One troubling pattern we’ve observed here at A-1 Renovation is that some of the remodeling contractors that bid on jobs alongside us have started bidding below cost.
Presumably their rationale is that short term what’s important is to keep getting jobs and keeping their teams busy. But obviously that’s a tenuous direction that leads to closing up shop.
But contractors aside, here’s the risk for the homeowners with below-cost bids:
Quite often the contractor will start the job, but then opt not to finish the job at a loss. That leaves the homeowner with a half finished project, or one with major corners cut that may not pass code.
The homeowners then have to hunt down a second remodeling contractor to finish the job, which ultimately tends to be more expensive because of what has to be redone to finish everything correctly.
Or, the other scenario that crops up from too low a project bid is the contractor not getting proper permitting or cutting corners that jeopardize the project from a regulation standpoint. We’ve seen the city shut renovation projects down mid-job, even where an exterior wall was open to the elements.
Much like how your driving record can affect insurance rates and a court’s willingness to be lenient with you, working with a contractor with a track record of issues with the city can make it all the harder to get the permitting and work resumed. And much like points on your auto insurance, you don’t want bad remodel work creating discrepancies later should you need to file a homeowner’s insurance claim.
Government Bids Seem To Exacerbate This
Government organizations almost always opt for the lowest bids, sadly regardless of quality. That’s been our experience, and contractors that frequently bid on government jobs know this.
That means that a remodeling company that relies on government contracts is used to having to bid as low as possible and cut any corners possible to deliver at that level.
Government entities also tend to have less of a sense of urgency than a typical homeowner, so perhaps the almost inevitable delays from low bids are not of concern to those making the hiring decisions. Where a homeowner would be leery of a remodel project being in limbo for a few months, government contracts often involve administrative delays.
Our Bids
Bids from A-1 Renovation are the same as they’ve been, which is to say we’re neither the cheapest nor the most expensive. We work our bids to include real material costs and feasible timelines. We quote for doing the job well rather than cheaply.
While it’s a shame to see parts of the industry bidding low enough that their futures are jeopardized, that’s not our practice.