Understanding Bids, Quotes, and Estimates
One of the major difficulties for remodeling contractors working with clients is that they rarely have what to expect mapped out completely. This can impact the final cost of the renovation.
When looking to remodel you may have requested bids from construction companies. Unfortunately, bid is an uncertain term that can lead to misinterpretation. Is a bid just like an estimate? Is it the total spent? There can be some confusion between what homeowners think a bid includes for their job and what they will ultimately get.
Contractors often visit owners that haven’t decided on all the little details. For instance, in a kitchen rebuild during the first meeting it is uncommon to have all the counters, flooring, or other building materials selected. However, a bid is wanted right away. You may get a wide range of prices because there are so many unknown factors that make it hard to give a specific cost.
A respectable organization will create a budget and use disclaimers to manage anything left uncertain. Although, some companies will exploit this by presenting an extremely low offer to amaze the property holder but later come at you with change orders to include things that weren't established initially. The homeowner can end up spending more than they would have if they’d gone with a more thorough, slightly higher offer from the respectable organization. This is a major issue in the remodeling conversation. Clients think they are getting a very exact offer, while the remodelers think they are giving a good general idea as a starting point. This miscommunication causes irritation, uncompleted plans and a ton of lost time for both parties.
Ways to prevent this issue:
- A contractor should consider his first take at giving you a cost an estimate, that is all it should be until the project is outlined enough to offer a firm quote.
- At the first meeting or shortly after you should be given a spending plan or a generalized estimate.
- As the design phase gets further in and more decisions are made, you can request an updated estimate. If you do need custom sketches, then the final quote isn’t set until the drawings are finished and all the materials are chosen or there are terms set for any remaining purchases that are approved by the contractor and homeowner. Now a contract can be made, and you know you have a solid quote.
Property holders need to realize that a quote isn’t precise before a remodel is totally planned and itemized. The difficult part for a homeowner is that the first estimate is frequently called a bid, but that cost doesn’t truly tell you which contractor is the best deal. That can't be known until more decisions are made. The beginning estimates are great for getting an idea of the project’s cost and setting a budget for the entire job.
The best system is to get a good idea of the project costs from bids, then go more in depth on details and prices with a select few. Once you’ve found a pitch for a spending plan that is doable, then make sure the contractor is willing to finalize the details and keep the specs within that range.
Clients tend to hesitate to discuss spending plans, however it’s more effective to work with a contractor and offer thoughts regarding budgets from the start. To do this you have to seek out a contractor you can build a rapport with. Create an interview question list for your specific project needs based of your research.
The objective is to get all the project specifics and choices set as firmly as you can so your contractor can give you the cost for the entirety of the remodel – a number that won't change unless the homeowner adds new work to the job.
Coming up with a cost for a renovation can be uncertain. As choices are made during the job, the cost can increase from that generalized estimate. Since the contractor has to fill in the blanks about your preference for building materials it isn't until further in that the price is completely set. This is something known in the business as scope creep – the common occurrence for jobs to gain in size and scope as they develop. If you keep this in mind from the start, you’ll be prepared and won't encounter the irritation that can be part of looking for remodeling bids.