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Don’t charge ahead of the Inspector’s inspection

· July 17, 2020

Sometimes contractors think they know what inspector’s will approve only, to be proven wrong. Over the years we’ve learned to appreciate inspectors. Here’s an example of why you don’t want to let contractors charge ahead of the inspector’s inspection.

On one one of my projects, plans called for the electrical subcontractor install electrical conduit and floor outlets in an existing concrete slab. In a meeting, the subcontractor, Tony, admits he was late scheduling the inspection. It means it’ll be another two week before the inspector comes out, creating a delay.

To stay on schedule he says, “I’m going to have my guys go ahead and patch the slab so we can keep moving.”

So I ask, “What’s going to happen when the inspector can’t see the conduit?”

“Don’t worry about it,” he says, “I know the guy; it won’t be a problem.”

We monitored the installation. We knew it was installed per code, but the city inspector has the authority to reject installation. And I’ve met with enough inspectors to know not to assume anything so I say, “Look Tony! You can patch the floor if you want, but you’re doing it at your own risk. The owner won’t pay for you to redo it, if the inspector doesn’t approve it.”

Tony agreed. Because he was was moving so quickly, I wrote him an email that same afternoon summarizing our conversation and agreement. Then I rescheduled the flooring installation to happen after the inspection.

A couple of weeks later, the three of us met on site for the scheduled inspection…

Everything went fine until the inspector saw the new conduit floor patch, and that’s when he said, “Tony, I can’t tell what kind of conduit you installed.” Tony tried, to explain, “We were in a hurry Joe. It’s 3/4″ conduit per code, like we do everywhere. You know our work.”

But Joe stuck to his guns. “Things have changed, and I can’t see it. You’ll have to cut it out and reinstall it, so I can see it,”. Which is exactly what Tony had to do.

A couple weeks later we had the inspector back out after Tony ‘s guys reinstalled everything, and he approved the installation. Then we patched the floor and installed the flooring.

Tony couldn’t have been more wrong. He had to fix redo that work or we would not have gotten the occupancy permit, which would have delayed the re-opening.

If we had agreed with the subcontractor and approved patching of the floor, we would have been responsible for the cost of redoing that work.

The subcontractor didn’t like it, but because he agreed to charge ahead of the inspector at his own risk, he had to pay for it when it was not approved.

Always wait for the building inspector to complete their inspection before proceeding. There is much more information in Construction Conductor about inspectors, what they look at and when to use them.

Major cities often have in-house inspectors, which can lead to longer lead times due tot eh limited number of inspectors. Cities too small to have in-house inspectors, use companies like Bureau Veritas to support the building department. Contact the building department in your city for more information on your project requirements.

Categories : Commercial, Construction

What’s the best way to pay laborers?

Posted by Richard Cartright

· October 31, 2019

Trade contractors generally pay laborers by the hour, or by the piece installed on a weekly or biweekly basis. Let’s look at the pro’s and con’s of each.

By the Hour:
Pro(s) – Laborers are paid a rate per hour for the time they work, capping their cost and making it easier to control the amount of hours employees work. Some workers will want to work as many hours as possible.
Con(s) – Laborers are generally paid an additional 1/2 time the rate for overtime. The employer needs to monitor the performance of the worker and watch the hours to make sure that the laborers work consistently and continuously.

By the Piece:
Pro(s): You only pay them for the units installed, regardless of how long it takes someone to complete a unit.
Con(s): When paid by piece, employers needs to watch to make sure the guys don’t blow through the material and claim they used more than expected. When workers are paid per piece, they are not necessarily the most careful or do the best job, and they are often nowhere to be found for the little corrections that are a common part of what we call the punch list.

Generally, laborers like to be paid on a weekly basis. When they know they are getting a steady paycheck every week they are more likely to continue showing up. Laborers have been known to go from one employer to another for the same pay, just because the new one pays more often. While it’s easy to feel like laborers don’t care about anything except getting paid, as much as possible – it’s important to remember that many really do care about doing a good job. You just have to take the time to make sure they understand the expectations.

