First, let’s be truthful and realistic: there simply is no cheap, easy solution to commercial construction. By definition, building a facility for business operations is going to cost money, regardless of the delivery system you choose.
But, hear me now: the #1 way to reduce commercial construction costs is to stay away from the lowest bidder.
Yes, you heard me right. The philosophy of “get at least three bids and then go with the lowest” just does not work in today’s marketplace.
Why not? The supply of qualified construction providers does not meet the current market demand. Well then, what does work to manage costs as tightly as possible?
The second factor in managing and reducing costs is this: hire your construction partner very early in the process—either as the design is being developed or at the same time you select your designer.
I’ve seen it happen over and over again as months and dollars are wasted as clients spin their wheels because they don’t have the right people at the table from day one to help design the project practically and feasibly.
Here are 6 more fundamental ways you can control and reduce construction costs:
Spend time and money on the master plan of the property to accommodate future growth. I’ve seen short-term thinking cost clients a lot of unnecessary money over the long-term.
Be clear with your design team on what is financially feasible. Be realistic from day one.
Get schematic budget estimates (not bids) as the design progresses. If your contractor cannot do this, you may be in danger. Pay for this service so you can track your costs as you go.
Don’t move too fast. The design process can take many months and, if carefully undertaken, will save you thousands of dollars over the life of the project.
Don’t move too slow. Construction cost inflation is real. Time can cost you money because prices for materials and labor can and do rise more quickly than you might realize.
Spend money on due diligence and do it soon. This can avoid you having to move too fast.
In short, your first and best opportunity to reduce construction costs is in the design stage. Good, early planning will serve you well, as they are no bargains or discounts in the construction phase.
And remember this important piece of advice…
Stay away from the lowest bidder. You'll get what you paid for.