Meeting with the Client

I remember years ago when my father and I bid on a major addition for a client whose remodeling work we had already performed in the past. It was a fairly sizable, complex project that required a lot of engineering and logistical difficulties due to barriers in access to key areas. Our final bid came in around $700,000 which—for the time—was fairly expensive. Even though we had a trustworthy working relationship, the customer informed us that they were also getting other bids. That seemed reasonable, as they appeared to be doing their due diligence.

Eventually they came back to my father and figured our proposed cost was not in their budget. My father explained detailed expectations of the work to be done, and offered suggestions on how they could adjust their plans and change the scope to lessen the cost. In the end, after wrangling with my father to drop his prices (without being willing to change the scope), they decided to go with a bid from another contractor that was about half the cost of what our bid was. Even though they knew what to expect from us as a company and our workmanship and the other contractor was an unknown entity, cost was a much more important factor in the end.

What happens when the scope isn't delivered?

But there's a problem with that: As it turned out, the contractor they hired underbid the project, and ended up causing such a major fiasco for the clients that they hired us to finish the job—while they were in litigation with the other contractor! In the end from start the finish, the project cost the client almost a million dollars and 5 years of their lives spent with their home in construction limbo. Yikes!

Why did this happen?

There's a lot of misinformation from the Internet, publications, and even from contractors or architects that creates such wildly different costs and quality expectations. It's no wonder when the homeowner is confused, frustrated, and somewhat mistrusting. This story shows how important it is to stay transparent and communicate expectations from the start of any project. If you underbid a project to win the job, the client will eventually discover the error. Your company, your reputation, and your livelihood are at stake.

What responsibility does the contractor have?

As a contractor, it's my responsibility to use my knowledge and experience to communicate to a customer what I think a project will cost. If a client expects to receive a $150,000 kitchen for $75,000, then it's my job to gently inform them what they can realistically expect for each of these budgets. For me, it's about educating; chances are, they don't know exactly what their dream kitchen will cost. What they're looking for is a contractor to be honest and straightforward about what the associated costs might be.