GENERAL CONTRACTING

General Contracting is a traditional construction delivery method in which the project Owner first engages an Architect and/or Engineer to develop the project design and define the scope of work. The design team prepares plans, specifications, and bid documents intended to outline the project requirements.

Once the design phase is complete, a Contractor is selected through a competitive hard bid, select bid process, or negotiated fee arrangement. While this method offers pricing transparency and a clear separation between design and construction responsibilities, the accuracy of cost and scheduling is dependent on the completeness of the design documents, and changes may occur if elements of the scope are not fully defined at the time of bidding.

Methods of Contractor Procurement

Competitive

Price-driven selection based on completed design documents.

Hard Bid

The project Owner advertises for bidders and accepts the bid from the lowest qualified bidder.

Select Bid

The project Owner, often based on the Architect / Engineers’ recommendations, selects a group of contractors to bid on the project. The lowest qualified bid is usually accepted.

Key Considerations

  • Potentially more risk for Owner
  • More risk for Contractor
  • Sets up an ADVERSARIAL relationship among Contractor, Architect / Engineer, and Owner
  • Contractor must select lowest cost bids to receive contract and protect its self-interest
  • Changes in the work are made for any inconsistency or omission to the plans
  • No contractor involvement during planning stage
  • Price and schedule are the deciding factors
  • Makes the assumption that the quality will be the same no matter who works on the project. Contractor has no choice but to select the low bid subcontractor or risk not getting the job.

Negotiated

Relationship-driven selection focused on collaboration and value.

Direct Negotiation

The Owner negotiates directly with a single Contractor selected based on experience, trust, and past performance.

Multiple Contractors

The Owner may engage in discussions with more than one Contractor before selecting the best overall fit for the project.

Key Considerations

  • Potentially less risk for Owner
  • Less risk for Contractor
  • Sets up a TEAM relationship among Contractor, Architect / Engineer, and Owner
  • Contractor can work with Owner to emphasize quality, service, and the best interests of the project
  • Changes in the work are generally made in plan development
  • Heavy involvement of contractor during planning stage
  • Decision based on experience, quality, reliability, on-time completion schedule, creativity, customer service, and price are factor
  • Choose subcontractors on the basis of work and track record