The Contractor's Role in Building Cost Reduction After Design (Bringing a Project Into Budget)

摘要

Having a building project fully designed, let out for bids, and then discovering the low bid is over budget, can be an extremely discouraging experience for an owner. It can also be costly for a building contractor to spend the time and effort required to submit a bid and not have the project awarded because of over budget issues. Many projects have been successfully brought into budget through negotiations between owners and building contractors after design. The intent of this article is to stimulate contractors, owners, and design teams to work together to find acceptable cost saving solutions and alternatives to bring projects into budget. This paper examines some of the avenues building contractors can use to reduce project cost. The use of value engineering, scope reduction, and scope deferral are methods that are discussed. The importance of the building contractor establishing a relationship with owners and design teams based on trust and openness is also discussed. Emphasis is placed on examining the various components and systems within a building project through the work breakdown structure (WBS). Three different types of building projects that were successfully brought into budget through this process are also illustrated. With the continued growth in construction activity and inflationary pressures in most regions of the country, the incidence of building projects coming in over budget is not expected to cease. Owners are not limited to abandoning their projects or costly redesigns. In many cases, project cost can be lowered through careful analysis of building components and systems by the building contractor working with the design team. The increased value that could be gained if this cost review process was performed in the early stages of the design is recommended for future research.