When it comes to embarking on a construction project, choosing the right procurement method is crucial to its success. One of the options available to project owners is management contracting. In this article, we will explore the ins and outs of management contracting procurement method contracting, its advantages, and disadvantages, helping you make an informed decision for your next construction project.

What is Management Contracting?

Management contracting is a procurement method where the project owner appoints a management contractor to manage and coordinate the construction works. The management contractor acts as an intermediary between the project owner and the various trade contractors working on the project. This method is often used for construction management procurement method advantages and disadvantages and fast-track projects where early construction starts are required.

Advantages of Management Contracting

1. Early Involvement of Contractor: One of the key advantages of management contracting is the early involvement of the management contractor. This allows for input during the design stage, helping to identify potential issues and find solutions before construction begins.
2. Greater Flexibility: Management contracting offers greater flexibility compared to traditional procurement methods. Changes can be made more easily during the construction phase, allowing for adjustments to be made based on project requirements.
3. Competitive Tenders: Trade contractors are appointed based on competitive tenders, ensuring that the project owner receives the best possible price for the construction works.
4. Faster Construction: Management contracting can lead to faster construction times due to early involvement and better coordination between trade contractors.

Disadvantages of Management Contracting

1. Cost Uncertainty: One of the main disadvantages of management contracting is the potential for cost uncertainty. As trade contracts are awarded based on competitive tenders, the final project cost may vary from the initial estimates.
2. Increased Risk: With multiple trade contractors working on the project, there is an increased risk of coordination issues and disputes between parties.
3. Complexity: Management contracting can be more complex than traditional procurement methods, requiring a higher level of coordination and oversight.
4. Limited Control: Project owners may have limited control over the day-to-day management of the construction works, as this responsibility lies with the management contractor.

Conclusion

In conclusion, management contracting is a procurement method that offers both advantages and disadvantages for construction projects. It provides early contractor involvement, greater flexibility, and competitive tenders, but it also comes with cost uncertainty, increased risk, and complexity. When choosing the right procurement method for your project, it is essential to weigh the pros and cons carefully and consider your project's specific requirements. By understanding the intricacies of management contracting, you can make an informed decision that will set your construction project up for success.