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0421 348 136

FREQUENTLY ASKED QUESTIONS

How much are your fees?
For Design - Typically less than 1% of project value.

For Design and tender - The Design is FREE

The saving that we are able to deliver through the competitive tender process can be in the order of 10-20% and you do not pay any fees. 
We negotiate a fee with the builder. The fee is equivalent to, or less than their normal sales staff commissions. They also save on marketing and advertising expenses. It is a WIN-WIN all around, you do not pay fees, and the Builder does not pay more than he has to and we earn a fee for saving you money. 
The added huge benefit, you copyright of the plans are yours for your site. 

If we use your Design and Tendering service, how much can we save?
There are a lot of variables that can effect this, the market conditions, type of project, location of the build, the type, size and overhead structure of builder.
For $300,000 - $400,000 project budget – you would save approximately $25,000 - $40,000.
On a $600,000 project budget, that savings would be $50,000 to $60,000.

What is a tender?
A tender is a competitive bid for work.

It’s the process that commercial companies and governments  use to get the best price.

It only works when the same set of plans and specifications are issued to a number of select builders for their price. They all bid on the same design and the competition between the different companies that are invited to bid ensure that the best price and service is acheived.  
The tender system is transparent and gives assurance that all the Builders have competed on same basis. 

Is there an advantage to go directly to a builder?
No!!!  Every Builder would prefer to eliminate competition.

When you work with their plans and design, they retain ownership over the copyright. You are captive to their specification, price and contract. Whilst everything is changeable, but comes with a price, an expensive variation to the contract.

What are the benefits of a tender?

The advantages of the design and tender system are;

  • You get the design that you want with ownership of the plans
  • You will achieve a lower than if you went to a single Builder directly
  • You get access to quality builders that you would not normally be able to find on your own.
  • When everyone bids on the same plans and specification, there are no hidden costs, no surprises or arguments.

Our system provides clarity for you and the Builder.

How much can prices vary?
Prices amongst builders can vary by up to 10%. Builders margins vary depending on their production capacity and how "hungry" they are for the work. The tender process will automatically select those that are most keen for your work. That means savings to you.

How much notice should we take of on-line reviews?
“When there’s smoke there’s fire’ – Some reviews are fair and reasonable, some represent a one sided view that may not be 100% accurate or fair. Bad reviews mean that you have to ask the questions and make up your own mind.

How many builders do you work with?
We work with up to 30-40 Builders at any one time. Not all builder do the same thing. They tend to specialize in project homes, custom projects, extensions, rural homesteads, small commercial, etc.

For each project, we only invite 4 or 5 builders that we know are suited for the project to bid. This delivers effective outcomes and quality work.

How do you find out how much a builder’s margin is?
We respect the commercial privacy of the companies that we work with and only ask them to present us with their most competitive bid. We accept that the margins that they decide to work to is their decision and subject to their specific circumstance.
After we sign a contact with a builder, do you stay involved in the process?
Client feedback is important to us. We try to check up during the course of the project and at the end, and get involved with support if required during the course of the project.

What is the difference between custom and project builders?
Project Buildersoffer homes that are of set designs and specification. They build a large number of homes of a set designs and specification. Their volumes are very high, buying power is high, labour rates lower because the work is simpler and faster. Their cost structure is relatively low but increase dramatically when they are asked to build custom projects.
Custom Builders build individually designed homes. The majority of the dwellings that they build are different in design and specification. They are accustomed to dealing with the individual needs of the client. Their volumes are low, buying power of materials is less, pay higher rates to subcontractors because the work is more involved and slower which reflects in a higher cost structure.
Home Extensions Builders work to an even higher cost structure because their work is far more complicated and requires a great deal more coordination and planning. The subcontractors are the most experienced and have to be very thorough. The material selection is complex because it has to match and compliment the existing structure.

Will the Builder allow us to use our own trades if we want?
To be fair, the ultimate decision is for the Builder because they are responsible for the work and have to guarantee it. They have to be comfortable with how does the work. 
This question depends on the relationship that you develop with the Builder.
What Interior design service do you offer and for how much?
We are able to recommend an interior designer to assist with selections. Most designers charge approximately $500 for a 4-hour consultation to assist with the pre-start process.

How do we know if the builder is financially secure?
It’s a question that can be asked of the Builder that win’s the tender. The other way of finding out indirectly is by talking to referees that the Builder can offer. If the referees report that the build process was smooth, without disruption and with happy subcontractors, it’s a good sign that the builder is financially secure. If the build process is slow with unhappy sub-contractors, that means that cash-flow is tight.

How do we really get to know how long a builder will take to finish our home?
Talking to previous clients is the best way of determining how quick and effective the Builder is. The other way is to negotiate liquidated damages in the contract. The tender process will allow you to do this as a condition of the contract.  

CALL US IF YOU HAVE ANY FURTHER QUESTIONS
              Chris Toth            0421 348 136
                                              chris@extensionsbydesign.com.au

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