As a General Contractors you are responsible for building most of the structures and facilities that we use including our schools, hospital, offices, homes and places we eat. You are regularly tasked with managing owners, subcontractors and suppliers to from project planning to completion. Planning, supervision, risk management and cash flow are vital parts of making you successful.
MG Surety Bonds understand General Contractors. We know that bonding may be one of the most important parts of your operations. Access to bond capacity can mean getting more work to keep your company profitable and your people employed. You don’t always know where the next project will come from so it’s important that you can keep bidding and keep picking up new work. We can help. Whether you have $500 million in backlog or need your first bond, we are here for you. We are licensed in all 50 states and will work to get you a quick approval.
General Contractor or Construction Manager?
This can often be a difficult distinction but its important to understand the roles of each. General Contractors typically employ their own workforce such as superintendents, project managers, estimator and possibly labor. Many General Contractors have specialties and may “self-perform” some of the work such as concrete, carpentry, ect. The real difference in most contracts though is the relationship with the Owner and who bears the risk and reward of the contract. A general is usually required to submit a bid for the project. If awarded, the General Contractor must see all aspects of the project through completion and bears the financial risks and rewards. The GC does not share their estimates with the Owner. If they build project for less than the contract price, they profit. The opposite is true if the project goes south.
In a Construction Management relationship, the CM works very closely with the Owner throughout the project. The CM is usually chosen on qualifications and gives the Owner their fee for the project. They then openly share the costs of the projects with the Owner as the project progresses. However, many public entities such as school districts may utilize Construction Managers and put them “at risk”. Usually a CM at risk contract will have a Gross Maximum Price. If the costs exceed the Gross Maximum Price, the CM is on the hook. Usually these contracts have a savings provision as well which allow the CM a percentage of the savings if the final amount is less than the Gross Maximum Price. This setup protects the Owner from overages and may have to be bonded. General Contractors often act as Construction Managers depending on the project. MG Surety Bonds works with both General Contractors and Construction Managers.
Design Build Considerations
As a General Contractor, you will likely be asked to perform Design Build work now or in the future. According to FMI, Design Build construction will grow by 18% by 2021 and account for half of all construction. As a General Contractor, you need to be working with a broker that understands how to bond these projects and the risks associated with doing so. We can help. We work with bond markets that understand General Contractors and design-build risks. We will design a surety program to help you capitalize on this growing market.
How Do You Compare to Others?
Have you ever wondered how you stack up to the competition? How much is their overhead? What are their margins? How much of their work is subcontracted? What about over and under billings? MG Surety Bonds has access to real time data. It allows us to give general contractors a benchmarking report for the industry based on your size and NAICs code. We can also take your financial information and stack it against the competition. These reports are available free to our general construction customers.
We want to be your bond broker for life and will give you the surety credit you need to building your business and be successful.