Business Brief – 10 questions to ask your prospective fit-out partner
25 April 2019
Whether it’s a new-build or a refurbishment, transforming your office space is a fully integrated turnkey process and the decision requires careful consideration. Sector expertise and reputation aside, Peter Harris, Chief Financial & Operations Officer, JLL and Tétris South Africa, highlights the less obvious questions you should be asking to select the right design and fit-out partner.
1. Have you got insurance?
Your due diligence should include confirmation that all the relevant insurance policies are in place should anything go wrong during the project. Accidents happen, and you need to be sure you are covered – from a fire or an on-site injury to a non-compliant design element. It’s okay to request a copy of the various certifications, which could include professional indemnity, sub-contractor all risk, or workman’s compensation.
2. How do you handle health and safety?
Is there a dedicated in-house professional responsible for monitoring health and safety requirements? The answer will tell you very quickly how seriously the contractor takes health and safety and how they respect legislation and regulations. It’s particularly important if the fit-out is for a local branch of a global corporate, where meeting international standards is imperative.
3. Can you meet our timeframe requirements?
It’s good to ask what other projects the company has on the go and whether they have the necessary resources to commit to your project. This is particularly relevant if working towards delivery at the end of a lease. Global firms can ensure timeous project delivery with the use of penalty clauses, which are acceptable if the delay is the mistake of the contractor.
4. What’s your policy on furniture procurement?
Find out about pricing. Do they charge a mark-up? Are they willing to go with an open book policy? It’s best to agree on the margin mark-up upfront, for example, cost plus 10%. Often, an open-book contract with a specialist fee is better for the occupier than going out to tender on multiple fixed price contracts.
5. Can I have a draft copy of the fit-out works contract?
A review of the contract upfront and early can protect both parties if there are any ambiguities which can then be adjusted accordingly. A well-worded contract speaks to the professionalism of the contractor.
6. What is your BEE score?
A fit-out cost is a big spend for most businesses, so a healthy BEE score is good for business. While the spend is clearly capital in nature and can usually be written off over the duration of the lease for accounting purposes, the discretionary spend from a BEE procurement perspective is measured fully in that same year and so can have a significant effect on the overall BEE score in year one.
7. Are there any exclusions?
A quote could seem reasonable until you realise several big-ticket items (like air conditioning or electrical) have not been included. A professional quote should be prepared by a quantity surveyor based on technical construction drawings before signing a contract. Without it, you may well find yourself with an expensive variation order.
8. Does the Bill of Quantities meet expectations?
This is a detailed list of what will be provided and at what cost. To give you confidence, it can be worthwhile to take a line item, e.g. office chairs, and do a sense-check on quantities.
9. Can I see your references?
Do ask for them. Check specifically if the project finished on time and if the contractor was diligent in fixing snags. Some occupiers insist on a 5% retention fee until all snags are completed.
10. Is the design reflected in the cost?
Make sure what is presented at pitch stage is in line with budget expectations. It is easy to make a presentation look impressive without consideration to the parameters at play. A professional contractor will sensitise a presentation to ensure it meets the required brief.
This article first appeared in the April/May edition of Business Brief.