PRICING & COST DIFFERENCES
The actual bottom line cost of your particular project will depend on many factors. Will you be using custom or stock items. What are the existing conditions. Where is the location of the project. Will there be difficulty in getting materials to the site, are you using a fully Licensed & Insured Contractor etc. You can talk to several different contractors and receive several different prices. We have outlined some very important concerns in the pricing area below.
In most cases the contract with your general contractor will be the single largest cost item in your remodeling budget. A good professional and fully experienced contractor can bring your project in on time and within budget saving time and money. A poor inexperienced contractor can be responsible for long delays and cost overuns, costing time and money. When it comes to renovation and remodeling work, the success or failure of your project directly rests on the skill and integrity of your contractor for the most part. It is critical to select a fully licensed and experienced contractor who is completely familiar with your exact type of alteration project. You must consider the reputation, relevant experience of the contractor, his team members, and the services they offer.
Experts say that there should not be more than a 30% difference in price between contractors. For the most part, we agree with this theory. However, this is providing that the contractors you are considering are providing the same quality of work, the same level of professionalism, and the same type of supervision by a truly qualified individual on site throughout your project on a daily basis. This also assumes that they are all playing on a level playing field by doing business legally and ethically. It assumes that they are not misleading their perspective clients in any way in regards to their company and the work that they claim to do, or have done in the past.
Professional Services Inc. is a company which is fully licensed, fully insured, and pays it's taxes. There are many contractors who are unlicensed, uninsured, and do not pay taxes. These individuals or companies can afford to charge 25% to 55% less than a true legitimate professional contracting firm. Having looked into this very issue, we know that if we do not pay taxes, liability insurance, disability insurance, and workmen's compensation insurance our profit margins would be twice to three times as much, or our pricing to our clients would simply be lower. Also, in comparing prices you must make absolutely certain that your are comparing apples to apples. Know exactly what materials are to be used for every aspect of your project. A real professional will put in writing exactly what is to be used down to the last detail and model number. In life, you get exactly what you pay for, and in the contracting industry this means the materials which are used to complete your work as well as the professionalism and integrity of the individual or contracting company which you are dealing with. Remember, the lowest price isn't always the best price for several reasons.
Our contracts state with pinpoint accuracy, what is, and is not, included in the work, so there is no "change order game, or additional charges." We list every stitch of work that we are about to do for you in our contracts. We also insist that before you sign our agreement that you or your attorney review it and discuss it thoroughly with us to be certain that everything you desire is in the agreement. Many contracts prepared by the average contractor are simple one or two page documents that are ambiguous or vague. They can be misleading, so it is critical that you make certain that everything in your contract is spelled out 100% accurately and all inclusive prior to signing it.
Our staff is highly experienced at each task they perform. They have been fully trained for each specific type of work that they are about to complete for you, and have performed these tasks over and over, again and again, for many years. We expect nothing but top quality work from our staff, which they are fully aware of and happy to produce. Quality and craftsmanship costs money. Having a helper or so-so carpenter install your finish trim and moldings instead of a trained and fully experienced master carpenter saves a company a bundle. This is especially true if an unethical and/or poor quality contractor knows that someone else is coming in behind him to do other types of work which tie into his trim installation. The quality problem gets passed onto the next guy (which in this case may be the painter) who has to fix it to get his portion of the work to look right. Professional, Reputable and Quality conscious contractors simply make sure that every single portion of your work is done to the highest level of craftsmanship humanly possible by the most qualified individuals on the team.
Some so called contractors use what is called Day Laborers. Day laborers are workers who are not regular full time staff employees. They are workers who are picked up off the street at certain particular pick up spots and used by the contractor to perform what ever task they may have some slight experience at on your project. Using this type of labor is just like rolling the dice and trying to get lucky. The use of Day laborers also allows the contracting company who uses them the liberty of not having to pay certain insurance on their labor. This is great for them, but not so good for their clients.
Unethical contractors of this nature are blatantly misleading the public and breaking the law. When caught, they will pay the consequences. The proper agencies are cracking down on these illegal operations by shutting them down, and confiscating their tools and vehicles. Should one of these contractors be in the middle of your job and get caught either by accident or because someone reported them for not operating under the law, you are the one who will suffer. Think twice before you base your decision on which contractor to hire on how much it costs. These types of contractors will always be much less than a real company who operates within the law and has all required items necessary to complete your project for you.
Day laborers can not be held accountable for the work they do on your renovation project simply because they are not full time regular staff employees. They are only present on your job when needed. In many cases, contractors who use Day Laborers end up having different people working on your job each week, or every few weeks. Even in the case where you get lucky and have these same day laborers on your project every day throughout the renovation, the overall quality and craftsmanship leaves much to be desired. Also should one of these individuals get hurt or have an accident on your property during the course of them performing any type of work on your project, you and you alone will be held responsible and can be sued for his or her injuries. The contractor who brought them in does not own the property, you do, so you are responsible.
Contractors who do not charge appropriately for their services will not be around for very long. In many cases, the average contractor is not business savvy enough to know that they are not making a profit on the work they do for their clients. Just about every so called contractor knows how to figure out direct costs. However, most of them really have no idea on how to account for profit and overhead, or how to apply an appropriate markup to cover their insurance costs, and all other associated costs which are part of your bottom line number. If these so called contractors were operating legally and had even a clue as to what they are doing, their end prices would simply be much higher and the industry itself would have a better reputation. In this case the 30% differential would apply.
Unfortunately, there will be many who read this information who will not allow it to sink in simply because their only concern is how much they pay to have their work done. At the very least, they will put much more emphasis on the bottom line price than any of the other factors which truly outweigh costs. They will insist on believing or hiring whoever gives them the lowest price. They may even get two or three prices from unethical, inexperienced, inadequately trained, and poorly skilled, so called contractors which are pretty much in the same price range and say to themselves, well, three contractors gave me just about the same cost, so it must be correct. Sadly, many of the companies out there posing as contractors, are really not contractors, and the numbers of these types far exceed the real professional contracting firms. It is quite possible to get three bids from amateurs who do not have the proper insurance coverage, proper required licensing, or the true knowledge, skill, proper work ethics, and years of documented work experience of a legitimate contractor.
Some so called contractors even go as far as to forge licenses, insurance certificates, etc. to show proof that they actually exist and are in force in either the individual's or company's name. Others use the licenses and insurance certificates from underhanded, greedy, licensed contractors and pay them a fee to let them use their paperwork. The bottom line is, that you must do everything in your power to check references of those who portray themselves as a contractor. By not doing so, it is quite possible to literally waste the money you do spend on your project by going with the lowest price theory. This is simply because in the end, your completed project is nothing compared to what you desired, imagined, or were told you were going to receive. To add insult to injury, your journey in dealing with your unprofessional illegitimate contractor to get to the end of your finished project, could very well end up being a nightmare. We strongly suggest that if you do not have enough money in your budget to remodel or renovate at the particular time you wish to do so with a true professional contracting firm, you should simply hold off and wait until you do. It is better to hold off rather than hire the wrong company just because their price is lower and you think you can get the work done right away.
We have posted this page in an effort to open your eyes and raise awareness with consumers in regards to the entire pricing issue picture. It is our belief that an educated consumer is armed with the proper tools to make the right decision in their contractor selection process. We have also posted some articles which discuss this area of concern. Please see what others are saying by clicking the links below. Should you have any additional questions or comments concerning costs, please do not hesitate to Contact Us.