COST + FIXED FEE
Our + Pricing
COST + FIXED FEEAn important aspect of working with a general contractor that is often overlooked by clients is the general contractor fee and accounting structure.
We prefer the general contractor fixed fee and open books accounting method. Fixed fee is the most straightforward, simple and fair system between general contractor and client. In this agreement, our homeowners pay for the materials, at our general contractor price taking advantage of our discounts, the labor to perform the work taking advantage of our general contractor discounts and we incorporate our general contractor fixed fee that is fair and reasonable for the scope of work to be performed.
HOW IT + WORKS We agree on a general contractor fixed fee with our clients that we will be paid as the General Contractor for the project. Several factors are considered when determining the fee: the estimated construction cost, overall size, complexity of the project, the timeline of construction, to name a few.
Our general contractor fixed fee creates the fewest conflicts of interest and helps ensure that all parties work together honestly and that upon completion of the home, all parties feel they were treated fairly.
The bottom line is that you want to pay your general contractor a fair price for the work performed. Our role in the project is a crucial one and there is a reason that it is a profession. Many people think they can do this job themselves to save money, but soon realize there is much more to it than meets the uneducated eye. Our team identifies potential problems before they become a problem and can determine by inspecting the work performed if there is something that needs correcting. Fixing problems that do arise at the right time is much less expensive than discovering them once the project is completed. Selecting the right general contractor will make or break the project.
OUR PRICING + DIFFERENCE Sometimes the fixed fee method is confused with the percentage fee method, sometimes referred to as cost plus. With the percentage fee method, the general contractor estimates all the work to be performed. Once construction starts, the general contractor marks up all the labor and material invoices by a set percentage. The problem with this arrangement is that there is no incentive to try to keep costs down because the more construction costs, the more money the general contractor will make. Most general contractors are reputable and honest and will not take advantage of their clients, but we feel that it is better not to structure the general contractor fee in such a way that creates a conflict of interest.
Sometimes general contractors, in an effort to get new work, bid a job too low. In this case the general contractor can run out of money before the project is completed. Several bad things can result from this. We have all heard stories of general contractors taking on other work to help defray costs, thereby leaving the underbid project with very little supervision or quality control or in some cases an unfinished project. Others choose to pass on the cost of the underbid project to the clients with a large payment at the end of construction just to complete the project. The low bidding method does not offer predictability or security to anyone involved.
WIN + WIN Through our years of experience we find the above financial arrangements to be clean and easy, as well as will provide our clients with the best price for the project. Using our proven methods, the concern of the general contractor utilizing the incentive to downgrade components or the need to hire unskilled labor or possibly submitting a large payment request just to recoup money on an underbid project is eliminated.
PRICE + INCLUDES Lot/Land Evaluation
Design & Engineering Services
Estimating Project Cost and Budgets
Consultation & Industry Standards
Permitting to include HLP, LGP, Septic and Building Permits
All Construction Coordination to include meeting with all vendors to review Plans & Specifications
Material take-offs and ordering
Contacting and scheduling of all suppliers and subcontractors
Pricing Review of all Sub-Contractors
Project Supervision on day to day operations
Quality Control and Waste Management
Invoice Verification and Approval
County and City Inspections for Certificate of Occupancy
Associated Fees
Builder warranty & compliance for all suppliers and subcontractors