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Maintenance and Service Contracts.
The Golden Rule Applied to Contracts.
 


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Maintenance and Service Contracts . . .

          Part of the daily life of a building manager is to deal with independent service providers. A building manager might have any number of contracts for the maintenance and service in all departments of a commercial building. Typical contracts for service include elevator maintenance, fire extinguisher service, fire sprinkler upkeep, exhaust hood cleaning, exterior grounds keeping services, interior plant care, window washing, kitchen appliance repair, security, telephone maintenance or computer maintenance.

           No matter what the contract or service, the need of the building manager is the same: to have a contract with a service provider who reliably performs quality work at an appropriate price.

An APPROPRIATE Price.

           Building owners and Executive Committees have a mandate to manage the cost of building operations, the building maintenance, marketing and finances. But often, this mandate is carried out by simply pressuring the building manger to keep expenses as low as possible.

          Routinely selecting the lowest bidder for any service contract can be a costly mistake. A service provider that isn't well compensated for the services rendered will naturally offer a lower quality service. Every vendor knows one way to get a foot in the door is to "low-ball" the contract bid. Then, after the competition is eliminated, MAC's (additional invoices for MOVES, ADDITIONS & CHANGES above and beyond their contract specifications) make the contract profitable. .

           Independent service providers will offer different levels of services for different prices. Because of the specialized or technical nature of the most of the maintenance services, building owners and/or members of the Executive Committee frequently have no idea what services they are supposed to get for the price they are paying. It is up to the building manager to make sure each contractor performs according to the contract specifications The trick for the building manager is to write a contract that specifies the exact work to be done with specific information regarding equipment, quantity of work and quality of work without hampering the effectiveness of the contractor.

           An extremely specific contract would certainly be desired in, say, a construction bid or an independent audit proposal. But, for instance, if a grounds-keeping contract is written too "tightly", it might actually inhibit a landscaping contractor from taking any initiative in suggesting alternative plantings. If a service provider working under a tight, very specific contract is submitting lots of MAC's every billing period, the building manager might be wise to re-write the contract to make it more inclusive at a higher cost to the building manager. Crafting a "loosely" written contact that would cover the ebb and flow of normal business without continual moves, adds, changes added or "extra's" to the regular billing saves the Building Manager from having to review MAC's every month and allows service provider some flexibility.

           Both sides, the building owner and/or the executive committee and the independent service providers should discuss all the details of a proposed contract before it is finally drafted. Every building is different. Therefore, when a independent service provider is asked to bid, they need to know the requirements of the building before they can adequately offer a proposal. At the same time, the building owner and/or the executive committee members need to know the exact services provided if they are to compare one bid against another.

           The formula for successful contract administration is as simple and as difficult as this:   Write a good contract. Treat your contractors with dignity and respect. Pay them what they are worth. Demand performance. As a building manager, you should not accept less from your contractors than what is needed. If you do not feel that you are getting adequate service, ask for it. On the other hand, be willing to pay for the services you ask for. If you want quality service, expect to make an adequate payment for that service. If you become successful in applying this formula, you will soon find that you are no longer wading through heaps of MAC's at the end of the month, that contractors are more willing work for you and your contract expenses have become uniform and predictable.

03.10.25






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