I’ve read countless articles over the last 20 years that tell people how to select their contractor. These articles are full of information, but they fail to provide the most practical guidance to those looking for a remodeler. I want to offer insight to help you have a successful contractor selection experience.
In the late 1990s, my parents wanted to remodel their home. They selected what they thought was the best contractor for their project, only to be very disappointed. A year later, their project was not completed and our remodeling company, The Lifestyle Group, was born.
We did not start our business with the misguided notion that everyone would know our business right away. The basic premise we began with was that while you can name five fast food restaurants, banks and grocery stores, nobody can name five remodeling companies. Thus, our goal was to eventually position our company as one that when homeowners considering a project began looking for remodeling companies, we were one of the five that repeatedly appeared in their search.
That original premise hasn’t changed. People still cannot name five remodeling companies off the top of their heads today, which leads me directly to the first tip in selecting a contractor.
THERE ARE NO BARRIERS TO ENTRY
Anyone with a truck and tools can call themselves a remodeler, so you have to understand the contractor decision you make can put your largest investment at significant risk. Keep in mind during your selection process that most remodelers never even took a test to get a license. They just filled out an application and paid a fee to a local jurisdiction to get a license. Oh, and they purchased a bond! That’s it.
While being licensed and bonded is a basic requirement, it doesn’t mean they are the right choice for a project.
How can I ensure my contractor is reputable?
FIND A REMODELING COMPANY WITH A TRACK RECORD
Selecting a partner for a project is best done when your first non-negotiable step is to only work with a company that has been in business long enough to see all the various problems that can arise. A remodeling company that has a history of doing business for years has likely endured various market conditions and persevered, which means they are more likely to be financially stable. Take advantage of the stability and longevity. In an industry where the horror stories of projects gone bad are legendary, many of them begin with the selection of a guy who wasn’t suited to be the best partner in the first place. Think of this step as tilting the odds in your favor — you’re simply reducing your risk of exposure to a bad project by selecting a company that has been there and done that!
THE THREE-BID MYTH
Here’s a remodeling contractor’s point of view on the bid process: There isn’t a professional remodeling company that wants to be a professional estimator. These projects take hours and hours to price. And, if a company is sought after and receives many incoming project requests, they are actively choosing you as a client equally as much as you are choosing them. So, if you share with potential contractors that you are getting several “bids” thinking it will get you better pricing, please understand it will more than likely tell the company you are a price shopper.
We call this the three-bid myth, because it’s a myth that you as a client are best served by getting three bids. You can’t effectively compare the three bids you receive because they all come from a different baseline based on how the contractors run their businesses. What are the allowances for products that the contractors used for your project? Do they all include the same details? Be mindful that there are many contractors who provide the cheapest price possible to get your business on the front end, only to add numerous change orders for missing details. It’s important to do your homework and understand how each contractor approaches your estimate.
BUYER BEWARE: It is a big red flag when a contractor tells you to buy all materials yourself and they will do the installation.
In the end, getting a bunch of bids doesn’t result in the best project or the best client experience. So, how in the world are you supposed to decide who to have do your project?
PICKING THE RIGHT PARTNER
Fit is most important. Period. End of story. You will live with these people for months in your home, so you must figure out who you can talk to and trust. Listen to your gut, it doesn’t often betray you.
There is nothing wrong with having high level conversations with several contractors initially to get a feel for who they are and how they operate. But, as you choose to proceed, I suggest you move forward with the most comfortable fit until they give you a reason not to continue.
UNDERSTANDING DIFFERENT BUSINESS MODELS
A key consideration when making a selection is to have an understanding of how your contractor will perform the work. Some will do the work themselves, while others have employees on staff that are expert carpenters. Then, there’s a third type of company that subcontracts everything out. All approaches have trade-offs. The key is to understand and assess the people that will be working in your home on a day-to-day basis and reviewing the quality of work the company can show they have produced in the past is a good gauge of what you will experience. They say history is the best indicator of future success. Nowhere is this truer than a remodeling company.
EASE OF DOING BUSINESS
There are a variety of details associated with a remodeling project that barely enter your mind initially, but they quickly become very important. Understanding how your remodeling partner handles these details directly affects the complexity or simplicity of your client experience.
Here are suggested questions you want to ask early to understand how contractors do business:
Do they have a showroom for selections?
Do they have a designer to help you make selections or do they expect you to make all these decisions on your own?
Do they talk to you about product differences and the various trade-offs associated with products that impact cost versus value decisions?
Did they ask how long you plan to be in the house so they can help you understand return on investment?
Do they store all the product in your home while work is taking place or at their location offsite until it is needed?
Do they expect you to go buy all your own product or do they have vendor relationships?
Notice we haven’t mentioned project price at any point until now. Obviously, price is important, but in most cases, it isn’t the primary factor when selecting a contractor. It is safe to assume that every contractor knows they are competing for your business.
If the contractor you like is a little more expensive, it is important to think big picture. Consider the financial risk of making the wrong partner choice and the considerable cost of having to redo everything a second time out of your own pocket.
To dive a bit deeper on what drives price, consider the analogy of the price triangle. The legs of the triangle are price, quality and service. The principle says you can have 2 of the 3, but you have to trade one to get the other two.
So, if you want quality and service, you probably aren’t getting price to cooperate. If you focus on best price, you will knowingly have to sacrifice on the level of quality or service you receive.
You have to determine where price fits into your personal list of priorities and effectively communicate that to your potential contractor to gauge their level of interest in moving forward in that type of relationship.
HOW DO YOU FIND THE BEST PARTNERS?
In an industry so fragmented and with so many fly-by-night companies, it is essential to reduce your risk when looking for a remodeling contractor.
Start by asking friends, family and coworkers for the names of companies they have used and trust. Read online reviews to get a sense of what others think. And finally, ask potential contractors for references, and even a couple of names of clients where there was a problem on the project so you can discuss how they handled the problem. This will give you tremendous insight into the character and integrity of the company you are considering for your project.