Navigating Construction: Design-Build vs. Design-Bid-Build

by Alexander Fraser

When diving into the construction world, we often hear terms like “design-build” and “design-bid-build.” 

These project delivery methods are staples in the construction industry, with unique attributes. They offer different approaches to the process of bringing a construction project from conception to completion.

In this article, we will look at design-build vs. design-bid-build projects. You’ll learn what each one entails and how they differ. 

What is Design Build?

Design-build is a method where the design and construction services are contracted by a single entity, known as the design-build contractor. 

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Here, the design team and construction team work as one, promoting increased communication and collaboration. From preliminary drawings to construction activities, it’s all handled by the design-build team. 

Doing this provides a single point of contact for the project owner. 

Having a single point of contact can be a significant advantage or stress relief for the owner. If you are reaching out and talking with various designers and contractors, it will take up a lot of your time. 

A project manager on the design-build team who can convey all the information to you will save you a headache.

What is Design Bid Build?

On the other hand, design-bid-build involves separate contracts for the design process and the construction work. 

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The project owner contracts the design firm first, then a general contractor through a competitive bidding process. It’s a more segmented approach where design and build are handled by separate entities.

Key Differences Between Design-Build and Design-Bid-Build

The fundamental difference lies in how these two project delivery methods are structured. 

Design-build combines the roles of designer and contractor into a single entity, while design-bid-build keeps them separate. This distinction influences delivery, cost, quality, and other aspects of the construction process.

Design Build is a unified, integrated approach where a single entity, the design-build team, works under one contract with the project owner to provide design and construction services. 

This method offers collaboration between designers and builders, creating a solid alignment of project goals and objectives. 

Moreover, it often results in faster delivery due to the overlap of the design and construction phases.

On the other hand, design-bid-build is a more traditional method characterized by a clear separation of design and construction phases. This method involves two contracts – one with a design firm and another with a general contractor. 

This separation allows the owner to influence the design process significantly. However, it might also lead to extended project timelines as the bidding process and the construction only start after the completion of the design.

It’s common for a construction manager to be involved in design-bid-build projects. They will assist the owner with coordinating the project from design through construction. 

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Design-Build: A Deeper Look

The design-build process excels in streamlining the project. 

For example, consider the construction of a new local community center. Using the design-build method, the project manager and team members could identify and solve potential design issues during the design phase, avoiding costly change orders later. 

However, this approach can present challenges. With a lack of competition for the construction phase, the project owner might face higher initial costs.

Due to the nature of the design-build project, the owner cannot take the construction work to bid. They’re team that the design-build contractor provides to them. 

If the owner were to bid out the construction work, they could find a contractor at lower price. 

Advantages of Design Build

As mentioned design-build offers faster project delivery due to its streamlined process. With the building team involved, change orders are minimized, and the construction phase can begin earlier. 

The collaborative approach also leads to reduced costs as value engineering is applied from the very beginning of the project. The improved communication minimizes misunderstandings, thus enhancing the project’s quality.

Disadvantages of Design Build

Despite its benefits, design-build has its share of challenges. 

Since the work falls under a single design-build firm, you must research the company you select to ensure they are right for the project. 

You also don’t have the choice of the construction team to build your project. The project owner will be locked into a guaranteed maximum-price contract with the construction company to complete a defined scope of work. 

While you will be less susceptible to design changes with the owner and builder involvement, this doesn’t remove the possibility of a change order. When it comes to renovation work, you never know what you might find sometimes once construction begins. 

Design-Bid-Build: A Closer Examination

Design-bid-build offers clear benefits, especially with a well-defined project scope. 

Consider the construction of a unique architectural monument. The design process might be extensive and detailed, requiring specialized inputs from various experts. 

Once the design phase is complete, the owner can issue this to general contractors to begin bidding. The owner will receive quotes from numerous contractors looking for the lowest price. The owner must also keep the company’s reputation in mind when selecting. 

Advantages of Design-Bid-Build

With design bid build, project owners get more control over the design process. The owner’s involvement is required instead of having a single project manager monitoring the design phase. 

The owner has the option to hire a construction manager if they choose. They can aid in the entire design bid build process. 

The cost for design bid build work can be lower due to the competitive bidding for the construction contract. The reason is that the project owner has individual contracts with the design team and the general contractors, reducing risk.

Disadvantages of Design Bid Build

This method can lead to slower project delivery and potential cost overruns. In fact, construction could halt if the design isn’t complete or last-minute changes are made.

One risk is if the owner uses most of their budget during the design phase, they will still need to find the funds to pay for construction. Design-build will have a fixed price for the team managing the job. 

A potential downside is the risk of cost overruns. For instance, an unexpected geological issue might halt the construction work, leading to delays and increased costs.

Contractor involvement after the design phase could result in issues found after the fact. They will send in RFIs for design flaws, and the additional work for the contractor will result in a change order. You may be looking at a delay in the project as well. 

Conclusion

Choosing the proper project delivery method, depends on your specific needs, risk tolerance, and project complexity. Consider costs, time, and the importance of the collaborative approach or owner control. 

Whether you opt for design-build or design-bid-build, the choice should align with your goals for a successful construction project.

Choosing the Right Method

So, which method is correct for you – design-build or design-bid-build? 

To answer this, ask yourself the following questions. 

Are faster delivery and a single point of contact significant advantages for you? Then, a design-build contract may be the ideal option. 

Do you prefer more control over the design process, with the potential for cost savings from competitive bids? Then, design-bid-build might better suit your construction project.

Project Complexity

Also, consider the complexity of the project. 

If your project requires a specialized or unique design, design-bid-build would be the better option for the design process. Since you’ll work directly with the design firm, you’ll have more say in how they should create the plans. 

For a project with a standard design, or when speed is critical, design-build can expedite the construction process.

Owner Involvement

The level of involvement the project owner wishes to have is another consideration. 

Design-bid-build requires more involvement as you’ll contract and manage the design firm and the general contractors separately. 

In contrast, design-build provides a more hands-off experience for the project owner as the design-build team handles the entire project.

Risk Tolerance

Risk tolerance is another important factor. 

With design-build, there’s an inherent assurance of project completion within the construction schedule. Also, your chances of receiving a change order is reduced. 

On the other hand, with design-bid-build, the risk of bidding process delays and design changes can lead to extended timelines.

Risk Mitigation

Risk distribution is also different between the two methods. 

With design-build, the responsibility for the finished building’s performance rests solely on the design-build contractor. Since they take on the design, they must verify its constructibility before construction. 

In contrast, design-bid-build holds more risk for the owner. Without proper management, they could run into potential design issues resulting in changes before construction. It’s best to involve the design and construction firm during the design so both parties agree. 

I should mention that the design firm may be responsible for any financial ties should a change order arise from a design flaw. The contract will determine how much the firm is required to pay. 

Final Thoughts

In conclusion, design-build and design-bid-build are valuable project delivery methods in the construction industry. 

Each has strengths and challenges and serves different needs and project goals. By considering your project’s specific requirements and priorities, you can choose the right method for your next project. 

Remember, successful construction projects aren’t just about the finished product. They’re also about the journey, starting with selecting the suitable project delivery method.

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