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John Kaltenbach Homes

John Kaltenbach Homes

Custom Builder of New Homes in Albuquerque and Santa Fe, New Mexico

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What’s Wrong With Competitive Bidding in Custom Home Building?

Competitive bids are just that! If I shave labor or materials to get your job, is that the house you really want? There are hundreds of ways to lower the price of building, which often lower the quality and workmanship also. The best drawings and specifications don’t protect you from poor trade practices.
The Well Built House, Page 23

The quote from The Well Built House sums it up well. There are plenty of ways to cut corners to create a lower price. Competitive bidding just rewards the lowest price, it offers absolutely no advantage to good workmanship and actually encourages cost overruns and completion delays.

In one survey of satisfied owners of completed projects, the most important personal attributes of a good contractor were:

  1. Honesty and Integrity
  2. On time performance
  3. Good organization
  4. Good scheduling
  5. Good subcontractors
  6. Good communications skills
  7. The ability to empathize
  8. Long term relationship oriented

Cheap price isn’t even listed! In the same survey of satisfied homeowners, here are the attributes listed as being present in good construction companies in order of importance:

  1. Quality construction
  2. Clear builder specifications
  3. Good company organization
  4. Ability to provide price checks
  5. Ability to provide value engineering
  6. Company responsiveness
  7. On time performance
  8. Fair price

Price was only the eighth most important attribute customers considered important in a contracting firm, and even then, the word used was “fair” price, not “lowest” price.

Do you really want a contractor always trying to figure out the cheapest way of doing everything for place where you family will be sleeping the week you are out of town? We prefer to do things the best way. “Best” means, in our opinion, the most effective combination of price to performance, getting the most bang for your buck.

A competitive bid does not let you see how a contractor works. Referrals do. A competitive bid does not demonstrate how John Kaltenbach Homes, as an experienced contracting company, can guide you through the process from beginning to end. We don’t feel that an estimate, driven by price, will give you what you really need.

We have one request:

Select your contractor based on reputation, not price!

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