Sub Prequal Procedures (Helpful in Hard Bid Situations)
PREQUAL/BONDING POLICY
Any sub issued a contract over 300K must be financially prequalified for their contract amount or bonded.
TIME SENSITIVE OPTIONS
Plan Ahead, if possible:
• Reach out to potential local subs who are not currently prequalified and prequalify now
(Note: Estimators can see who is financially prequalified in Building Connected, if a sub is not prequalified they can be sent an invitation to prequalify via Building Connected) • During the due diligence phase of the bid process as new subcontractors are discovered, send them a prequalification package through Building Connected to fill out. Contact their bank and bonding company references and review them ahead of time in the event their Prequal package hasn’t been verified ahead of the bid going in.
In a last minute situation with a sub who has not been prequalified and/or is out of state, make sure to require:
• Ask for Bank and Surety references and contact them. • Bond cost • Breakout materials vs. labor costs (Request a G702/G703) • Identify total labor hours included in their proposal • Run a Dunn and Bradstreet Report to assess the risk profile of the company • Ask what their current workload is • Ask what their annual revenue is • Determine with the operations team if we use that subcontractor’s number can we succeed if the subcontractor walks after award and we need to take the next highest scoped subcontractor • Try and verify if the subcontractor is in good standing with the unions
BEST PRACTICES
If a sub does not prequalify for their contract amount there are additional risk mitigation measures that can be taken. Such as: • Create a Risk Management Plan o Joint Checking o Direct Material Purchases
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