No one understands products, brands and manufacturers better than the professionals responsible for installing products on the job site. As electrical contractors, your experience—and the experience of your trusted electricians and cable technicians—tells you which products, brands and manufacturers deliver and which ones fall short.
In years past, you had to deal with whatever was specified by someone up the food chain, even if you knew the product was junk. Today, your opinion about products, once an afterthought when something went wrong, is valued like never before.
As an electrical contractor, when you work in a design/build or design/assist capacity, the general contractors (GCs), owners, engineers and architects who hire you increasingly trust you to specify the products and brands you will ultimately install. The notion of the electrical contractor being nothing more than an “installer” is antiquated and quickly fading from the construction psyche with each successful project.
A nationwide trend reinforces that change in mindset. Increasingly, electrical contractors carry more weight when it comes to deciding brands and manufacturers. Perhaps that is because GCs and owners have been burdened with callbacks and change orders in the past. Perhaps it is a way to shift responsibility to the people closest to the installation.
Owners and GCs are handing off specs in design/build partnerships with electrical contractors, in part, because the liability lies with you. In a design/build contract, the electrical contractor takes on more liability if something goes wrong. Therefore, you should not be asked to install inferior products and still shoulder that burden. Increasingly, you might have more responsibility when it comes to specifying products, but that responsibility comes with a risk. You must specify products from brands and manufacturers on which you can stake your reputation.
Recent design/build and design/assist research points to an increased role of electrical contractors in the specification of products and brands. According to a 2005 survey conducted by the Washington, D.C.-based Design-Build Institute of America (DBIA), design/build work in nonresidential design and construction in the United States is racing toward a monumental collision in 2010. The institute’s research indicates traditional design/bid/build work will account for 45 percent of projects while design/build will account for an equal percentage, marking the first time the two construction methods will be on equal footing. The remaining 10 percent will be done in a construction management method.
When you look at historical data beginning in 1985, it is easy to see the significance of 2010. In 1985, about 80 percent of all construction was conducted on a design/bid/build basis. The budding design/build contract method accounted for a mere 5 percent at the time. Ten years later, the gap had closed, with 65 percent of the work done the traditional way and design/build work accounting for 25 percent.
The DBIA’s projections indicate that 50 percent of nonresidential design and construction in the United States will be done on a design/build basis by 2015. Juxtaposed with that trend, design/bid/build work, which stood at 50 percent of the market in 2005, will shrink to 40 percent in market share. In other words, the two types of construction methods will have effectively switched places—with design/build taking over the majority of jobs.
If this trend continues—and there is no indication that it will not—by 2020, it will be a 60-30 split with design/build dominating market share. This is the direct opposite of the market-share breakdown circa 1997. Crystal balls aside, we clearly can follow the trend and see more design/build work for electrical contractors moving forward. One of the leading fuels for this design/build trend is profitability.
According to ZweigWhite’s 2004 Design/Build Survey of Design & Construction Firms, 70 percent of firms surveyed believe design/build projects are more profitable than traditional projects. That profitability factored into 80 percent of the respondents predicting an increase in design/build construction over the next five years. Simply put, higher margins through design/build feed the bottom line better than traditional design/bid/build work.
According to recent original research conducted by Renaissance Research & Consulting for ELECTRICAL CONTRACTOR magazine, 43 percent of electrical contractors’ revenue came under either a design/build or design/assist banner. The vast majority came from design/build work rather than design/assist.
The overall trend that shows an upturn in design/build activity also lends credence to electrical contractors’ expanding their role as specifier. Your reputation and qualifications to work in a design/build capacity are critical in an owner’s selection process. Your design/build success, therefore, will land you more design/build jobs. Your ability to specify the right products that deliver the desired result can make the difference between success and litigation. Through ELECTRICAL CONTRACTOR surveys, we are able to drill down into this trend to determine how much influence ECs have on specifications.
Completeness of plans and specs
In 2006, this magazine commissioned research to explore the evolving role in design/build and design/assist projects among electrical contractors. The results speak volumes. For each of the building types—single family, multifamily and commercial/industrial and institutional (CII)—ECs who work on a design/build or design/assist basis are significantly more likely to say the plans and specs they now receive are less complete compared with what they received five years ago. This information confirms the integral role ECs who provide design services play in today’s construction projects.
In comparison, electrical contractors who do not provide design services are more likely to say plans and specs for single-family and for CII projects have not changed in the past five years. Note that neither group is significantly different from the other on plans and specs that are more complete.
More than 20 percent of electrical contractors who work on residential projects say the plans and specs they receive are less complete than what they received five years ago. More than half say there is no difference, and 20 percent say the plans and specs are more complete. Among those who work in this area, 30 percent say CII plans and specs are less complete than they were five years ago, while 40 percent say they are no different. Less than 20 percent say those CII plans are more complete.
On average, a single brand is specified only 20 percent of the time. In all other cases, other factors come into play. It is also worth noting that a single brand specification is far more common among firms with fewer than 10 employees than among larger firms.
Electrical contractors increasingly have discretion when it comes to specifying brands. Survey respondents said they are able to make brand substitutions about 70 percent of the time, which translates into GCs and owners trusting their electrical contractor partners to make the right decision on substitutions. Seventy percent is a very substantial number when you look back in time to when design/build was such a small part of the overall construction market.
Brand and manufacturer when configuring
When working on or designing systems where a multiple, equal to, or performance specification is indicated, how often do electrical contractors try to stay within a single brand or single manufacturer? The 2006 Profile of the Electrical Contractor survey asked that question. Regardless of company size, 45 percent of the respondents said it depends on the situation.
The remaining 55 percent differs by company size; smaller firms are significantly more likely than their larger counterparts to try to stay within a single brand. Companies with 10 or more employees are more likely to say they try to stay within a single manufacturer.
Original selection and substitution
Availability and price are the top reasons for “original” brand selection, according to the research. Seventy percent of electrical contractors selected each of those two categories as either their first, second or third reason for initially selecting a brand. Ease of installation, prior experience, durability and manufacturer reputation form a second tier of reasoning (each was chosen by 40 percent or more as a top reason for initial brand selection).
Availability and price also are the top reasons for brand substitution. However, in this case, availability eclipses price. Availability and price are more important as reasons for substituting a brand than for its initial specification. Conversely, ease of installation, prior experience, durability and manufacturer reputation assume higher importance. Time considerations play less of a role in the original brand selection than they do in substitution, for obvious reasons. Specific features assume more importance when making a substitution than in the original specification.
These findings underscore the significance that product, brand and manufacturer play among electrical contractors in the design/build arena. ECs are very loyal to the products, brands and manufacturers that have served them over the years in their businesses. If a manufacturer delivers a product that contractors have grown to use and trust, that brand and manufacturer likely will get the nod the next time the contractor has to make a decision.
What also is clear in all this data is that electrical contractors are more critical to overall design/build success than ever before. With design/build work becoming a majority of the overall market in the foreseeable future, electrical contractors will be counted on to specify the right products and, therefore, make design/build projects move more smoothly to completion. It is both a challenge and an opportunity. Are you ready to capitalize on it? EC
KELLY, former editor of ELECTRICAL CONTRACTOR, is a Baltimore-based freelance writer. Reach him at firstname.lastname@example.org.