Low bid contractors. Here today, gone tomorrow.
Is it important to you as an owner to do business with contractors that are on solid financial footing, will do what they say they will do, and have been in business long enough to demonstrate that they will be there to stand behind their work?
“Just because you have money in your bank account today, doesn’t mean you’ll be in business tomorrow.”
This sage advice was given to me by the CEO of a large regional bank many years ago. He was reminding me that staying in business as a commercial contractor is not a volume business, it’s a margin business. Meaning, if you quote jobs just to “keep crews busy” vs. making sure you are actually not going to lose money on the job, you will stay in business. If you don’t make sure you have “margin” in your estimating (some income above material and labor costs), soon enough you will find yourself out of business.
If doing business with solid, reliable, and trustworthy commercial property contractors is important to you, then watch out for commercial contractors that are the low bidder on jobs by substantial amounts. Ask yourself these important questions: Will the low bidder be able to complete the job? Will the job be done correctly? Will the contractor be in business and able to handle warranty work when it is required?
Even better, by requiring pre-qulification steps outlined here prior to receiving bids, owners can determine in advance of actually receiving bids for a project if the bidders are solid, reliable, and trustworthy commercial property contractors.