Much of my time as the owner manager of an architectural mouldings contractor is spent with clients and architects helping them realise their dreams.
We are always expected to do this for free. When I first entered the industry in the early eighties we would get fully-designed finishes that required us to do no more than manufacturing schedules. Now we get 鈥渃oncept drawings鈥� or 鈥渕ood images鈥� for us to develop into a constructable end result.
But I am not nostalgic for the eighties, when we regularly got drawings of unbuildable finishes. I don鈥檛 object to getting involved at the earliest stage of the project, often providing the services of my draughtsmen and designers as well as my time for nothing. It results in a better designed and more buildable project that leans towards the strengths of my operation. This gives me an edge on the competition when it comes to open tender.
What I do object to is 鈥渧alue engineering鈥�! There is no professionally prepared and fully costed tender from the client鈥檚 specified specialist that cannot be beaten by a lump sum price from a desperate cowboy in the name of value. It is some years ago that one of my competitors first said 鈥淲hatever Troika have offered we鈥檒l beat it鈥�. He has gone bust twice since then. There is often a cheaper product. But what I do is what you see so when you replace my product with a cheaper one it is not hidden in the structure - you see it.
I used to do a chain of wine lodges with a decorative cornice where the architect specified our design. After a partial roll out which I thought had gone rather well I found out that we had been written out of the future specification. I rang the architect to ask why and was told that it was because we had done such a bad job on the Essex branch. The trouble for us was we hadn鈥檛 done one in Essex! The chosen contractor had used a local supplier of substandard product and so we suffered not only by losing one order but also our future prospects with the client.
Down 鈥渟pecing鈥� and value engineering (VE) get worst in a recession and this current market is no different. Many projects where we have provided our services have now been mothballed or scrapped completely. When we do get to tender stage we are then at the mercy of the contractor who is desperate for the work and will try every form of down specing and VE to get it.
Whilst I have no evidence (yet) of the return of negative tendering during this recession, (but as a cynic I think it will not be long before I have), the new favourite practice is late ordering. This is done in the belief that the later the order is placed, the lower the price will be. The result is that lead times in my business have come down from frantic to panic.
Another trick is supply chain abuse where the contractor lets the subcontractor put forward a supplier only for the contractor to try and order direct. A twist on this is where the contractor tells the subcontractor to include an element in their package at a rate the contractor knows is unobtainable, giving the subcontractor the problem of finding a cheaper alternative or taking a loss on the job.
But the real fault lies with the clients and architects. The clients mostly want the contractors to get the cheapest price and the architects appear to no longer have the power to insist on what they specified. If the industry is still going to have a strong supply chain when we come out of recession, clients and architects have to play their role in protecting the specialists they need to achieve their dreams. If they don鈥檛 then they will be stuck with the cheapest reality that money can be wasted on.
Terry Wright is the managing director of architectural mouldings specialist Troika
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