Learning to Negotiate a Bid

The general advice people receive when they are considering a home remodeling project is to solicit bids from at least three home design contractors. This is called competitive bidding. This is a way to "comparison shop" just as you would when buying a television or appliance, the only factor you're using in making your purchase decision is price. It's a good way to shop for a product, but might not work well when buying a service, which is what general contractors provide.

Let's introduce you to an alternative to competitive bidding which you may not be aware of, a negotiated bid. This is not a situation where you haggle the price with the contractor. Rather, you and the contractor become allies in making your project a reality.

The procedure for negotiating a bid goes usually goes something like this: First, you pick a contractor you like and trust before the design process has begun or is in its early stages (there are many ways to find a good contractor; referrals from friends, NARI.org or NKBA.com). You and the contractor work together as a team to develop a project which fits your needs as well as your budget. This is a simple explanation of the negotiated bid process. You'll probably require a bit more information before being sold on the concept but before we move on let me draw your attention to a few key words which need to be understood in context: trust and team.