(NFR) how do I check that a company is legite?

Discussion in 'Fly Fishing Forum' started by pwoens, Apr 6, 2005.

  1. pwoens

    pwoens Active Member

    I have been looking at building a shop and have a fixed price to spend. Everyone that I have received bids from have been right at this fixed price, NOT INSTALLED. Well, one company offer me a better building for the same price, INSTALLED and with extras. I had a hard time refraining myself from signing the contract on the spot but I did not sign and wanted to research his company. My question is, where can I find out what kind of business he does? i checked Better Business Bureau already but not sure what else to do?

    Any input is greatly appreciated.

    Thanks
     
  2. jeffw

    jeffw Member

  3. East Fork

    East Fork Active Member

    Ask for references. Withhold enough of the contract price to insure satisfactory completion. Check claims against their bond. Bottom line; if it sounds to good to be true it probably is. How could this one company have a cost structure so different they can provide labor but no one else can?
     
  4. Kent Lufkin

    Kent Lufkin Remember when you could remember everything?

    Exactly. If their references check out, offer to pay one third at the start of the project, another third midway (assuming that everything's going OK), and the last third upon completion. NEVER pay the total amount up front, no matter what they say. If you prepay the entire amount, you have absolutely NO leverage with the contractor and the job will most likely never be completed to your satisfaction.

    It's a very rare construction project that doesn't go over budget. If you've already told them what your maximum amount is, how will you pay for any overages or add-ons when (not if) they occur?

    If you haven't told them what your maximum price is yet, suggest an amount about 85% to 90% of what you really intend to spend and hold back the rest for contingencies. If you're lucky enough to bring the project in at that amount or below, consider the unspent extra money a bonus.

    K
     
  5. MDL

    MDL We work to become, not to acquire.

    You can also call the Attorney Generals office to see if they have any complaints. The BBB really isn't that great since companies pay to be members. And don't pay it all up front.
    Mike
     
  6. jabseattle

    jabseattle jabs

  7. FlyShopKristin

    FlyShopKristin Going Online

    Definitely agree with the comments above. We put up a garage a couple years ago and had a less than stellar experience. Ensure that the payment structure gives you leverage to have the building completed per the contract/blueprints.

    References: ask for references from the company AND - ask that they are references from the specific crew that will work on your building. There can be a wide variety of skill level between crews working for the same company. A larger company may sub-contract out your job.

    This may be an intangible, but I say this based on experience: Check out the crew and go with your gut. I think that a crew should show up on time, and work truck & tools should be neat, tidy and organized. If their work trucks & tools are organized and cared for - you should receive the same level of work on your garage. If they don't even take care their tools, you should not expect that they will care about your building.

    I don't mean to sound doom and gloom, I know that most construction companies are honest & will put up a great building. I'd say take a couple steps to safeguard yourself and you'll be good to go.
     
  8. sjterry

    sjterry Sr. Lurker

    Every contractor in the State of Washington must have a valid license. To have a license they must have insurance and be in good standing with the Sec. of State. You can check out insurance and license status at this web site:

    http://www.lni.wa.gov/TradesLicensing/Contractors/HireCon/default.asp

    You can also check how long the contractor has been licensed and check recent lawsuits against the contractor on this site. Be careful of anyone who has a history of collections or bad debt. Also, ask for a current certificate of insurance and check the references. You can also ask for a list of suppliers and check the contractor’s payment history with them. You don't want to get stuck paying the contractor to have the contractor skip out and then have to pay a supplier on top of it. Expect 5% to 10% cost overruns. Be on site for the job if you can.
     
  9. pwoens

    pwoens Active Member

    BBB checks out, L&I checks out, and a few of the suppliers that I have reached, check out so far. The one thing I am hearing is that he may be a little too busy and thus the project could take longer than other companies. The time frame is not a big deal cause I was going to do it myself and planned on two months, so if he takes a month or two, no big deal :confused: . I just requested references and a copy of the contract. Thanks for all the input everyone :thumb:

    I have never had to worry about this as I do everything myself, but heck this guys price is outrageous so its hard to pass up......
     
  10. barbless

    barbless Member

    There are three legs that hold up the "stool" of any construction project - SCOPE, SCHEDULE and BUDGET. Another way of saying this is "faster, cheaper, better - pick two..." :ray1:
    It sounds like you are picking better and cheaper, which is great. However, I would caution you to unambiguously state the completion date of you project in the contract and, if you can, put in some liquidated damages language if the project isn't done on time (he pays you $$$ per day or week if its not done by the date specified in the contract). This will let him know you are serious about finishing the project even if you are not in a rush. If he cannot commit to a completion date, I would not use him. You usually get what you pay for. My $.02. Good luck.

    barbless
     
  11. Dan Reynolds

    Dan Reynolds Member

    Coming from a construction background...I'd advise asking the company for some references from suppliers they deal with. (If it's a large company they might blow you off on this question). If you think the company deals with local lumber yards etc...you could call those companies and ask them how reputable they are. (You would need to talk to the people in the finance/bookkeeping dept ...)

