What are the Advantages of the Design-Bid-Build Delivery Method?

If you’re about to embark on a construction project, choosing the project delivery method is one of the most consequential decisions you will have to make. A delivery method is a system selected by the owner to organize and manage a project’s design, construction, and maintenance. It also outlines the contractual relationships between the owner, architect/engineer, and contractor, stipulates each party’s responsibilities, the timing of their participation, and the ownership of deviations from the approved design. 

There are several delivery methods for construction projects, each with its pros and cons. The most common ones are:

  • Design-bid-build
  • Design-build
  • Construction management at risk
  • Integrated project delivery

The method is straightforward enough for homeowners to stay on top of and understand. Owners can be fully engaged in the design process, while the design team and the contractor’s roles are more autonomous, and the responsibilities of each function are better defined.

Design-bid-build is the traditional low bidder model and is one of the most popular delivery methods. With this approach, the project owner establishes separate contractual relationships with the design team (architect and engineer) and the general contractor (GC) who will perform the construction activities. The method roughly follows the stages below:

1. The Design Stage

The architect and engineer produce a bid set, which typically includes but is not limited to, a site plan, architectural, structural, mechanical, electrical, and plumbing drawings; often, the same drawing package is submitted with the permit application. The design progresses in consultation with the owner, and with coordination between the design disciplines.

2. The Bidding Stage

Once the drawings reach a point where the owner can expect a realistic quote from GC candidates, the project enters the bidding stage. General contractors, whether pre-qualified or not, are asked to submit their bids based on the drawings issued. Each quotation gets reviewed, and if no estimating errors are found, the contract is awarded to the lowest bidder. The contract is typically lump sum and has a fixed price to which the contractor commits.

3. The Construction Stage

With the contract awarded, the lowest bidder builds the project. Because the bidders are bound by the price in their quotes, the contractor typically absorbs most cost overruns that may emerge during construction. That said, while the contractor takes responsibility for the price, the owner, through their contract with the design team, is liable for any design changes that may impact the price. Such design modifications typically result in a change order.

During construction, the designer of record (either the architect or the engineer) gets retained to perform contract administration services, which include:

  • Request-For-Information (RFI) management,
  • change order and substitution request review
  • construction submittal review
  • payment certification

What are the advantages of the Design-Bid-Build method? 

The method is straightforward enough for homeowners to stay on top of and understand. Unlike the design-build delivery, there is less collaboration between the design team and the GC, and thus design changes are easier to track. Owners can be fully engaged in the design process, while the design team and the contractor’s roles are more autonomous, and the responsibilities of each function are better defined.

The design team acts on behalf of the owner, rather than sharing an interest in the venture with the GC. Therefore, the design professionals have an incentive to design a quality building and oversee that their design requirements get implemented during construction.

In addition, the design team becomes more active in the construction administration role in this method, allowing for more clarity in the contractor’s interpretation of the design requirements, and better overall achievement of the owner’s design intentions.

Because the design, bidding and construction phases occur in sequence, scheduling is simpler to control. While minor design changes are almost inevitable even after construction starts, the contractor can draft their construction schedule based on firm design drawings.

Owners have the chance to review bids, and the costs outlined in each quotation. The contractors’ estimates can be more accurate, as by the time they’re bidding on the project the design documents are well developed.

Thanks to the popularity of this approach, most GCs are quite familiar and comfortable with its procedures.

What are the disadvantages of this method? 

Due to the method’s linear nature, cost-based design changes are less flexible. Architects and engineers miss out on GC’s valuable cost feedback, and if all the bids come in over budget, the design team has to get back to the drawing board to look for value engineering opportunities. Only then can bids be re-solicited. This lengthy redesign process delays the project start date. In contrast, the design-build approach allows the contractor to give ongoing cost-related feedback to the architects and engineers as the design evolves, thus tailoring the project to its budgetary expectations.

The design-bid-build method also denies specialty subcontractors a chance to offer their input into the design. This lack of specialized expertise may lead to higher costs or even errors on the part of the design team.

Because in the design-bid-build method, all the phases of a project occur in sequence, a delay in one phase can have a domino effect on the entire project.

With the design-bid-build method, the lowest bidder wins the contract. Each GC submits his/her lowest possible number, and any inconsistencies or errors in design can create an incentive to request change orders. Because bidders are chosen based on price, quality of construction may be compromised.

When is the design-bid-build method right for your project? 

In recent decades, the design-bid-build method has seen its credibility and popularity challenged thanks to some of the disadvantages described above. The design-build, construction management, and integrated project delivery methods all offer better collaboration between the project stakeholders and emphasize a balance between quality and cost-efficiency.

With all the above being true, there are still reasons to opt for the traditional design-bid-build method:

1. If your project is simple, and design challenges are not expected, you can benefit from the lowest possible construction costs and a precise schedule.

2. If you prefer a compartmentalized process where each party is responsible for their individual role while ultimately reporting to you, then the design-bid-build method is well-suited to your needs.

3. If you prioritize cost efficiency over the overall length of the construction process, this method fits well with your expectations.

How Design Everest can help

If you’re involved in a construction project, our team of engineers can help with all aspects of civil, structural, and MEP design. We also offer architectural drafting, 3D modeling and rendering support, Title 24 and CalGreen calculations, and construction administration services. Contact us at (877) 892-0292 to discuss your project and receive a quote today.

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