Comparing contractor quotes on the same basis

Six recurring differences make the totals unreadable. Each of them can shift the total more than any difference in unit price.

• Quantities. If each contractor measures areas, volumes and lengths for itself, the totals contain different measurements. A contractor that counts fewer square metres of plaster is not cheaper: it has read less work.
• Missing items. Waste disposal, scaffolding, builder's work in connection with services, final cleaning, temporary connections: these are the items a summary preventivo (contractor quote) most often forgets, and they reappear on site as extras.
• The form of price. A lump sum quote, a corpo, offers an overall price for a described piece of work; a measured quote, a misura, applies unit prices to quantities that will be measured and accounted for. The two do not respond to the same risk, as the page on choosing between a lump sum and a measured contract explains.
• Exclusions. "Excluding anything not expressly stated" is the most expensive line in many quotes. Exclusions must be listed, not assumed.
• Safety and site conditions. How safety costs are treated, who provides scaffolding and site huts, who pays for site power and water: these conditions weigh on the price and vary from one quote to the next.
• VAT and payment terms. Totals with and without VAT, advance payments, instalments tied to dates rather than progress, how long the quote remains valid, completion times: everything that is not price still affects the cost to the client.

The decisive step is to give every contractor the same unpriced bill of quantities. The computo (bill of quantities) lists the work items with their description and quantity, leaving the price column blank. Each contractor fills it in. The result is quotes with the same structure, which can be read line by line.

The item descriptions do the most important work. An item reading "porcelain stoneware floor" says nothing about format, laying, skirting or screed. A well-described item leaves the contractor nothing to decide but the price. For reference descriptions and prices, the page on the unit price list and the page on price books for private construction show how to build them.

Alongside the bill, every contractor receives the same conditions. A short request-for-quotation letter sets out what is not in the bill: the form of price required, the date by which to respond, the minimum period of validity, completion times, the payment terms proposed by the client, and the obligation to state exclusions and proposed alternatives in a separate section. A contractor wishing to propose a different solution does so separately, without altering the base items.

Questions are asked in writing and the answers sent to everyone. If one contractor asks for a clarification on the design, the answer applies to all. It is the only way to avoid one contractor allowing for an item of work and another not, on the strength of a conversation.

The table has one row per item in the bill and one column per contractor, plus a column for the client's estimate. Read the empty rows first, then the gaps, and the totals last.

Empty rows are normalised. If a contractor has not priced an item, it is completed with a reference value, usually the estimate or the average price of the other bids, with a note that the normalised total is a reconstruction. In the same way, any added items the bill did not ask for are removed. The normalised total is the one that is compared.

Large gaps on a single item are questions, not answers. A price far below the estimate on a major item may mean a misreading, a different solution or a price the contractor intends to recover elsewhere. The question must be put in writing before choosing. When the gap concerns the bid as a whole, the subject becomes that of the bid that is too low as a budget risk.

Totals are read last. Only after normalisation does the difference between the totals genuinely measure the difference in price.

The example is entirely fictitious, with amounts excluding VAT. For the renovation of a flat, the client receives three quotes. Contractor A responds on the bill and adds an item that was not requested; contractor B uses its own template and leaves out two items; contractor C responds on the complete bill.

The reading changes completely. On the stated totals, the difference between the dearest and the cheapest is 14,000 euros and B looks the obvious choice. On the normalised totals, the difference falls to 3,000 euros and the cheapest is C. Had the client signed with B, waste disposal and scaffolding would have arrived on site as additional requests, at a price no longer negotiated under competition.

Whatever has no price in the quote is decided by someone else. Where no consideration has been agreed and there is no way of determining it, the civil code refers it "to existing tariffs or to customary practice", and failing that the court sets it (art. 1657 of the civil code, unofficial translation). Every item of work allowed for but not priced is a cost the client does not control.

A lump sum quote on a vague design paves the way for variations. If the price of the whole work is fixed as a lump sum, for agreed variations the appaltatore (the contractor) "is not entitled to payment for the variations or additions, unless otherwise agreed" (art. 1659 of the civil code), and the authorisation "must be proved in writing". But variations ordered by the client within one sixth of the price must be paid for even under a lump sum (art. 1661). The more incomplete the design at signature, the more clarifications will turn into ordered variations, and the less the lump sum price protects than it seems. The full regime is in Variations in a private building contract: agreed, necessary, ordered.

The priced bill becomes an annex to the contract. Signing with the chosen contractor's priced bill, rather than with a summary quote, gives every future variation an agreed price reference. It is also the basis for measuring progress and for recognising, item by item, what has been carried out.

The number of contractors affects the total cost. If the comparison leads to awarding work items to different contractors, coordination, interfaces and safety obligations change: where several contractors are expected on site, even not at the same time, the client appoints the safety coordinators (D.Lgs. 81/2008, art. 90(3) and (4); for private works not subject to a building permit and below 100,000 euros, para. 11 removes only the design-stage coordinator). That choice is covered in General contractor or separate trades: the effect on the budget.

• Asking for a "preventivo di massima" (a ballpark quote) and signing it as if it were a bid. A summary quote helps to understand the order of magnitude, not to commit: before signature it must be turned into a priced bill.
• Changing the design during the consultation without telling everyone. Any change communicated to one contractor alone makes the comparison useless. The new version must be sent to all of them, with a new deadline.
• Comparing time and price separately. A dearer contractor that guarantees shorter completion may cost less to a client who is paying rent or financing in the meantime. Completion times and payment terms belong in the comparison.
• Choosing on the total and negotiating afterwards. Once the contractor is chosen, the client loses the lever of competition. Questions and negotiations happen while the contractors are still competing.