Spend Visibility -- Use RFPs with Home Maintenance Contractors
Most home owners proceed blindly when obtaining bids for house repairs because they don't speak "contractor". Just as you don't need a PhD in computer science to efficiently procure software, it's not necessary to possess construction trade skills to take charge of contracting home maintenance, repairs and enhancements.
By writing your own RFP -- in your own words -- and requiring your bidders to follow its sequence you will be able to much more easily compare bids and negotiate the best price for the job. Break the project down into obvious tasks and indicate a separate line item price for Labor and one for Material. For example: Let's say you want additional electric outlets in various rooms and some recessed lighting installed. Request line item prices for Electrical Labor, Electrical Material (wire, circuit breakers, boxes, receptacles face plates and ceiling fixtures), Wall & Ceiling Patching Labor, Patching Material, Paint Labor and Paint. Tell the contractor that you want to go along to a big box, or local hardware store and buy the materials with a credit card so you can reap the airline miles -- this exercise is a great way to observe and become better acquainted with the person you're entrusting to work in your home -- and also ask for a discount for paying the Labor in cash. If your prospective contractor balks at either request, choose one who doesn't -- you'll avoid the buried materials mark-up and almost always get a better job from a hungry contractor who knows you're on top of your spend.
I would also suggest not accepting T&M (time and materials) bids. The job will cost more 95% of the time as there is no incentive to work quickly and efficiently. And if you're handy with a paint brush, save a bit more, when appropriate, by touching up the patched areas yourself.
BTW Please feel free to post suggestions for topics on this week's thread or email questions to wbusch(at)spendmatters(dot)com.
- William Busch, Retired Contractor and Spend Matters Columnist
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... nor do you need an MBA.
Just a note - be careful when buying the materials yourself. In many cases this will void your warranty. The contractor will only be responsible for defects in workmanship, not materials, and many defects are debatable in this regard.
