113 Architecture questions - What is the general contractor award?
What is the general contractor award?
There are different ways of commissioning the realisation of a construction project. In the case of individual commissioning, the respective specialised companies are invited to submit a bid and the client can select the best bidder. This is relatively time-consuming, but can ideally keep the construction costs somewhat lower.
Alternatively, there is the option of using a general contractor. This is commissioned by means of a contract for work and labour for the construction of a building and, as the contractor, is solely responsible for the execution, bears all risks and warranty claims and subcontracts individual trades to subcontractors. As a rule, the outsourced services are building services, electrics, painters, floor layers, etc., to name just a few examples. For this additional work and coordination, he is entitled to a corresponding surcharge.
The main contractor calculates the general contractor surcharge for coordinating and ensuring a smooth and timely construction process and passes this on to the client. The surcharge is usually in the range of 10-15%.
In addition to coordination, the general contractor also bears the responsibility and all risks (price changes in the case of lump sum offers, defects, subcontractor cancellations, etc.) which are compensated for in this surcharge. The advantage for the client is that he has only one point of contact from contract negotiation to the final invoice and rectification of defects. The coordination work and thus interface and deadline risks etc. are outsourced and the client's own expenditure is minimised.