Categories : Construction, Construction Management

Sometimes Going Forward Takes Compromise

Posted by Richard Cartright

· June 30, 2016

People have different reasons for wanting to get something built. Usually, there is a disconnect between what they want to build and what they can afford to build.

Recently a friend was working on a project for a non-profit, where the design committee had stated that the project budget was 20 million dollars.

Monopoly houses The project was well into designs and the design team had put together a beautiful looking project. The cost of construction was estimated to be about 18.3 million dollars, all in. The team felt great! They had successfully designed a beautiful looking project well within budget, or so they thought.

Then, literally an hour before the team went to present the project to the city board, the donor told the team the donation would be five million, not the budgeted amount.

They asked me to help figure out how they could get the entire project down to five million, so we spent the weekend crunching numbers and whittling away at the project.

That following Monday, we presented the list of suggested cuts which included reducing the square footage of buildings, reducing ceiling heights, re-positioning buildings, combining spaces, and using different materials. It was all budget driven, but the owner was still not at all happy with all the suggested cuts.

Realistically, the owner can get all of the necessary project functions into a project that will cost five million, but taking any project from 18 million down to 5 million, will drastically change the project size, scope, and quality. In the end, it may have changed everything so much that they don’t build anything resembling what they wanted.

The worst part is that now they have a design that they cannot use, have purchased land they may not use, and have spent upwards of one million dollars on everything to date.

In every project, it is of utmost importance that the people responsible for design and those responsible for funding, are on the same page.

In this case, the design committee never wanted to have the donor involved or informed, and had no other relevant donors. They were setting themselves up for a failure and didn’t even know it.

It didn’t have to happen that way. If the design committee really wanted to build something useful, they needed to compromise on the project size, scope and quality. If they couldn’t, they will have wasted a million dollars on a plan they cannot afford to build on property they cannot use.

Categories : Big Picture, Budget, Construction, Planning, Project Management, Uncategorized

Tags : Building Budget, Construction Cost Estimate, Design Your House within Budget

Construction coordination can be tricky.

Painted walls and finished floor.

All physical construction work is broken down into parts such as: carpentry, concrete, electrical, flooring and painting to name a few. The same terms used to describe the parts are often used to describe the trade responsible for executing the construction of that part. Each construction trade’s work is unique. For the vast majority of trade work, the labor must be completed by the specific tradesman. You can’t have a painter install flooring and you can’t have a carpenter run the electricity. However, there are tasks between trades that often overlap and can be handled by either of the involved trades.

Here is a simplified example of overlapping tasks:

Let’s say that you want to get the floor replaced in your house, and you want the house interior painted too. The flooring company installs the floor but can’t do any painting. The painting company will paint everything, but cannot install any flooring, baseboard or quarter-round.

The kind of existing floor you have, determines whether you currently have quarter-round (or base-shoe) in place. It is often less expensive to install new quarter-round than to remove, restore and reinstall the existing quarter-round. For this reason, flooring companies often furnish new quarter-round, if it is needed to ‘finish’ the flooring installation. Sometimes the furnished quarter-round is already color coordinated to match the flooring. Sometimes the quarter-round needs painting to match the walls, and sometimes you get the choice.

You can have the house painted, and then have the floor installed, but who paints the quarter-round after the flooring people install it? You can have the flooring people install the floor and quarter-round before the painters paint, but what happens if the painters damage or get paint all over the new floor while painting? What should you do first? How do you coordinate the work between the trades in order to ensure nothing is messed up or missed?

The best approach is to work with the contractors to schedule the coordinated work between the two tradesmen. Here is a simplified example of how that can work:

If the new quarter-round is designed to match the floor, whether or not the old floor has quarter-round, coordination is really easy. Just have the painters come in and paint then have the flooring installers come in afterward to remove the old quarter-round if neccessary and install the new floor and quarter-round afterward.

