PC5 Building procurement Flashcards
What is a Contract Administrator and what do they do?
A Contract Administrator is a role often carried out by architects. They act in a quasi-judicial role to fairly administer the terms of the building contract, acting impartially. Their main responsibilities are as follows:
- Administers change control
- Issues certificates
- Chairs progress meetings
- Agrees schedules of defects
- Pursues contractual agreements and payments
What is an Employer’s Agent?
They manage the delivery of a D&B contract and can be appointed before the contract is signed. They act as an agent for the client. Responsibilities include:
- Securing applications
- Consents
- Instructions
- Notices
- Requests
- Statements
The EA can provide unbiased advice for the client during design and construction of the project.
What is construction management procurement and when is it suitable?
Works are constructed by a number of trade contractors who are all employed by the client but managed by the construction manager.
Suitable for:
- uncertain projects
- Major building projects
- Expert clients
What is management contracting procurement and when is it suitable?
Works are constructed by a number of works contractors who are employed and managed by a management contractor.
Suitable for:
- Large, undetermined projects
- Complication projects
- Major projects
- Projects where time must be prioritised over cost
- Expert clients
What is Design and Build and what are the advantages and disadvantages?
Main contractor employed to design and construct the works. Design team may be novated to the contractor or the contractor may choose to use their own team. Can be carried out as single stage or two stage.
What is traditional procurement?
- The most common procurement route.
- A client appoints consultants to design the project in detail
- and then prepare tender documentation, including drawings, work schedules, and bills of quantities.
- Contractors are then invited to submit tenders for construction of the project, usually on a single stage competitive basis.
- Contractor is generally not responsible for design, so design and construction are carried out separately
What are the advantages and disadvantages of D&B procurement?
Advantages:
- single point of contact for the client
- Can overlap design and construction phases, speeding up process.
- Most risk placed on the contractor
- Usually provides good cost certainty because of firm contractual arrangements
- input from contractor on design can save costs and speed up process because they can input with their expertise on cost and buildability.
Disadvantages:
- Inflexible as the client has fewer tools to vary the works
- Design may put more focus on cost and buildability at the expense of quality
- Harder to select a builder as tenders are based on both design and construction
- Tendering is expensive as every contractor has to design, quantify and price the project
What are the advantages and disadvantages of Traditional procurement?
Advantages:
- Independent consultant design advice
- A fully specified and detailed design
- Easier to select a builder as tenderers are not pricing for design
- More emphasis typically placed on quality
- Good for clients who require control over detail design and specification/ changes during construction may be necessary.
Disadvantages:
- Design needs to be developed in more detail prior to tender, which generally prolongs the process
- Liabilities split between designer and builder, leading to less effective redress should things go wrong
- Multiple parties for client to deal with
- Often much less certain in terms of time and cost, where design is varied. Then again, tenders can be set at fixed price to improve cost certainty.
Types of contract?
- Prime cost contract: (can be called cost plus or cost reimbursement contracts) when an early start on site is required. Tendering based on outline specification, drawings and cost estimates. The contractor is paid a prime cost (actual cost of labour, plant and materials) and a fee for overheads and profit. Fee can be revised if necessary and can be a lump sum or percentage of the prime cost.
- Lump sum contract: a fixed price contract where contractor agrees to execute the work for an agreed total sum of money. Suitable when changes unlikely and project is well defined, allowing contractor to price accurately.
- Cost reimbursable contract: where the contractor is reimbursed the cost of carrying out the works, plus an additional fee. Suitable when the project nature or scope is unclear at the outset.
- Measurement contract: The actual contract sum is calculated on completion (when it cannot be calculated when the contract is entered into) based on ‘remeasurement’ of the works carried out.
What is novation?
A process by which contractual rights and obligations are transferred from one party to another. Beneficial to a client because they can maintain continuity between pre and post tender design. Note: novation does not make the contractor responsible for pre-tender design, unless stated in the contract that they are to review and adopt the design.
What is tendering and what is the general process?
Tender is a submission made by a prospective supplier in response to a tender invitation where they will make an offer for the supply of goods and services. Can be undertaken as single stage or two stage.
Typical process:
- Pre-qualification questionnaire
- Invitation to tender
- Tender response
Explain single stage vs two stage tender and the benefits of each?
Single stage: The more traditional route. Used when all information necessary to calculate a realistic price is available at the time of tender. So based on detailed information.
Two stage: Used to allow early appointment of supplier prior to completion of all necessary information needed to calculate a realistic price.
First stage: Rough price calculated on less detailed info > limited appointment agreed
Second stage: More detailed info produced and priced > fixed price is negotiated for the contract
What would be a typical tendering process for traditional?
Single stage ie. detailed information produced and tender assessment and award carried out based on this info at Stage 4.
What would be a typical tendering process for single stage D&B.
Tender assessment and award based on contractor’s proposals and Stage 3.
What would be a typical tendering process for two stage D&B?
Tender to select preferred contractor at earlier stage eg 2, design development through stage 3 and then tender exercise carried out based on detailed info at Stage 4 to negotiate fixed price for the contract.
