David Mosey, partner and head of projects and construction, Trowers & Hamlins
Maximum protection
Choose a main contractor early on in a project to prevent problems later
What is early contractor involvement?
A procurement model whereby the main contractor is selected early in the preconstruction design process so as to contribute to design, risk management, programming and finalisation of prices before the project begins on site.
What are the benefits of early contractor involvement?
A 1998 Construction Industry Research and Information Association report concluded that it results in improvements to teamwork, programming, design, specification, care of the environment, budgeting and management of risk/value.
Does early contractor involvement give the client a fixed price?
Yes. This is achieved by pre-agreement of the main contractor’s profit and overheads at the time of its selection, followed by compilation of fixed prices for each element of the project achieved through further competitive processes to select the required subcontractors and suppliers. Research has found that two-stage tendering is most likely to produce predictable costs (namely, 82 per cent of projects successfully delivered within plus or minus 5 per cent of the quoted contract price).
Shouldn’t we leave design to the design consultants?
Architects and engineers are the natural design leaders, but the main contractor can work alongside the design consultants in establishing ‘buildability’ and in the value-engineering of design to achieve the client’s budget.
How do subcontractors and suppliers react to early contractor involvement?
Instead of bidding to a main contractor, which is itself bidding for the project, subcontractors and suppliers submit prices for review by
a pre-appointed main contractor with the client and design consultants. This greatly improves their chances of a successful bid and encourages competitive quotes and added-value proposals.
Can clients obtain lower quotes under single-stage tendering?
Maybe, but these often hide consultant errors and omit detailed contractor calculations, giving rise to later claims for price increases. Early contractor involvement can obtain more reliable savings by ensuring joint examination of risks and costs ahead of start on site.
What contracts provide for early contractor involvement?
PCP2000 sets out the processes required to implement conditional early contractor involvement, and has been used to generate significant cost and time savings with very few claims or disputes. JCT and NEC contracts can also be amended to achieve two-stage early contractor involvement, for example by adaptation of the JCT pre-construction agreement.
Can early contractor involvement improve sustainability?
Yes. Evaluation of main contractor and subcontractor sustainability initiatives needs their input alongside the client and its consultants during planning to identify the most efficient interpretation of consultant designs. In a two-stage process, the client can establish the relative cost and benefits of sustainability initiatives and make a decision before agreeing price and authorising the project to proceed.
Have your say
You must sign in to make a comment