If the new floor needs no new quarter-round and the old floor has quarter-round, then include the removal of the old quarter-round as part of the painting prep-work. Then have the painters’ paint before having the flooring people install the new floor.

If the quarter-round needs to be painted, getting everything done requires a little more coordination. Include the painting of the new quarter-round in the painters’ contractual scope of work, this way it won’t add any extra cost to the project later. Ask the flooring company to furnish or let you pick up all the quarter-round in advance. Installers often deliver materials in advance to give the materials time to acclimate to the space’s temperature and humidity level before installation, so getting the quarter-round in advance shouldn’t be a problem. This way you can have the painters’ paint the quarter-round while on site for a cost that has already been negotiated.

Have the painters paint before the flooring installation. The painters should protect all of the furniture and paint as contracted. You won’t have to worry much about the floor if you are replacing it anyway. Once the quarter-round is painted and the paint is dry, have the painters set the quarter-round aside.

Coordinate the work so that when the painting company is finished painting the space and the quarter-round, the flooring company can come in the next day (or shortly thereafter) to install the flooring and the painted quarter-round.

Using this sequence ensures that after the floor installation, all that could be left is a tiny bit of touch up painting at the quarter-round nail holes and cut marks. After the floor installation, if the painters need to come back to the site to paint elsewhere, you can have them touch up the quarter-round as needed. However, if the painters have already completed all their work it will cost more to have the painters come back to do the touch up painting. In this case it is more cost effective to include the touch up painting in the flooring company’s contract scope of work, or handle that ‘tiny’ bit yourself like a GC might do.

For each trade that you add it becomes a bit more complicated to coordinate the individual company’s work. In addition, each project and contractor is unique. Some contractors may be willing to take on more work, while others less. It’s important to coordinate the work during the bidding process, in order to make sure that you don’t pay twice to have the same task completed, or become a captive audience during construction because you forgot to include specific tasks.

Can You Afford a Project Manager?

Posted by Richard Cartright

· March 16, 2012

Many homeowners look at the idea of hiring a Project Manager as an extra, unnecessary expense in their home building project. “After all,” they think to themselves, “I’m already paying an Architect and a General Contractor. Both of them are supposed to be managing my project, why should I hire another manager?”

That’s actually a very good question, one that I hope you’ll let me answer for you. First of all, these three people, the Architect, the Contractor and the Project Manager all have different functions, even though they look like they are all doing some of the same things. We need to understand what the difference between their different functions and different outlook is.

The Architect is concerned about the design of your home. He wants to build you something that is going to make him look good, while providing you with a home that will keep your family safe and comfortable. Although most Architects also claim to manage the construction project, what they’re really doing is making sure that your home is built according to their design and specifications; not trying to save you, the owner, money.

The General Contractor is concerned about how your home is built. More specifically, he’s concerned about how much it costs to get built. You have a contract with him, which limits the amount of money which you’ll pay for his services. So, he wants to make sure that the project costs less than that, ensuring his profit. He’ll do the best possible job, within those parameters. But, when push comes to shove, he’ll sacrifice quality to keep his profit.

The Project Manager doesn’t have to worry about the design or the profits. If you hire a Project Manager, he doesn’t need to worry about his profits, because you’re already paying him to do the job. His concern is that the whole project is completed in the best possible way, in order to make you, the customer, happy.

You see, the Project Manager is the only one of those three who is your advocate as an owner. He’s the only one whose best interests are to look out for your best interests. That makes his focus much different than the other two professionals whom you are working with.

The important thing in getting the maximum benefit from the services of a Project Manager is when in the overall project timeline the owner hires him. The greatest savings for the owner comes from hiring the Project Manager first, even before hiring the Architect. In this way, he can be proactive for the owner from the very beginning, before any other professionals are hired.

If the Project Manager is hired first, he can do the most good. As the owner’s representative, he can locate, interview and negotiate the best possible contract for the Architectural work. As part of this negotiation, the Project Manager can negotiate with the Architect to remove the extra costs associated with contract administration, communication and schedule management out of the Architect’s contract. Since the Project Manager would be handling these functions, there is no reason to pay the Architect for them as well.

