractor assumed the job would entail. This can cause a lot of stress on both sides and sometimes the job will need to be redone from scratch or lawyers will need to get involved. Not a pretty picture!

In summary, we advise our clients that if they choose “the lowest bid” that it’s wise to get the project fully scoped and agreed to in writing, with possible contractor penalties for schedule delays or “scope creep.” The lowest bid vendor may end up doing a great job but if they don’t it’s wise to have expectations written and agreed to in advance. Because, as we know in life, you often get what you pay for.

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