Blog: Contractor Chatter

Design Build vs Design-Bid-Build Your Two Options

Design build and design-bid-build are the two most common types of project delivery systems for home improvements.  Design-bid-build is where an architect handles the complete design stage of the project.  It is common for a homeowner to think they have no choice, but to hire an architectural engineering firm to get their plans.  Unfortunately, this is a costly route to take as it has a tendency to lead for other issues.  The challenges involved in designing and building a home improvement project can lead to frustration, sap you of your time, and cause you to overspend.  That is why you need to choose the best project delivery method possible for your next project.  In residential construction, the majority of contractors agree.  One of these two methods is the way to go.

Design-Bid-Build

The design-bid-build process alone causes pitfall number one.  Once the plans are ready, responsibility completely shifts onto the shoulders of the contractor.  Nine times out of ten, this leads to a situation where your contractor will have to work from plans that lack necessary details since hands-on building is typically not an architect’s core competency.  In the residential construction industry, inadequate plan sets are the norm.  They contain inaccurate and incomplete information.  More often than not, this problem is why homeowners end up paying more out of pocket.

Hiring an Architect

When you hire an architectural engineering company you will have to pay a flat-rate design fee, hourly billing, or retainer.  Like a design build firm, they will assist you to define your project and transfer your ideas onto paper to make sure their plans convey your dreams.  They will also discuss your budget with you.  However, in the residential sector they will usually develop your plans without really pricing your project out. This is due to the fact that the majority of residential architects do not know how long it will take or how much it will actually cost to build your job.  This means you can exhaust your design budget by paying for your plans before you engage a contractor.  Some added costs can include: paying a contractor to review your project, develop a quantity survey, and provide you with a written quotation.

Where Real Cost Overruns Start to Creep in

Architects develop plans and then contractors must provide their estimate based on those plans.  Since issues with architectural plans are common place and meeting your construction budget is not your architect’s primary concern, estimates will, more than likely, not meet your budget the first time around.  The cycle begins and you will have to pay your architect for revision work.  The architect will alter the design and this process will have to be repeated until you obtain an estimate which meets your budget goals.  Is that always the case?  No, reports indicate that over half the plans residential architects create per year will lead to a project that will never get built.  This is a result of contractor quotations exceeding the budgetary constraints of the homeowner.  Alternatively, design build is where a single entity combines design and construction services with 100% accountability.

Design Build Contractor

A design build contractor will work closely with the homeowner to help them establish their budget and they will design their project to fit their budgeted investment targets.  Since the contractor is involved from day one, they are able to ensure the design will suit the owner’s vision, lifestyle, and project goals. When you hire a design build company, in addition to your permit-ready plan set, you will get a detailed list of the work that will go into building your project and an estimated project cost .  This project approach has been widely adopted as the better project delivery system for homeowners.   As mentioned earlier, choosing to use an architect involves two stages before building.

You will have to:

1. Interview and hiring an architect
2. Solicit bids to hire a general contractor to build.

The process alone causes design-bid-build to be the more expensive route to take as it involves two companies being paid separately.  This reality has proven to lead to homeowners paying up to 10% more than if they elected to use a design build contractor.

Design-Bid-Build Disadvantages & Comparisons

If you are not careful, the use of an architectural firm can lead to a lack of accountability. This is a result of having two contracts from two separate firms.  Tasks can overlap or may be overlooked.  Also, each party assumes and expects the other to take up a particular role, thus making accountability a challenge.

Other items which merit consideration:

1. Enlisting an architectural firm may lead to poor communication.  This is a result of the parties sometimes viewing each other as opposing factions.
2. The architectural firm and contractor work separately.   This does not allow cost predictions to be accurately developed. When using the design build method it is easier to determine the costs and the feasibility of a project before it starts.
3. Residential architectural firms do not usually get involved in building their client’s project. Their designs are final even though they will not be onsite to offer further assistance. On the other hand, a design build contractor will be present till the very last second on your project.  They will also make themselves available to discuss any design changes at no cost to the homeowner during your home improvement.
4. Architectural firms lack contractual continuity when undertaking a project. Alternatively, a design build contractor will be involved in a project from start to finish. This limits the number of errors made during the course of the project.

If you are looking to improve your living space, the best delivery system is the design build method. It is plain and simple. Design build leads to better results.