Subcontractor Agreement Process
Steps in the Subcontractor Agreement Process:
- Conduct the Preconstruction/Estimating Hand-Off Meeting
This meeting ensures a seamless transition between the preconstruction/estimating team and the project management team. - Understand the Owner Contract
Familiarize yourself with all terms, requirements, and conditions outlined in the owner’s contract. - Prepare a Buyout Schedule
Develop a comprehensive timeline for subcontractor buyouts, focusing on trade-specific milestones and logistics. - Identify and Prequalify Subcontractors
Ensure that subcontractors meet all qualifications before bidding. - Develop a Complete Scope of Work
Define the detailed tasks and responsibilities to be covered by subcontractors to avoid overlaps or gaps. - Compile Documents and Exhibits for Bid Packages
Gather all necessary documents, including exhibits and additional requirements, for clarity in bidding. - Distribute Bid Packages to Subcontractors
Notify selected subcontractors while informing others who were involved but not chosen for final consideration. - Receive Bids from Subcontractors
Collect proposals and review submissions to ensure alignment with the scope of work. - Conduct Scope Review Meetings
Address subcontractor queries, clarify scope expectations, and identify follow-up actions. - Finalize Scope Leveling and Share with Stakeholders
Collaborate with senior project executives to finalize the award recommendation. - Submit Award Recommendation Package to Owner
Secure the owner’s signature or approval on the proposed award. - Notify Subcontractors of the Award Decision
Inform the successful subcontractor and issue letters to those not selected. - Submit the Agreement to Contract Administration
Ensure all documents are complete and approved for final execution. - Execute the Subcontract
Finalize the subcontract agreement and proceed with implementation.
Subcontract Purchasing Guidelines
1. Preconstruction/Estimating Hand-Off Meeting
Who: Project Executive, Project Manager, Assistant Project Managers, Senior Estimator, Trade Estimators.
When: As soon as possible before subcontractor buyouts begin.
Purpose:
- Transfer bid documents, strategies, and scope sheets to the project team.
- Review logistics, schedule assumptions, and any specific contract clarifications.
Details: Allocate 2-4 hours for this session. Address bid strategies, key subcontractor involvement, M/W/DBE requirements, and good faith efforts.
2. Owner Contract Review
Understand all contractual requirements and provisions to ensure compliance.
3. Develop a Buyout Plan/Schedule
Who: Project Manager, Project Executive.
When: Within two weeks after the hand-off meeting.
Details:
Create a buyout plan that aligns with the project schedule, including critical trade milestones. Include key factors such as material lead times, shop drawing approvals, and preconstruction activities.
4. Identify and Prequalify Subcontractors
Who: Project Executive, Project Manager, Prequalification Manager, Risk Management.
When: 2-4 weeks before bid package distribution.
Details: Use resources like isqft.com and internal tools to ensure all proposed subcontractors are prequalified.
5. Develop a Comprehensive Scope of Work (Exhibit A)
Who: Project Manager, Assistant Project Managers, Project Engineers.
When: Prior to bid package distribution.
Purpose: Define detailed scopes using estimating documents and standard templates to avoid overlaps or gaps.
6. Prepare and Send Bid Packages
Who: Project Team.
When: As required by the buyout schedule.
Details: Include all necessary exhibits (e.g., scope of work, project schedules, safety programs) and ensure clarity for subcontractors.
7. Receive and Summarize Subcontractor Bids
Compile all bids into a scope leveling document to compare proposals accurately.
8. Conduct Scope Review Meetings
Invite qualified subcontractors to review their bids, clarify inclusions/exclusions, and finalize scope agreements.
9. Finalize Scope Leveling and Internal Award Review
Align on the preferred subcontractor and ensure all prequalification and risk assessments are complete.
10. Submit Award Recommendation to the Owner
Include justification for the selected subcontractor, budget implications, and relevant adjustments.
11. Notify Subcontractors of the Decision
Communicate award decisions promptly to all subcontractors, ensuring transparency.
12. Submit to Contract Administration
Include all finalized exhibits, revisions, and approvals in the submission package.
13. Execute the Subcontract
Finalize all agreements, ensuring compliance with terms and readiness for project commencement.
This comprehensive process ensures efficiency, transparency, and alignment with project goals during subcontractor selection and award execution. All steps should be followed meticulously to uphold great company standards.
