Negotiating with a tenant buildout company is an integral part of the buildout process. Since you are usually limited by a certain amount, it’s vital for the negotiations to go smoothly.
Tenant buildout companies often work on several projects simultaneously. To take on your small or medium-sized buildout job, it needs to be financially motivated. While both parties want to be in good financial shape after the project is over, you need to know what to bring to the negotiation table to come out as a winner.
1. Get Several Estimates
Before you start negotiating, you need to have a good idea of how much your project costs. For that, you should consider getting an estimate from at least three other buildout companies.
When comparing these contractors, the cost is usually the deciding factor. Make sure to pay special attention to other parts of the offer. If another company offers a lower price, you can take advantage of this information to negotiate the cost of the project.
As you learn about all aspects of the build-out process, you can understand when and where it’s appropriate to negotiate.
2. Talk about the Competition
One of the worst things you can do at the negotiation table is to look desperate. To get a better price, you need to show that you are choosing between several companies. Mention the competition and talk about what it offers.
According to tenant build-outs experts , you may not get the price reduction you hope for but receive some extra services instead. To carry on such a conversation, you need to do extensive research about different companies that offer buildout services.
You should also do sufficient research to talk about the specifics of each job. Your knowledge and expertise can show the company how serious you are about the project. This can lead to achieving better results at the negotiation table.
3. Consider Cash Payments
Cash payments are always appealing to contractors. If you can pay for work with cash, use it to your advantage. Some buildout companies may be willing to reduce the price when you offer a cash payment.
It’s possible to get up to a 15% discount by making direct cash payments to the company instead of making it wait for the money to arrive through other channels. Just make sure you verify the contractor’s taxpayer ID.
4. Ask for Credentials and Documentation
Before you sign a contract, you are in a position to request all the necessary information to help you make the right decision about hiring a company. Once the contract is signed, the contractor loses the reason to provide you all this data and documentation. In fact, your requests may be completely ignored.
Ask for licenses and references, and make sure to call and check their validity. If you find that something is wrong, you can save yourself a lot of time at the negotiation table.
5. Check Other Past Clients
When the buildout specialist gives you references, they come from their most satisfied clients. To make sure you get the full picture of the company’s abilities and experience, check with other clients as well.
The information you gain when speaking with these people can help you make the right choice. Additionally, you can learn something to make negotiations easier and more beneficial for you.
6. Don’t Reveal Your Budget
Before setting a price for their services, many tenant buildout companies want to find out how much you are willing to pay. Don’t reveal this information. If your job costs $3,000 and your budget is $4,000, when the contractor hears your budget expectations, the job’s price will soar.
Make sure to get the numbers from the company first. It’s sufficient for you to share what you want to get done. When it processes your requirements, the company can give you an approximate price. Your budget is an unnecessary piece of information at this stage.
7. Structure Payments Well
If you are planning a sizeable buildout project, you are likely to pay the contractor in installments. Make sure to structure them so they are evenly spread throughout the project. By paying the contractor too much too early, you are risking a poor outcome at the latest stages of the job.
Final Thoughts
Negotiating with tenant buildout companies requires a lot of research. To make sure you are getting a fair price, get at least three estimates, learn how much different parts of the project cost, and consider making cash payments.
