era | Procure MAKE IT HAPPEN
STEP FOURTEEN
IN THE PROCESS TO DESIGN + BUILD ARCHITECTURE SPECIFIC TO YOU.
how you will build the reality
Learn the options, decide which procurement method is right for you and tender your architecture.
Get to know your procurement method.
To procure is to obtain something with care and effort.
In the construction industry it is most often referred to as ‘the procurement method’.
For me, the procurement step in the process involves two parts:
Method
Action
Method
You may have already come across a construction contract, but even if you have, read on to get an understanding of what options you have, or what option you may already be involved in.
There are two main procurement methods:
A single construction contract – usually the most common method
OR
Multiple construction contracts – not as common
A single construction contract means that you employ a single contractor to complete all or most of the construction work for your architecture. You may employ a single contractor for most of the work, but still employ other contractors with their own individual construction contracts with you for minor work, and the procurement method will still be called a single construction contract.
Multiple construction contracts is as it sounds – you have multiple construction contracts operating for the one project. This option involves a greater level of organisation and management.
The method that you use will depend on what suits you and your architecture, particularly the plan that you have chosen, but also including your place, your cash flow, your time frame, the type of work to be completed, the type of construction.
Action
Once you have chosen the method that will suit you, you can take action.
Unless you are already involved in a contract with a design and construction organisation or project home builder, your action will likely be in the form of one or more of the following.
In case you are unfamiliar, a tender is a way of requesting a detailed quotation from a contractor.
A tender requires documents to be issued to contractors or tenderers so that they can review them and submit a cost to build your architecture.
- Open Tender – The documents are advertised, such as in the newspaper, and anyone can review them to prepare and submit a tender for review. More than one tender will hopefully be submitted to ensure there are options to choose from and therefore a ‘competitive tender’. Tenders are submitted by a certain time on a certain day and reviewed by you and|or your design team. One submission is chosen as the preferred tender and any information in addition to the documents submitted are requested from the tenderer. When you accept the tender, the terms of the contract commence.
- Selected Tender – The documents are sent to one or, usually, more than one contractor to request that they submit a tender for your architecture. A tender is submitted by each of the selected tenderers. Tenders are submitted by a certain time on a certain day and reviewed by you and|or your design team. One submission is chosen as the preferred tender and any information in addition to the documents submitted are requested from the tenderer. When you accept the tender, the terms of the contract commence.
- Negotiated Tender – The contractor or contractors are contacted directly to discuss the opportunity to build your architecture. The extent of work is discussed. The extent, inclusions, exclusions, cost and contract type are negotiated until an agreement is made. When an agreement is accepted by both parties, the terms of the contract commence.
- Expression of Interest – Pre-qualification requirements you or your design team have prepared are advertised or sent to selected parties requesting an expression of interest. The contractors who have applied though an open invitation or who have been selected, will submit a document called an Expression of Interest in response to the pre-qualification requirements. The submissions will be reviewed based on these requirements and a contractor will be chosen. The successful contractor or contractors will discuss the technical details of the type of contract and contract documents with you and your design team before making a final agreement to proceed.
Which procurement method is right for you and your architecture?
The decision for which procurement method you use may have been made for you by someone else, such as a professional you are working with.
If not, let’s go back to your purpose for a moment. What did you discover there?
Then look at your plan. Was an option for which contract method to use made then?
If you haven’t established a procurement method yet, then it may be a topic you will discuss with your design team, or it may be something you are deciding for yourself.
If you are purchasing an ‘off-the-plan’ design with a design and construction organisation or project home builder, they will have a standard procurement method, usually with the use of a single construction contract. They will use sub-contractors or tradesmen who they have an established relationship with, and the contract you sign with them will be one that suits that purpose.
It is good for you to know, however, how everything is working and what it might mean to you.
There are risks and advantages to each method, however the single construction contract is the most common type of procurement method.
A selected tender or negotiated tender appear to be the most common action taken for smaller work,
If you have a large project an open tender is more likely to be used.
If there are issues of complexity or unresolved issues, an expression of interest action is likely to be used.
Here is a quick and very general breakdown:
Single Construction Contract
This option is suitable if you are able to put all the requirements for your architecture into a single set of documents for someone, such as a contractor, to build from. This option puts more risk on the contractor, as they hold the responsibility to schedule time and tradesmen and complete all of the work.
Documents prepared to show how to build your architecture can be simpler if they are showing all of your architecture, rather than being split into multiple sections for multiple contracts.
An overall price for the construction work can be established between you and the contractor before work commences.
If any changes are made after the construction contract commences, there will be variations in time and cost associated with that change.
The management of time and cost as the construction progresses is the contractors responsibility.
Multiple Construction Contracts
This option is suitable if you are not able to put all the requirements for your architecture into a single set of documents for someone to build from. This option puts more risk on you, as you hold the responsibility to schedule time, cost and contracts as well as ensure all of the work is completed.
How to prepare to tender.
A Tender Checklist will help you keep track of everything you need to issue when it comes to tendering.
Documents issued for tender may include:
- The documents you have prepared to show how to build your architecture, including drawings, specifications and schedules.
- The construction contract you wish to use, or reference to the contract you wish to use.
- Additional information such as a written description of the work or special conditions that will be specific to the agreement you make with the contractor.
Make sure that the documents you are issuing for tender are clear about the extent of the work you would like the contractor to complete, particularly if there are multiple contracts. You literally need to draw a line in the sand for where the work starts and stops so it is clear to every body involved.
Also keep in mind that these documents will form the contract you make with the contractor. Anything you wish to add after the agreement has been made will likely be additional to the time frame and cost.
Once your documents are out there in the world, and contractors are looking at them, you may receive questions. You need to keep track of the questions and make sure all of the tenderers are given the answers, whether they have asked the questions or not, to ensure the tender is fair.
You can keep track of Tender Queries in a Tender Queries Schedule and issue information during a Tender Period to all tenderers with a Tender Addendum. Any Addenda issued will form part of the construction contract.
If you have employed a professional such as an architect, designer, design and construction organisation or project home builder to procure your architecture for you, they will likely take care of most things. But make sure you are clear on any responsibilities you have to ensure you deliver the information required by you to them in a timely manner so as not to affect the process.
Your procurement in the process.
The plan you chose affects the procurement method you choose, or that someone chooses for you.
The choice of what type of procurement method you use will determine which construction contract you utilise to work with a contractor to build your architecture.
THE PROCESS.
This is the fourteenth step in the process to design and build architecture.
If you would like to see how this step fits within the process, you may be interested in a little Book I have written that sets out each step in the Process in one place. It is a guide and workbook to help you through each step in your architectural journey.
The process is summarised in this little Blog post - era | the Process to Design + Build Architecture.
Each step in the process will also be broken down into its individual steps right here in this little Blog - so keep checking in to see the whole set!
Til next time!
Start the process to find your architectural language and make your little ideas a reality.
Click here to see the little things I have made for you, or click here if you would like to work with me one on one.