to gamble or not...

[OIIIIIIIO]

Hi

I got two quotes to dig up my yard for a foundation wall and to stub in floor drains, sewer and water (sewer and water are already at the location...just not at the exact spot) for my garage...

They are significantly different...

One quote was "not to exceed" $3500...if it's less I pay less...if it's more they eat the cost

The other was an estimate for $1800...that would go up if something unexpected comes up.

Both companies highly recommended in the community...the higher number comes from the "big" company...the smaller number comes from the somewhat "little" guy...

That's a huge difference but i understand they are two different types of quotes...

What might be some of the "unexpected" things that could come up that would significantly drive up the cost for the little guy?

Do I go back and ask the big company for an estimate rather than a not to exceed bid? Or is that bad practice after I asked for the not to exceed bid in the first place? the little guy doesn't do a not to exceed bid...

Thanks!
Patrick

 

[Daniel Dudley]

The first guy is offering you the very best price he can.

 

[chief ben]

GET EVERYTHING IN WRIGHTING''''''' I WATCH A LOT OF JUDGE JUDY,,,,
OR ASK YOUR WIFE WHAT SHE THINKS, CONTRACTS are BINDIND IN COURT.
When You Walk in My Shop The First Thing You See Is The Price Of A Hour Of Work, AND This Sign.

You Some Time Get What You Pay For,,, Some Times NOT,
Get It In Wrighting,
I Have Never Been To Court, And Only One Job I Had To Do Over,
I Messed Up One Time, And I Fixed It And The Guy Was Happy, And We Are Still Friends.

 

[NUTTSGT]

To me, it looks like the "big" company is allowing for a buffer to make more profit. You might get "we need to do this or that" from them and it'll account for the entire $3500.


Buyer beware.

 

[jabberwoki]

Don`t be afraid to ask for an exact quote you are in charge remember that.

 

[nmanitou]

I deal with bidding construction projects a lot in my work. What you have here is a classic scenario of two wildly variable bids with two very different assumptions from the bidders. My guess is that your "scope of work" is not defined well enough for either company to give you a realistic quote.

The first guy (big company) is experienced and has seen all kinds of things that can go wrong due to unknown conditions, or is more familiar with local codes. So, they pad their quote with a high contingency amount. (or they just don't need the work that bad - you never know)

The second guy needs work and has bid it as if he were working in heaven - everything will go as planned! Well guess what, it won't and when it comes time for a "change order" you are in a very poor negotiating position. What are you going to do - hire someone else to complete the work? - Not likely and they know it. So, the cost has a good chance of rising.

If you have a business relationship with either firm that changes things, especially if it is someone you trust to be fair with you. But if not, I would suggest doing all you can to define the scope of work, including contingency amounts for hard to estimate parts of the job. Also make sure you get hourly rates and material markup amounts as part of the quote. Then if things change, you have a pre-established method to calculate any extra costs.

Good Luck!

 

[ddawg16]

I deal with bidding construction projects a lot in my work. What you have here is a classic scenario of two wildly variable bids with two very different assumptions from the bidders. My guess is that your "scope of work" is not defined well enough for either company to give you a realistic quote.

The first guy (big company) is experienced and has seen all kinds of things that can go wrong due to unknown conditions, or is more familiar with local codes. So, they pad their quote with a high contingency amount. (or they just don't need the work that bad - you never know)

The second guy needs work and has bid it as if he were working in heaven - everything will go as planned! Well guess what, it won't and when it comes time for a "change order" you are in a very poor negotiating position. What are you going to do - hire someone else to complete the work? - Not likely and they know it. So, the cost has a good chance of rising.

If you have a business relationship with either firm that changes things, especially if it is someone you trust to be fair with you. But if not, I would suggest doing all you can to define the scope of work, including contingency amounts for hard to estimate parts of the job. Also make sure you get hourly rates and material markup amounts as part of the quote. Then if things change, you have a pre-established method to calculate any extra costs.

Good Luck!

I think that is about as accurate of a description as you can get. He pretty much spells it out.....

So...what you have to decide, based on your scope of work, which one is close to the real scope? Is there enough unknown that you could get hosed? If so, got with the 1st guy. If there are not a lot of unknowns and the 2nd guy can get it done pretty easy...go with him.

 

[OIIIIIIIO]

That's kind of what I'm looking for too...what are the unknowns in excavating?

Bid says dig for 180' of frost wall. What happens if they run into a house size rock under ground? It's still part of the 180' they estimated so in my mind that shouldn't matter...but at the same time I know that I pay for the "extra" and digging out a house size rock is extra...

So, what are possible unknowns in excavating?

I did get another quote earlier that was for $1200 but did not include the plumbing work, back filling the walls or removing the spoils from excavating...

Thanks!
Patrick

 

[rasit]

Rock, water and exising unknown utilities. Stable rock can be built on, but loose (boulders etc) that need to be removed can be costly in slowed production time, possibly needing larger/additional equipment, additional mobilization charges and disposal. Water costs can vary include pumping, over excavating and refill with additional stone, unstable/unsuitable foundation sub-grade, extra concrete for spread footings, foundation drainage system, disposal of unsuitable material etc. Hitting an existing utility can vary in cost from a few bucks for broken TV cable to thousands for a gas or electric line and lots more if someone gets hurt or killed. This may or may not be an issue on your private property, but I think all states have a toll free number to call before you dig and the utility companies in your area will come out and mark their lines. Make sure your contractor calls it in even if you are positive their are no lines in your dig area. It's a liability thing.....

Normally if you ask for a "not to exceed" price the contractor will give you two numbers. The first one would be what he expects it to cost you and the second one would be the most it will cost you. In your case of only getting the $3,500 "not to exceed" price you can pretty much figure he is going to come in around $3,425 when it's all said and done. I would do as already suggested by Nmanitou in defining the scope in detail and probably go with $1,800 guy.

 

[GarageEnvy]

I'll admit that even I probably wouldn't do this but you could go to your local library and look at the soils map for your area. At least in my area there are freakishly accurate soils maps that detail conditions down to the individual parcel. I've hired the same excavator on a flat rate basis and an hourly basis. The flat rate was basically pad prep and footings. There were some stumps and tree roots that he discovered that took extra time. Fortunately he was working with big equipment and it wasn't a major obstacle. Ask your contractor what unforeseen things would raise the cost. Personally, if the $1,800 guy was well established and working with good equipment and experienced enough to handle unexpected circumstances I'd take the gamble and go with him.