Volume 41, Issue 8 - August 2006


To-Do List
A Pre-Quote Check-List
by Stephen A. Melcher

When figuring a quote, there are a number of issues to consider besides the estimated costs for labor, materials and equipment. The following is a handy check-list you can clip, save and refer to when preparing quotes. This checklist may just prompt you to negotiate for more favorable subcontract terms and to adjust your quote to cover risks.

1. Incorporation by Reference. Does the subcontract incorporate other documents or contractual terms by reference? If so, obtain and review these documents to see how they modify the terms of the subcontract.

2. Site Conditions. Does the subcontract require you to examine the site? Have you documented the site conditions? What does the subcontract say about differing site conditions? 

3. Scope. Is the scope clearly defined? Confirm with any other subcontractors and suppliers that they, too, are clear about their scope. If in doubt, notify the contractors to whom you are quoting and, if not cleared up, take exception to it in your quote.

4. Labor. Are there union, Davis-Bacon (editorís note: the Davis-Bacon Act is the law that outlines prevailing wage requirements for public projects) or target business requirements applicable to the project?

5. Schedule. Have you included your schedule with your quote? If not, are you willing to perform at the direction of the general contractor, regardless of your cost? 

6. Paid-If-Paid. Are you being asked to forgo payment if the owner does not pay the general contractor? If so, is the owner solvent? What is the impact of such a clause on your lien and bond rights under your stateís law?

7. Broad Form Indemnity. Does the indemnity clause require you to indemnify others for their negligence? Confirm with your insurance advisor that your insurance covers the scope of the indemnity agreement.

8. Alternative Dispute Resolution. Does the subcontract provide for mediation or arbitration? Alternative disputes resolution can be a more economical method of recovering disputed costs.

9. Acceptance Period. Have you included an acceptance deadline in your quote to limit the general contractorís opportunity to bid-shop?

Note: This discussion is generalized in nature and should not be considered a substitute for professional advice. 

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