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Old tricks GC's use to beat your price down are coming back around again

CM1995

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Running what I brung and taking what I win
We've been bidding a lot of commercial work mostly retail/service type work with some institutional thrown in amongst the mix.

Sent in my bid on a national tire chain store. Simple ground up construction, 6K SF building, 1 acre site with 500-750 CY of dirt to move, 5-6 inlets and a couple hundred feet of 15" and 8" HDPE. Bread and butter type of job for us in the $125-150k range.

An estimator from one bidding GC calls me this morning to double check if I included the recommended under cut for the slab and parking areas in the geo-tech report. I replied I did not as it was just a suggestion so he said include it as an alternate. No big deal, we do that all the time in order to not throw our base bid out of whack and give the estimators apples to apples to compare to.

During the phone conversation this morning, the estimator said "Just to let you know they (national tire chain) only pays $20 per CY for import/export."

My reply - "$20? (chuckles), That's going to be hard to do".

Estimator then replies - "That's including our general conditions and mark up."

At that point I kindly told him I would get him my per CY number within the hour and then proceeded on the next project. Yet to provide him that number and won't.

Figured I would share this with anyone that may be new to the competitive bid commercial market. The above is an old tried and true method (since they are still using it) the GC's use to beat subs down prior to bidding and selling out a job.

The way it works in some of the bigger GC's estimating departments is once a job is bid and won any savings the estimators can get when selling out the job is a portion of their yearly bonus.

Said national tire retailer is not capping import/export at $20 per CY, the estimator is fishing to see if he can bait someone into taking the price.

The max was $25 per CY back in 2013 for another national auto parts chain we did a HUB store for in the same year. The ruse is this estimator is trying to find inexperienced subs that will take the bait. If I agreed to $20 per CY this guy sells the job to the owner at $30 per CY (or more) plus is 15% general conditions and O&P. All the while we loose money moving their dirt. For reference there was 1,500 CY of UC and replace.

When a site requires undercut and replace with structural fill there are 6 things that have to happen and each item has its own line item.

1 - Excavate
2 - Load in a truck
3 - truck off site for disposal (includes disposal fees)
4 - load structural fill at dirt pit (includes mob'ing a hoe in and paying landowner for dirt)
5- truck structural fill to the job
6 - place, compact and achieve satisfactory compaction tests.

For the record my price for this job was just shy of $30 per CY. The dump site and the dirt pit were within 5 miles of the project for context.

Another trick they use is to "award" you the job if you can cut $5-10K out of a line item. With times getting tighter the scams will only come more prevalent.

Ya'll keep your pencils sharp as there is always sharks in the water.
 
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AzIron

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Jun 14, 2016
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Az
Don't worry we got a lot of projects that we need you for just take care of this one

The other one I really like is when they ask you to take on bs scope that no one wants and if you take this scope for this budget price you get the whole job

I also like the one that is hey we will self perform part of this witch is the gravy part and leave you with the garbage or they split it up between to outfits that's usually when I say we will do all of it or none of it
 

CM1995

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Running what I brung and taking what I win
Yeah the " just do this part of the scope for nothing and we'll make it up on the next one".

Love that one..
 
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skyking1

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Nov 3, 2020
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Location
washington
We end up in the middle of those schemes as the plumbing contractor. Our contracts state "no import or export with the exception of necessary pipe bedding"
We dig up what should be crap and exported and replaced, but nobody wants to pay for that, the dirt guy took one of those deals and the owner(s) won't pay.
We cover and care for the spoils as best we can, and put back some real junk from time to time.
The soil squeeze must be getting a cut because I would never pass some of the stuff we put back.
 

CM1995

Administrator
Joined
Jan 21, 2007
Messages
13,485
Location
Alabama
Occupation
Running what I brung and taking what I win
We end up in the middle of those schemes as the plumbing contractor. Our contracts state "no import or export with the exception of necessary pipe bedding"
We dig up what should be crap and exported and replaced, but nobody wants to pay for that, the dirt guy took one of those deals and the owner(s) won't pay.
We cover and care for the spoils as best we can, and put back some real junk from time to time.
The soil squeeze must be getting a cut because I would never pass some of the stuff we put back.

Pretty much every contract I get the GC tries to slip "haul off of all spoils" which is a catchall they try to rope the dirt guy in to hauling all the spoils off site. I just mark through it and state -"only spoils produced from our scope of work. No haul off of other trades spoils".

On the flip side we usually pick up decent CO's to haul off the other trade's spoils.
 

skyking1

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Nov 3, 2020
Messages
7,790
Location
washington
As long as you get your ~$30 C.Y. that you can work with, it is just a T&M extra that was agreed on at the beginning.
 

AzIron

Senior Member
Joined
Jun 14, 2016
Messages
1,549
Location
Az
I beat one last year that had drilled piers and we owned the export so I quantified it the pm fought me hard on that well they were 40 percent over on concrete cause the piers belled out so bad.

basically i was able to get a decent size CO for extra export it really saved my bacon cause i lost my shirt on some fine grading that lost equipment acess and needed to be done by hand and i didnt get the detail for it in the contract win some and loose some but its a fun game in between
 
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