“The construction tsunami about to sluice through the economy may force property owners into new contracting models if they are to attract their building contractors and consultants of choice.”– Brian Clayton, Partner in Chapman Tripp, specialising in procurement, construction and infrastructure projects (‘Rebuilding Christchurch has nationwide repercussions’, IoD ‘Boardroom’ magazine, August/September 2013).
At Apollo we have a long-held preference to negotiate work with our valued clients, as opposed to tendering for jobs. We believe it provides the basis for a better working relationship, and allows us as the contractor to maximise our positive influence on a project right from the early concept stages – a contracting model known as ECI (Early Contractor Involvement).
The ECI approach is getting plenty of airtime in Christchurch at the moment as the Rebuild ramps up and pressure builds on resources (materials, trades and services) and margins.
As Brian Clayton points out in his article, “Contractors are hungry at present as they have geared up for the Christchurch rebuild and that work is not yet flowing. Soon, however, these dynamics will be reversed and they will be inundated with work, which will shift the bargaining power of the parties. It is even possible – perhaps even probable – that contractors may start declining to participate in traditional tendering methods with their high bid costs and no guarantee of success, because the market is going to be extremely hot.”
As the ECI option holds a number of mutual benefits for both client and contractor, taking this approach will mean a client is more likely to attract their preferred contractor by engaging them at the earliest concept stages, fostering a collaborative relationship. This has always been Apollo’s favoured approach as a contractor, becoming the client’s trusted partner, saving them time and money and encouraging innovation.
Additionally, as procurement of trades and materials becomes more difficult in an increasingly dynamic marketplace, Apollo’s new Strategic Alliance agreement with selected trusted consultants and contractors – to share supply chain information and give each other mutual preferential consideration for jobs and services – will allow us to continue to deliver certainty and quality outcomes for our clients as the Rebuild gathers steam.