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Construction Procurement is making decision on a variety on the project current needs to make sure that the project can be completely finished on time, within budget and matching client expects quality. Procurement rout can help the concerned organization to understand their roles and relationship to achieve the construction project get possible high profit and possible best quality. It can help client to select a suitable construction organization (main contractor, sub-contractor etc). The procurement also can help the construction organization to provide at the best possible cost to meet the client required quality, quantity and time.
Client's Profile & Project requirement
Now you consider to reconstruction their 3 existing hotel in the South East of UK. Even though you have a lot of experience for building renovation, you do not have enough experience and unable to devote sufficient time to provide effective advice during building design stage.
Base on your re-open planning (plan date is 1st April 2015), this project should have a certainty of project programme and good construction planning to achieve your business planning. You can get £12 million (estimated) from bank. You want get better design solution and can using good quality material within project budget.
When select procurement route, you should be considered your company condition that can help you control and reduce project risk (like time, cost and building quality).
You want built a better quality than their existing hotel quality. And this new hotel should be remaining the design style. But the new hotel should be increase some new design different old building to cater to hotel guest requirement. It also meets your business strategy (wants get long term profit from this project, belongs to primary strategy). The new design should be include:
High Class Restaurant
Swimming pool and Children Play Garden.
Studios. The dance studios can provide wedding and company party service. This service can get additional profit.
Dance & Health and fitness centre (like Gym room and spa room)
Conference and meeting room
Sky garden on the roof
Due to local weather condition and your Business planning, the project only have 12 months including design stage and construction stage (Plan start date on 1st March 2014, Handover date on 28th February 2015). And all sites will require the demolition of unsound structures and rebuilding.
Propose Procurement Route
Base on Client condition and requirement, we will analysis and compare 4 different types of suitable procurement route for this project. And we will recommend one best suitable procurement rout.
1. Traditional Procurement Route
Traditional procurement route is suitable all condition of Client and all different function of building. Using this route, you need provide your brief and budget for this project. You can appoint us for helping your control project design and costing. We can base on your requirement, condition and business strange provide suitable hotel design and project amount (estimated). After you confirm the design, we can call tender for the construction stage. We will help you prepare the contract document for clarify the detail responsibility between you and appointed main contractor. The contract document will include full set of design drawing, design specification and tender decrement.
You will have a fixed project cost and finish date. If have any variation order or extension of time, you and contractor can base the contract document to clear the responsibility.
This procurement routes has low cost risk and time risk (construction time). Using this procurement route, this project can be finished within planned project duration (within 12 months) and budget (below £12 million). Easy define the variation order and responsibility for project delay, is major advantage of this route.
If have any design error, its responsibility will be belongs to you. But you still have more than one year (present to 1st April 2014) for the hotel design. We will provide professional opinion on the design stage to help you minimize the design fault.
2. Design & Build Procurement Route
Lack of construction experience client, inexperience client or do not want close involvement client can consider this procurement route. This rout is mostly using simple building (like hotel, hospital, school and so on).
This route not requires you involve project design stage. The main contractor has fully responsibility for building design and construction. You only provide the project outlet design and requirement for tender in pre-contract stage. The contractor can provide professional advice for detail technical design. After awarded this project to main contractor, they can construction at same time with design stage. This route can reduce total project duration (compare to traditional route). This is suitable for the fast track project.
But this route has high design and quality risk. The final design and building quality may not be able to achieve your respect. Even though this procurement contract also is lump sum contract, you still cannot get the certainly cost and handover date before the contractor finishes and construct their proposed design. And using this route is difficult to define the variation order for non-experience client.
3. Management contracting Procurement Route -
Management contracting Procurement Route is suitable for having construction experience client and fast tracking & complex project.
The design stage will charge by consultant and main contractor before the design has completed. But during this stage, you need give effective advice for the buildability and approve design proposal. After design approved, contractor can start the construction stage immediately. The contract should be signed by management contractor and work subcontractor, and has a basis project fee. But final cost need confirm after confirmed the last package.
Normally the project will be completed on time. The building quality and design can match client requirement and expectation. The Management contractor has fully responsibility for project delay and any defect. If this project has any delay and defect, the client still can only deal with the management contractor to solve problem.
But the project will be separated by different individual sub-contractor and suppliers. It is difficult to make a good communication environment for the sub-contractor and supplier. So the quality is difficult to control. And need provide a good project planning schedule by the management contractor.
4. Construction Management Procurement Route
This route is mostly same with Management Contracting Procurement Route. But still have some condition is different. For contract sum, you should advise the appointed construction manager. Differently with Management contracting Procurement Route, the Contract sum has a fee basis, but cannot be negated.
You need deal with different sub-contractor, not only deal with contract management. Because they only need concentrate to the design stage and will be expected to co-ordinate the design and construction programmers, to ensure the trade package can be considered. This rout requires you involve in whole project programmers (including design and construction stage). And you must give the construction management and sub-contractor directly decision for the project.
Normally the project also will be finished on time, and building quality and design can match client requirement and expectation. Due to contract sign by different sub-contractor and supplier, the responsibility for project quality and timing is belongs to individual sub-contractor and supplier. And if have any delay and defect, you should direct deal with different company.
Based on our professional experience and consider project duration of time, cost, quality, building function and client's condition, we propose you choose the Traditional Procurement route for this reconstruction project. You very pay attention for the project timing and budget. If choose the Traditional Procurement route, you can get certainly cost and project finished date at beginning.
And for the hotel design, this route will help your get a hotel to match your requirement and your company business strategy.
We hope this proposal can match your requirement.