    There are a lot of construction companies that have trouble paying thier bills to suppliers (that could result in delays in construction, excuses etc..)

    How big of a shop are you talking? garden shed or large building??

    Most important thing*** Make sure you retain a portion of the pay...as you disperse each installment (including the last pmt) as to retain control of the job. Many people pay ahead and unfinished work drags on and on cause the builder is on another paying job and gives you the run-around.
     
  12. Bob Triggs

    Bob Triggs Your Preferred Olympic Peninsula Fly Fishing Guide

    Patrick, Talk with their customers, go see their projects. No buiilder is problem free- that is not the nature of the work. The real question is if they will do what they say they will. There should be some history there to look at. Yes; lisenced and bonded etc. But none of that is a real qualification for the craft, only the paperwork. In the end, no matter how thick the contract, it all comes down to trust. If their other customers trust them, maybe you can too. Trust yourself too, listen to your gut. Be practical. Dont pay it foo till it's done. get a warranty in writing. Keep all the communications clear and it should go well. Changes take more time and cost more. Dont expect to participate in the process without paying more, if it takes them more time or materials for you to be involved.

    "Pretty is as pretty does." Yes, a good tradesman has his tool in order. But I have seen guys get into building, especially as sub contyractors, and their tools are all lined up and neat and pretty, and their skills were very poor. So dont weight the neat and tidy tool thing to heavily. Look at the man first, and his work.

    All of the other responses were very solid as well.
     
  13. RThorn

    RThorn New Member

    What's the company? Maybe someone here has experience with them.
     
  14. pwoens

    pwoens Active Member

    Shop is a 30x30 with 10 foot eaves (wrapped) pole style, a 16x8 insulated door, a 3ft man door, 2" mdi insulation in the roof and the walls, commercial gurts, and a 4" concrete floor with 3 inches of 5/8 crushed underneath with fiber mesh for re-inforcement. He is pulling permits, grading the site, bringing in two loads of dirt, and completely assembling the building and floating the floor for 10k even out the door, tax, delivery, materials, labor, ect. All other bids for this building without overhangs, without 2" mdi in the walls, and without commercial gurts, were at 15-16k.

    as for pay he is asking 1/3 down, 1/3 at delivery of materials, and the remaining 1/3 at completion.

    In the contract I am going to ask for atleast following:

    • price is not to exceed the 10k agreed upon, under any circumstances
    • ALL of the signed lien releases from the mfg's stating the bill has been paid
    • project to complete within 30 days of start date and for every week past the completion date stated, a $250 penalty will be charged

    and anything else you may think of???

    I have spoke to several suppliers now and what I am hearing is basically he is busy and I may need to worry about a timely finish?? no big deal if its done within two months???
     
  15. pwoens

    pwoens Active Member


    I just got off the phone with a couple of references and so far so good. Thanks again everyone
     
  16. sjterry

    sjterry Sr. Lurker

    Don't Say Penalty Say Liquidated Damages.
     
  17. wet line

    wet line New Member

    I think it is very curious why such a huge difference in bid prices. A job of your size should have about a 15% swing in high and low or about a $1500 to $2000 maximum difference.

    I would ask the two high bidders what they see that is driving their costs so much higher than the low bid. Perhaps the low bidder missed something. Then I would ask the low bidder how he can come in so much less and if there are concerns or issues raised by the other bidders I would be asking if these things are addressed.

    Also I would check out the high bidders and see if they are always way high in their pricing. Somewhere there is a reason for a $5000 swing. You should find out why.

    Dave
     
  18. wet line

    wet line New Member

    Something else I forgot to mention. Be sure to understand the change order policies of each company. Often the low bidder uses this ploy to drive up the cost. What starts out as the low bid can often times end up being the highest price because of change order policies.

    Dave
     
  19. pwoens

    pwoens Active Member

    Shady deal

    Well, after my research yesterday i contacted several references and got excellent reccommendations. THEN, i received a return phone call from another contractor and told him about the really cheap bid. He asked who the company was and I told him. He then got frantic and told me whatever I do, do not give him any money cause he's a fraud, theif, convicted felon, and a liar. This guy gave me 4 people to call that have recently been ripped off by this guy. So i called these people and sure enough the cheap contractor had taken their 1/3 down $$$ and has yet to be seen......and this was from a few months back. Turns out there is almost 100k worth of liens against him and he is changing to a corporation....which may be an indication of bankruptcy and protection from loosing his personal assets. PLUS, he told one of the bad references that threatened to sue him that they would be on the list when he files for chapter something or rather???

    Glad i didnt sign the contract on that first night and give him 3300 bucks.

    Turns out that my father-in-law's partner own a steel structures company and said he will give me wholesale on all the materials and save me 30% off of all the bids I have receiving for a "kit". So in the long run things will work out for a bigger and better shop :thumb: :D

    Thanks for all the assistance :thumb:
     
  20. nomlasder

    nomlasder Active Member

    I'm curious, what do you plan to use the shop for.