Re:Efficiency eludes the construction industry (2017)
by Ozzie_osman on Saturday July 10, 2021 @04:59PM
(#27796430)
> It’s common in the construction industry to compete during the bidding phase by underestimating the time and cost of the project, then making up for it with change orders later.
This is called change order abuse. Sometimes the contractor actually has an inside person receiving kick-backs or bribes where they can purposefully underbid while knowing in advance that they will be able to make it up with change orders (which will be approved by the inside person)
I’m guessing this explains most of it.
It’s common in the construction industry to compete during the bidding phase by underestimating the time and cost of the project, then making up for it with change orders later. It’s so pervasive in some domains that contractors feel they have no choice but to play the game to get contracts.
The smart buyers employ people who know how to manage contractors and construction companies with contracts that make time and budget overages less profitable for the company. The catch is that you need someone on your side watching the work so they don’t try to cut corners to get the job done. It’s difficult.
At smaller scales, it’s common for contractors to bid more projects than they can handle and then rotate between them, tending to the clients who complain the most. They’d rather overbook their calendar than have gaps in between projects.
Construction and contracting are not fun industries to deal with. Having known reputable contractors is very valuable, but the good ones are often booked out a year in advance.
And I agree about the other oddities in this article. I don’t even know if hand drawn building plans would be allowed in modern towns. Usually a licensed engineer is required to draw and approve the plans and there aren’t many licensed engineers still doing this who don’t use CAD.