Traditional vs. Design and Build Contracting
Two of the most common forms of tendering fitting out works in the London Market are Traditional and Design & Build.
Under the traditional procurement method the contractor agrees to build the design that it is provided by the employer. The contractor has no responsibility for design. This method is appropriate for projects where the employers’ objectives have been clearly and comprehensively determined.
Design and build procurement can come in many forms, but the underlying basis is that the contractor takes on both design and construction responsibility. This allows the contractor to have more flexibility on design and allows the employer to place the financial outcome responsibility risk with the contractor.
The following seeks to explain some of the key advantages and disadvantages of both systems.
Traditional
Advantages
- Widely used and understood.
- Notionally a fixed price contract with cost certainty prior to start on site.
- Design complete prior to starting work on site. Clear understanding of scope.
- Independent design and advice to client.
- Variations can be readily accommodated.
- Competitive tendering providing an audit trail.
- Good control over quality by independent consultants.
Disadvantages
- Overall programme period from inception to completion generally longer.
- Contractor not involved in design process – potential for reduced buildability input.
- Full design should be achieved prior to tendering.
Design and Build
Advantages
- Single point responsibility for design and construction.
- Savings in overall time period from inception to completion compared with Traditional procurement route
- Option possible for client to employ design team for planning stage and initial design and then transfer to Design and Build Contractor. Gives Employer greater control over outline design.
Disadvantages
- Best suited to projects with works of a repetitive or simple nature. (Cost and size not necessarily relevant).
- Employers Requirements need to be carefully drafted to ensure completed building meets clients’ requirement. Quality may suffer if the design process is not monitored.
- Lack of cost control with the “moral hazard” of the designer and contractor being the same party.
- Concept precludes close control of architectural detail and finishes.
- Form of procurement does not favour introduction of changes.
- Typically a higher cost than a Traditional Tender due to the lack of competition and higher margins.
- Clients’ changes / variations can be costly. All costs should be benchmarked by an independent consultant.
- Supervision by Employer or his Consultants of work quality not recognised in concept.
- May not encourage innovative or optional design solutions.