Section 8 – Award of Contract
Once the bids are received and opened (this is normally a public opening but can be private), the Architect and Owner and the General Contractor at Risk (if previously selected) normally review the various bids and select the various bidders (this may or may not be the low bidder, but it is generally the lowest bidder).
Once General Contractor (if not a General Contractor at Risk) is selected and the subtrades have been selected, the General Contractor will go back to the subtrades and request ways for reducing the amount of the contract. This is usually where things start to go wrong.
This process is what is normally called the Value Engineering Phase (however, this is not what I call it).
The term Value Engineering should not be confused as having anything to do with value of the equipment or services being provided; it would be better looked at as “de-value engineering” where cash- strapped General Contractors are looking to cut costs.
During this phase, the General Contractor will ask the subtrades and Kitchen Equipment Contractor to provide alternate pieces of equipment or manufacturers to reduce the amount of the kitchen equipment contract.
The Foodservice Consultant (Kitchen Designer) is almost never asked to be a part of this meeting/negotiation.
You have hired a Foodservice Consultant to prepare your drawings and specifications to meet your needs – do not allow a General Contractor and Kitchen Equipment Contractor to redo the design and requirements so the General Contractor can save some money on the project and give you less of a facility than you asked for.
To reduce the cost, the Kitchen Equipment Contractor will offer alternate manufacturers and models, and possibly even older models that he has in stock and needs to get rid of, that are out of warranty and may not be as efficient as the newer models.
This price may be attractive to the General Contractor and he may propose that you, the Owner, accept this cost saving. As the Owner, you may elect to do so, based strictly on cost, but it may not actually be to the best advantage in the long run. We recommend that you a Chef or Operator assist you in the review of these changes and possibly your maintenance department and the Foodservice Consultant (Kitchen Designer) prior to accepting the offered reduction.
Once the Value Engineering items are selected and approved by you, not only the foodservice equipment (kitchen equipment) but the rest of the facility, the drawings and specifications will need to be revised to reflect these changes. There will be an additional cost for you, to have the entire Architectural Team revise and update their drawings and specifications.
Project at Risk
This leaves the project at risk to make sure all of the changes are coordinated and the revisions are made prior to construction beginning. These changes will normally generate other changes as the project develops.
When the Contract are finalized and awarded the project moves into the Construction Phase.