When request bid from General Contractors my SOW stated bid to include everything from gutting to buy materials and rehab per plan. BP member's suggested the bid to separate for labor and materials. I was surprised by my GC's final bill line item called miscellaneous (which is not labor nor materials), this include dumpster rental and porta potty. The cost of this item is few thousand that my team didn't budget for, but I would think as a contractor he would have an idea on long he need the dumpster / porta potty.
Before I get all the contractor mad I at me, I did paid in full. I wouldn't want his worker have to pee in the yard or mess up the new bathroom :) But this leave me wondering, was it something I missed in my SOW? Shouldn't dumpster and potra potty rental be include in the materials?
Maybe I need a statement that covers EVERYTHING?
I think if you expect the GC to include every line item you're going to limit your self to GCs who won't do the bids for free anymore. That's an awful lot of work to expect them to complete before they even get notice of whether they get the job or not.
I wouldn't include porta potty or dumpster in materials. When it comes to tax time I know that contractors may or may not have to pay sales tax on material depending on who and how its paid for. Since the porta potty and dumpster doesn't increase the value of the home they seperate it out.
If you're hiring a good GC I think you need to give him a little more faith in his work. As an outsider it sounds like maybe you're trying to micromanage. If you feel you need to micromanage you need to do a better job of either trusting your GC or finding a better GC you can trust.
I agree with everything @Steven J. said. Very wise.
Sounds like simple miscommunication. I would recommend amending your contracts to reflect "Turnkey" and add language that final bid amount will be amount paid, any and all added charges or change orders will need to be approved and in writing.
I would disagree with the above comments a little bit. My W-2 job requires that I find, hire and manage general contractors for small commercial projects ($1.2-$1.5MM) and I get 3 bids and select 1. I NEVER pay for these bids and I expect them to be accurate and all inclusive. That is the cost of doing business in this industry. If they do a great job and there are no significant issues on the next job I will let them bid first and if it is inline I do not necessarily rebid it, but I may ask them to get multiple bids on certain subs. Until you have a history and a very good relationship it is your responsibility to micromanage. Once you have a history and a very good relationship it is still your job to manage.
You are paying a premium to have a general contractor and with that you should not be surprised by known expenses, and porta potties and dumpster are known expenses. With that said there is always a learning curve for both sides and those situations provide opportunities to "build your relationship". I would have addressed it head on with him and let him know you do not want surprises and this was a surprise to you. Explain your side and hear his side and then come to a compromise. I would have had him split the cost with me.
All that said, you are doing better than me being able to afford a GC for our rehabs! I need to buy better!
I can not micromanage GC and I don't need every line item is necessary. I will consider adding what Keith suggested "turnkey" wording such as " final bid amount will be amount paid, any and all added charges or change orders will need to be approved and in writing." Usually I do what JScott suggested, if it's less then $200 materials please go ahead and do right.
I have biz partners/investors to communicate to and things are budgeted, if something jumps out on the final payment is not very professional. Like what @Katie Neason said if it's known cost it should be included. Of course if GC open the wall and realize something wasn't supported correctly, additional man hours and materials is needed > $200 a quick call would take care of this.
My latest project we discovered friable vinyl tiles under the carpet!!! Later test confirmed it's positive for asbestos. this is not covered by the SOW :-)
If my team keep on using the same GC over and over we'll have better understand with each other.
@Katie Neason , due to liability my team always uses GC.
@Bob T. There is an important line that needs to be added to the start of every scope of work " including but not limited to". No need for line items you should already know your material cost and they should be selected for your contractor to save him time and you both money. Spec sheet should include location in the property, aprox sqft, sku number, price, store etc. as stated before don't make your contractor do paper work you want him running and managing your job.
I have done very large commercial projects and every separate scope of work in the giant spec book starts with " including but not limited to"....,
Dumpsters and porta-potty are common expenses and easy to forecast. If the GC gave you a bid, these should have been included. Leaving them off the bid but including them in the final invoice is not something I'd have been happy about.
Sounds like a simple miscommunication, but maybe he missed it in his bid and is trying to get it back on the back end...
Simply saying "Everything" is to vague of a statement if you ask me...
To avoid this issue on future projects, it's probably worth adding a line item that specifically states who is responsible for Dumpsters...
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