Choosing an Office Fit Out Company
If you are choosing a design & build company, a key step will be due diligence. But what do you actually need to check as part of this process? In this article, we’ll explain the 8 key steps of due diligence for office design & build. By the end of this article, you’ll know how to thoroughly vet a potential contractor. You'll be able to decide whether they are capable of delivering your project.
Due diligence won’t help you choose the best office design & build company for your project. However, it does eliminate unsuitable companies and identify key areas of concern for others. If several companies pass your due diligence process, then you will have to choose the best office fit out company.
Stage 1: Initial Due Diligence
The first 4 steps of the due diligence process are known as initial due diligence. You will go through these steps when you are shortlisting companies.
1) Assess Their Portfolio
A Design & Build company’s portfolio is a helpful indicator of how suitable they are for your project. By assessing the projects they have completed, you will get a good idea of what they are capable of and what they specialise in. Key things to look at in their portfolio include location, project size (sq/ft), project type and client industry.
When reviewing a potential contractor's portfolio, it’s essential that you consider how it's relevant to your project. They may have done some amazing designs for iconic companies. However, that doesn’t mean they are experienced in delivering the kind of project you require.
2) Appraise The Package
As part of your due diligence process, you should go through your quote and scope of work in detail. This will help you make sure you understand everything that is (and is not) included in your quote. This includes studying all specifications and quantities.
It is also important to compare your quote with the design package. Some fit out companies will omit parts of the design from their quote to reduce the initial cost, and then charge you for them throughout the project.
3) Assess Aftercare Package
Another crucial indicator of a fit out company is their aftercare package. What systems and provisions do they have to ensure your ongoing satisfaction after the project is complete? This should include clear processes for resolving issues, as well as proactive scheduled visits.
If a fit out company does not have a well-defined aftercare package and clear customer satisfaction process, this is a significant drawback. It indicates that they do not have the systems in place to take care of you post-project, or that their work may not be high-quality.
4) Ask For References
When conducting your due diligence, you should ask your shortlisted fit out companies for references from their previous clients. If possible, these references should be for companies with a similar brief to yours.
References are much more helpful than testimonials because they provide an unbiased opinion from a customer's perspective. You can also ask follow-up questions. If a fit out company is reluctant to give you referrals from similar projects, it signals that they do not provide a good customer experience, regardless of the cost or quality of the design.
Stage 2: Detailed Due Diligence
Once you have chosen a preferred fit out company, you will need to conduct further due diligence to ensure they are suitable. Only doing this with one company saves a lot of time and effort.
5) Review Policies & Accreditations
The first stage of detailed due diligence is to review the policies and accreditations of your preferred fit out company. Accreditations to look for primarily include design and project-management certifications, such as RIBA, ISO, and SafeContractor. You should also review the formal policies of your fit out company, including sustainability and CSR.
Accreditations don’t necessarily guarantee that your fit out company is the best option. However, they do give you the confidence of third party verification. Policies will help show that you are dealing with an established and reputable company with the structure in place to deliver your project successfully.
6) Review The Contract
As early as possible, you should get an initial contract in place and review the terms. This should be done with the help of a specialist lawyer. Key terms to look for are pricing structure, contract variation processes, timeline assurances, dispute resolution, and liability.
At this stage, you don’t necessarily have to get into detailed legal negotiations with the fit out company. However, establishing your contractual red-lines early on will save a lot of time planning a project, for it to fall apart at contract negotiations.
7) Understand Communication Structure
An often overlooked part of due diligence is understanding the communication structures during the project. Aside of formal contractual provisions, you need to know how you will communicate on a regular basis. Especially important is how they will be accountable to you throughout the delivery phase of the project.
Good communication throughout the project is essential. This will enable you to know exactly what is going on site and make your project much less stressful. If your fit out company is reluctant to commit to regular meetings, site updates, and tours, then their delivery may be disorganised and chaotic.
8) Assess The Company’s Financial Health
Assessing the financial health of your preferred contractor is an essential part of due diligence. Some of this information will be provided by the contractor. You should also be able to get the information you need from independent sources such as Companies House and CreditSafe.
You need to be comfortable they are in a financially stable position. If they encountered financial trouble, your project would encounter significant disruption. Things to look at include company age, available capital, liquidity, debt, and the red flag indicator.
Aside of financial health, you should also consider their resource. Ideally, your fit out company should have revenues between 3 and 20 times your project. Any smaller than this, and they may not have the systems and capital to handle your project. Any larger than this, and your project may not get the attention it requires.
Choosing Your Office Fit Out Company
Choosing the right design & build company is absolutely crucial – it can define whether your project is a success or failure. The right contractor will have the skills, resource, and approach to deliver your project on time, on brief, and on budget. Choosing the wrong contractor could lead to huge cost overruns, long delays, an inappropriate design, and/ or a stressful, adversarial project. They could even have to terminate the contract partway through, throwing your project into complete disarray.
Now that you know the key steps of due diligence, you’re able to thoroughly vet any potential design & build company. You’ll also be able to eliminate any unsuitable options and identify areas of concern for any suitable company. This will ensure you don’t choose an unsuitable contractor, putting your project success at severe risk.
If your due diligence process eliminates all your potential contractors, you shouldn’t just choose the best of the existing options. It may seem a lot of work to go through the identification process all over again, but it will save you a lot of time and hassle later on.
Once you’ve eliminated unsuitable candidates, the next step is to choose the best fit out company. To learn how to do that, read this article. It explains the 4 key areas to consider when comparing options, and how to make a structured choice.