An at-risk main contractor with a dozen separate developer clients, his everyday site management problems, diverse supply chain to fund, his bank manager to placate and a profit to make [or loss to avoid] is not likely to view his partner’s project manager or QS other than as a potential for injury by friendly fire.
Although not rocket science, constructing a building is a fairly complex exercise tackled competently by most contractors. But for the professional builder, the building is not the problem. An endemic problem in the industry is the suspicion inherent in a system dependent upon non-targeted development funds, controlled by at-risk contractors, failing to flow smoothly, or at all, down the supply chain. The arrangement isn’t conducive to peace and goodwill leading to high productivity within the construction team.
A developer’s interests are clearly best served if his construction team, including suppliers, is as confident as possible of receiving the vital cash supplies on time and is free to direct its energies to achieving his, the developer’s, aims as quickly and economically as possible. Contractor and suppliers best interests are served when the main development funds are fully in place, ready for draw down before the start, ring-fenced and directed to the individual trade contractors and suppliers as and when certified for payment.
Construction contracts are fraught with problems and, whichever way the process is managed, they won’t be eliminated entirely. However, improving cash flow in the supply chain by avoiding the interest vested in retaining funds, on both sides, is a good starting point.
David Taylor, Management Construction, via email.