It’s no secret that construction projects rarely hit their budget goals, and it’s even less of a secret that they hardly ever get completed on time.
This is largely due to the fact that as soon as a construction project starts, all leverage disappears from the owner and is in the hands of the contractor. Contractor’s know this, and many of them will use this leverage to their full advantage, escalating project cost.
I spent nearly six years travelling the world and developing a system to return this leverage back into the hands of the owner, because I’m tired of seeing my clients taking unexpected costs to the chin with little recourse.
In this article, I’ll share the highlights of this flawed system, and a potential solution owners can use to protect themselves.
A fountain built on Governor’s Island was supposed to cost $1 million, yet it ended up costing $2.5 million.
A famous concert hall was renovated. It was supposed to cost $180 million, yet it ended up costing $220 million.
On another project, the owner requested that the contractor install paneling in numerous dance studios. These were in the original documents, but were excluded from the bid. The contractor charged the owner double what they should have cost.
There are thousands of these horror stories. Why do they happen?
Because once a project starts, all leverage shifts from the owner into the hands of the contractor. And contractors know this.
Often, they will underbid on your project so that you hire them, knowing full well they’ve excluded items you’re going to need later. You as the owner have a business to run and aren’t a construction or design expert.
So you trust the contractor is going to have your best interests in mind. Usually, nothing could be further from the truth.
Every time I walk down the street and pass a construction project, I chuckle. What are the odds it will be completed on time or on budget? Or that the contractor will follow plans and operate with integrity?
Once the project starts, as the owner, you don’t have the ability to hit the “reset” button, fire your contractor and hire someone else. (Only to most likely end up in the same situation)
This hassle isn’t worth it, and most owners have resigned themselves to “if it looks pretty when it’s done, I’m mostly happy”.
Contractors have lowered expectations to such a point that just reaching completion is enough.
And this is why I had to develop a solution to protect owners. It is simply unethical that this continues to happen. Fortunately, progress has been made.
After 30 years of seeing this problem occur again and again, I’ve developed The Risk Free Construction Solution, an “Uber®” for construction projects. Let me explain.
In the old days, before you could open the app on your phone to hire a driver to take you somewhere, you had to call a taxi.
And it used to be a big guessing game. You’d call the cab company, they’d say “20 minutes”, then you’d cross your fingers and hope that they would actually show up in 20 minutes.
Or at all for that matter.
So the cab driver will do his best, take the fastest route he knows, and hopefully show up to your home on time. Of course if he doesn’t, there’s nothing you could do about it.
This is exactly how construction projects are run. It’s a big guessing game and the shortcomings of the contractor often fall on the owner, raising the price of the project.
When you hire Uber® to take you somewhere, you know exactly who you’re going to get, what they’re going to drive, how long they’re going to take to come get you, and how much it’s going to cost.
That’s what the Risk Free Construction Solution does for owners on their construction projects.
Like Uber®, it doesn’t guarantee every experience will be 5 stars, but it does guarantee predictability regarding the outcome.
Regain Your Leverage
For years, I resigned myself to the sad reality that construction is riddled with problems, and nothing can be done.
But as time went on, I observed patterns and discovered why these things happen. It is not by chance that owners get screwed on their projects. It is systemic. The contractors know exactly what they’re doing.
And I couldn’t watch it anymore. So I created a solution for owners to shift the leverage out of the contractor’s hands.
It creates accountability, a sorely needed trait in this industry. No more surge pricing and huge project delays(that the contractors are fully aware will happen).
Discover this solution for yourself and avoid getting screwed by contractors – grab a free copy of “Don’t Get Screwed – How to Solve the Unsolvable in the Construction Industry”. [Link to book]