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Partnering with contractor

Saint in the City

The firm I work for has a good relationship with a local contractor that we've together done some small and large projects.  Now the contractor wants to meet with the boss and me to discuss some type of short-term alliance where we go after projects in more of a design-build approach.  Very vague and blue sky right now.

Any thoughts on this?  Similar experience? Pros?   Cons?

Thanks in advance.

 
Nov 29, 14 10:44 am
wurdan freo

Sounds like you are already partnering with him. Unless you are talking about a merger, this is done everyday. The typical difference in "design-build" with two separate firms is usually the design team is hired by the contractor. The contractor becomes your client. There are standard contracts for this, and as long as the scope is clear, shouldn't be an issue. In true design build (one firm) you can find efficiencies in time spent developing a cd set, but when it is two companies, you won't find as much as the legal ramifications between two entities are still there. 

I've partnered with design firms from the construction side with some success in this approach. The other "partnership" marketing approach we've used is some form of IPD. Biggest concern, as with any relationship, will this partnership improve your reputation or hurt it. Do the company cultures align?  

Nov 30, 14 1:34 pm  · 
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Carrera

Saint - Well I do have some experience with this, 40 years’ worth. Most experiences I had like this were one-way streets…they want what you have but don’t give you what they have. Another problem with a “formal” alliance is all the other contractors in town will stop feeding you work. Also other architects will get jealous and stop feeding the contractor work. It’s okay to have an alliance but not a public alliance. Know architects that got connected with some big contractors and soared but they kept it more on a project by project basis with no known alliance….although there probably is one. I said to hell with them all and started my own design-build company then everybody was jealous of me:)

Nov 30, 14 1:48 pm  · 
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Saint in the City

Wurdan -- thanks for the comments.  In the offices I've worked in, contractors routinely hired us -- which I agree is very common.  Some of it was really dirty work, but sometimes it landed us some nice office park projects, etc.    Other than some steady work, I can't say that it provided us or the client with any unique benefit.  

Until I meet with these guys, the only real difference I know of so far is that it sounds like this contractor wants us to attend some marketing presentations to potential clients -- I suppose the idea is to present ourselves as a one-stop shop.  Which, we'd sort of be, if you squint from a distance.

"Most experiences I had like this were one-way streets…"  thanks, Carrera -- often seems to be the case.  

"Know architects that got connected with some big contractors and soared but they kept it more on a project by project basis with no known alliance….although there probably is one."  I'd guess this is what's hoped for in this case as well...    and you're right, the PR with other contractors is a big issue.

All things considered, it seems like a tricky proposition, and I'm not sure what the real benefit could be beyond any other commissioned work...? 

Dec 1, 14 10:36 am  · 
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Carrera

Saint - well the benefit to any meeting is to see where it will lead and the trick is to figure out how to say no without alienating anybody – devise a sideways move to get the best of both worlds – good luck.

Dec 1, 14 11:00 am  · 
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Saint in the City

^  True.

We are definitely going with open minds -- maybe I sounded like I had "pre-condemned" the idea!  The contractors are very decent guys, and we really enjoy working with them a lot.

   

Dec 1, 14 11:33 am  · 
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proto

my jaded opinion is that the designer will come out with the short end of the stick since the GC now holds the contractual reins:

1) likely limited pay for the usual high expectations of quality (your firm's reputation on the line)

2) no direct voice with the client (not when things are going well, but when the project gets challenging)

 

ask yourself what will happen when there is a financial or schedule issue? how will you preserve the quality you expect? will you have the independence to assert  your proposed solutions?

 

i do think design/build can work when the contractor IS the designer, but i'm cynical when they are two separate entities because of the competing interests of the otherwise (but-for-this-deal) independent offices

Dec 2, 14 12:22 pm  · 
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Saint in the City

proto -- all good points to consider....  thanks for your input.

Dec 2, 14 4:29 pm  · 
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One way to approach the situation is as preferred partners. The idea is that the first recommendation from each of you to a potential client is the other party, and that clients are offered a carrot in the form of discounted fees if the other party is retained. The ability to discount the fee comes form the known quantity of the existing relationship and having an extra front man, so to speak.

This avoids the pitfalls of "official" partnering described above and leaves a project on the table if for one reason or another one of you doesn't fit with the client. Consideration of how to handle the discounted fee in such a situation is important.

Obviously the contracts remain separate and the traditional responsibilities apply.  The unwritten agreement is that you won't do the usual thing if a project goes south and automatically throw the contractor under the bus (and vice-versa).

Dec 2, 14 5:36 pm  · 
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My experience in high-end custom residential is exactly what Miles outlined above, and for the most part it worked  very well for everyone, including the client. It's a much more personal relationship all-around, for a very intimate project on the client's part.

Saint, it sounds like you're talking about bigger/commercial projects. In my experience, commercial clients are more paranoid about cost than residential, so they can tend to see even an unofficial prior relationship between designer and builder being to the detriment of their profit - they have a harder time trusting that working with someone you've worked with previously is about trust and comfort level, not kickbacks.

Dec 3, 14 8:45 am  · 
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Saint in the City

Miles -- thanks for the input.  

"The idea is that the first recommendation from each of you to a potential client is the other party..."

When I think about our relationship with this contractor, I think what you're describing is exactly where we've been slowly and sort of  unwittingly heading with the contractor.  Might be good meeting fodder to throw this out there if this is what's inteneded, and then discuss ramifications.      

The contractor also seems to be talking about heading to interviews together as a team -- I guess take us or leave us both.  Which, of course has some pros and cons...

The contractor has definitely thrown more work our way than we to him, so we are going to at least go to the meeting tomorrow with open minds. 

Dec 3, 14 10:01 am  · 
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Saint in the City

Thanks, Donna -- great points to ponder.   Toward your second paragraph, I think Miles' nominal discount may help.  I also am wondering if the way that fee structure and cost are handled could potentially alleviate some of the perceived detriment...

Dec 3, 14 10:45 am  · 
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raka712

Hello All,

Happy 2019!

Thank you all for the comments! I am in the midst of writing a sales template email as a GC towards Architects. if anyone has any tips/templates that have worked for them, I would love to be able to view them and see if theres any alignment on what I would be able to implement into my own template.

Thank You


Rahim

Jan 15, 19 2:32 pm  · 
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