While hard bidding complete construction drawings is often how pricing for building construction is secured, a Request for Proposals (commonly referred to as an RFP) is typically how prices for feasibility studies, design work, and other construction planning and monitoring services are solicited. The cost of proposals based on these RFP’s is significantly inflated much of the time, and it’s not the provider’s fault. It’s usually because the owner requiring those services issued a poorly planned RFP.
Just as specifying the right equipment has a significant impact on the price of building construction, getting the right price for feasibility studies and other planning services hinges on clearly defining the services that are required in the first place. Services can often cost two or more times what they’re worth, and that cost can often be traced to an RFP that wasn’t clear, or even well thought out.
How can you get the right price for the feasibility studies and other services required to properly plan a project? Here are some tips.
- Establish a reasonable budget for the services that you need before issuing the RFP. Ask yourself, how much am I willing to spend to find out what I need to know? Don’t rely on the costs proposed by the vendors to establish the budget. They may have misunderstood your real needs, or have their best interests ahead of yours.
- Clearly define your objective, and request only that information that you need to make an informed decision. You can always expand the services later if you find that more information may subsequently be needed.
- Carefully consider the deliverables you’re requesting. Don’t ask for expensive presentation materials, or numerous copies, that you don’t need, or can be provided later if you do.
- Separate the ‘must have’ from the ‘it would be nice to have’ information.
- Some of what you’re requesting might seem easy to provide. But do you want to pay a premium for a professional to simply repackage something that you could do for much less cost
- Some of what you’re requesting might be easy to provide, but can essentially transfer the responsibility for its accuracy to the provider, and raise your cost for the provider’s assumption of that responsibility.
- If you’re not sure about the level of detail that you will need, request only the basic information and add more detail later if it’s needed.
- Be brief, and don’t be too wordy. It’s an indication that your focus is not as clear as it should be. And don’t ask for information, or details, that you don’t need. The cost of the study is often a direct reflection of the length of the RFP.
If the price for your proposals seems higher than you think may be necessary, or if you have concerns before you issue your RFP, McKenzie-Douglass would be pleased to review it before you do to see if it’s likely to yield the best results. If you’re in doubt, we can even write it for you.