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Tuesday, July 22, 2014

How to hold a subcontractor by the contractor to its bid

Many times, the contractor has to face problem for relying on the subcontractor’s low bid as after being awarded the prime contract to the contractor, the subcontractor refuses to work at the price originally bid.

In this situation the contractor has no alternative than hiring a subcontractor from a different company at higher charges.

So it is important for a contractor to assess properly whether he/she can hold a subcontractor to its bid.

The contractor should consider the following points to perform the same.
·         Suppose the subcontractor provides only an estimate of the cost of the work without proposing to create a specific offer for executing the work at that price. 
·         Suppose the subcontractor’s bid or proposal is made unpredictable specifically or needs modification. Is there an apparent and clear-cut offer under such situations? 
·         Should the subcontractor contain genuine knowledge and anticipation that the contractor will apply his bid or proposal while suggesting a bid or proposal for the total project? 
·         Is there any rules or regulation in the construction industry that ensure the reliability of a subcontractor upon which a contractor can trust in the subcontractor’s bid or proposal in the making of the contractor’s overall bid or proposal on the project? 
·         Does the subcontractor’s bid or proposal varies to a large extent from the other bids or proposals that the contractor obtained? 
·         Is there an evident mathematical miscalculation in the subcontractor’s bid or proposal that the contractor can notice apparently? 
·         Is the subcontractor’s bid or proposal much lower as compared to other quotes obtained on the same project?  If so, does the contractor undertake any method to authenticate or certify the subcontractor’s bid or proposal? 

·         Does the contractor give the wrong impression about an inexperienced subcontractor ensuring that the subcontract work can be accomplished at a price offered by the contractor when that price undervalued the accurate cost of performance?

Published By
Rajib Dey

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