By doing things this way, there is no additional cost to the owner for having a Project Manager on their home building project. In fact, since Project Managers typically charge lower rates than Architects, there would probably be an overall savings. However if the Project Manager is hired after the architect, then they are unable to negotiate the administrative savings, so the additional cost would be the cost of the Project Manager, less any savings that they can provide throughout the project. Finally, if the Project Manager is hired after the General Contractor, he is only able to provide damage control. His payment would be over and above whatever other contract costs.

If you feel that you need an advocate, someone who is looking out for your best interests in your home building project, then you need an independent Project Manager. Your Architect and Contractor may be friendly, qualified professionals; but they aren’t your best advocate, the Project Manager is.

Categories : Construction, Construction Management, Project Management, Project Manager, Residential, Residential Construction, Uncategorized

Tags : Construction Management, LinkedIn, Project Management, Project Manager, Project Planning

Watch Out for the High Price of Change Orders

Posted by Richard Cartright

· February 28, 2012

One of the most important parts of managing a construction project is keeping costs under control. Many a project throughout the years has gone over budget, always causing problems, sometimes disastrous ones. Whether you are building your home, or a skyscraper, you can pretty much count on unforeseen costs, which drive the total project price higher.

Let me tell you a secret here about contractors; many of them depend upon those extra costs to stay alive. When they bid the project, they are competing with other contractors. To win, they have to be the one who comes in with the best price, while still promising to meet all the specifications laid out in the plans and specs. That means providing a low-ball price, with minimal profits.

Once the contract is signed and the job has been started, the contractor has a captive audience. They no longer have to worry about beating other contractors to gain the contract; they already have it. So, many will provide a price for those changes that’s a bit inflated, to say the least. They are depending upon those changes to make their profits. This is where it can get dangerous for you as the property owner.

There are three causes for changes on a project:

Something was left out of the plans. While architects strive to prevent this happening, they aren’t perfect either, it does happen once in a while.
An unforeseen problem shows up in construction. This can be anything from adverse weather causing problems, to massive undiscovered rock formations getting in the way of putting in your foundation. The contractor isn’t responsible for them, because they’re not his fault.
You, as the owner, request a change. That’s under your control, so realize that when you do request a change, the contractor is going to try and take advantage of it.

Whereas the original contract will probably have been bid with a profit margin for the contractor or ten percent or less, these changes may be priced with as much as 30 percent profits or even more. While he may see that as an opportunity to make up his profits, it’s fundamentally unfair to you as the owner.

So, how do you control those costs? It actually takes a combination of things to do so. But, by following these items, you can reduce your risk:

Don’t ask for unnecessary changes. If something would be overly expensive to change later, have it done, but if you don’t need it changed, try and avoid giving the contractor that opportunity.
Ask the contractor to give all change orders with a breakdown: so much for materials, so much for labor, so much for overhead and so much for profits. He might still lie, but he’ll have to work harder at it.
Verify prices yourself. If he says that the bigger hot water heater is going to cost an extra $500 to buy, go to Lowe’s and check for yourself. If his costs don’t seem reasonable, ask him to back them up.
If you receive a large change order request, such as finding a large outcropping during excavation, which is going to require blasting; get a second opinion. Even if you have to pay another contractor a $100 consulting fee to give you an idea of what that should cost, it can save you money in the long run.

You have to realize that the contractor isn’t your friend. Hopefully, you’ll be able to develop a friendly relationship with him, but that’s not the same as being a friend. You are a customer, the source of his income. Therefore, he needs to get your money.

This problem is one of the biggest reasons why first time homebuilders will hire a construction manager. Even with paying the manager’s fees, the overall project cost can still come out lower than it would be if you managed the project yourself. Everyone else that works for you on the project is there to make money; the project manager is there to be your advocate. His knowledge becomes your protection.

Categories : Construction, Residential

Tags : Construction Management, LinkedIn, Project Management