P.O. Box 3037

Barrington, IL 60011

Tel:(847) 304-7733

Fax:(847) 304-7808

The High Price of Low Cost Construction

Building Project Scenario

You receive 3 estimates from contractors and one is lower than the other two - significantly lower - what do you do? 

Do you take the lowest estimate and forget the other two? 

Sometimes there is a high cost associated with low cost construction - a cost that YOU pay. 

Realistically speaking, every contractor has overhead and would like to make some money on the job - these costs are factored into the total estimate price.

Assuming that the materials for the building project are equal for all contractors, the remainder of the costs are in overhead and profit. 

This would mean that the lowest price bidder has very low overhead and minimal profit. 

The profit is markup and this can be adjusted but considering the costs of running a business, insurance, equipment etc.  A contractor should be making money to keep in business.

The overhead can only be adjusted by cutting corners on equipment, skilled labor and general costs. 

What does this mean for you?

Perhaps the contractor is using low-cost labor - these are usually illegal workers, lower-skilled workers or both.  This practice only serves to hurt your project - lack of carpentry knowledge spells failure - lack of knowledge in English means communication problems and misunderstandings - again hurting your project.  Illegal labor also means that taxes and insurance are not paid and therefore you are indirectly hurting your community while the negligent contractor profits from an ever-increasing problem.

Perhaps the low-cost labor can accomplish what some for the high-cost equipment does?  Not really. 

Think about  a simple scenario: Let's take the framing of a wall.  Hammering nails with a hammer may work but compare this task done with a nail gun - you have significant time savings using the nail gun.  This same principle can be applied across the board whether you are digging a ditch or putting finish trim on a house.  The right tools make the job go faster as well as more consistent and tools cost money which is part of the overhead but the time savings pay dividends when the hours add up...

Last but not least, perhaps the contractor will cut corners (no pun intended) on the actual materials - which is more common than people would believe.  There is nothing more devastating to a homeowner than hiring a contactor that masks problems rather than fixes them.  The initial price to “fix” the problem may be low but these problems only reappear at a later date when the contractor has been long gone and the cost and aggravation to the customer are now significantly higher (see picture below).

The Bottom Line

Ask for a detailed estimate - know where the costs for your building project are coming from.  If the contractor hesitates, move on no matter how good you think they are - this is a sign that they either do not know what they are doing, that they are hiding something or worse yet - they are just plain lazy.  None of these traits make for a good contractor.

Pictured Above: A cover up job and a bad wall.  This problem job was encountered when the customer requested a kitchen remodel.  Upon examination it was noted that the inside wall was actually a wall on a wall...After removal of the siding it was noted that the project was a cover up job.  Note the absence of a header for the previous window.  This cover up was performed by a "reputable" Barrington, IL contractor. Instead of correcting the problem, the contractor chose the easy route and did a cover up.

Often customers are unknowingly faced with cover up jobs.  Cover ups often occur where price is an issue - the customer goes with the low bid instead of investigating the price differences.  Ask the contractor what he/she is going to do for the money - do not settle for unclear explanations.  If language is an issue, move on - miscommunication begins when people do not understand what you are saying.

BUILD AMERICAN!

Should you have any questions or concerns about picking a contractor,

please do not hesitate to contact us. 

General & Carpentry Contractors

P.O. Box 3037 Barrington, Illinois 60011

Tel:(847) 304-7733 Fax: (847) 304-7808