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There are many different strategies targeted at managing and reducing building costs during your project. Unfortunately, many of them also involve making compromises - such as choosing cheaper selections, reducing the building footprint and cutting back on some of the luxuries you’d hoped to include in your newly renovated home.


To us, this isn’t just cutting costs – it’s cutting down your dream. So, what if we told you that there was a way to keep your project firmly within budget without having to sacrifice the special features that define your dream home?

You may have heard of a negotiated tender before and we’re going to show you how engaging your builder through a negotiated tender process is the ideal way to manage project costs for your next architectural build.

NEGOTIATED TENDER VS. TRADITIONAL TENDER PROCESS

A traditional tender process involves inviting several builders to review your design plans and offer a total cost for the completion of your project. While this is the more common option, it has one glaring flaw – builders will often feel that to compete for the job, they must quote a price that is unrealistically cheap. The client may choose the cheapest quote, only to find that it compromises the scope of their project further down the track (in hidden exclusions, PC sums and specific wordings – and the final price after you’ve signed a contract isn’t so cheap after all.

Alternatively, a negotiated tender involves engaging one carefully selected builder from the outset of your planning process and working with them to settle on agreed terms for your building project. Openly discussing your project goals with your architect and builder, including the finer details and specifications, grants them a comprehensive understanding of the scope of your project. From there, you can work together to devise a plan for how you will bring this vision to life within the constraints of your budget. This guarantees that pricing will be transparent, as your builder isn’t trying to compete by providing the lowest tender – removing the risk of unexpected costs detonating your project.

KEEP CONTROL OF COSTS

Ideal for high-end speciality builds, negotiated tenders can reduce the time and cost of traditional tendering, allow for early supplier involvement, and give you the confidence of working alongside an experienced professional. Engaging your chosen builder from the outset not only allows you to mould your vision to your budget, but also ensures your project will get underway quicker without the need for negotiations with the builder, trades, and consultants once plans are complete.

We recommend keeping your builder close from the design and ideation stages of your project and throughout its construction. This will allow you to ensure that costs are managed without compromising your original vision. You can reduce unnecessary costs by pricing at concept design, so that your architect doesn’t have to make changes that aren’t allowed for in their fee. Pricing before town planning submission also ensures that you don’t waste time liaising with the council and aren’t required to re-submit for an amendment if there are updates to the exterior due to pricing constraints. Finally, engaging an engineer for the preliminary design and obtaining a soil report will give you peace of mind that the footing details are accurately priced in your preliminary pricing. Following these steps during your negotiated tender will increase the likelihood of the final price being within 10-15% of the desired budget before final documentation – allowing your project to commence quicker and earning you significant time and cost savings.

CHOOSE THE RIGHT BUILDER FROM THE OUTSET

Carefully selecting a builder with a strong reputation and proven experience in your type of project is essential to a successful negotiated tender process. As someone you’ll be relying on to interpret your architectural design plans and devise solutions for keeping your dream project within budget, a high level of expertise is key. Something to keep in mind – larger-scale builders often find it difficult to complete smaller projects due to the increased overheads that come with their admin structure, so be sure to discuss whether your budget meets their minimum job size.

A negotiated tender is a collaborative experience, during which you’ll be relying on your builder for expert guidance from the outset of your build – so it’s important that you choose someone you feel comfortable working with closely.

Overall, involving your builder from the beginning stages of your project through a negotiated tender is the best way to manage costs during a high-end build. Get in touch with Tim and our team at TCON for further advice on how to build a high-end architectural home with a negotiated tender.


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