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Broker or Contract Manufacturer for Your Steel Building Project

Posted in: Uncategorized|November 18th, 2007

When planning for a steel building project consider the differences between a broker and a contract manufacturer.

The use of a pre-engineered steel building “no service” broker provides the lowest price on base building materials. Brokers are usually only concerned with matching the size requirements to the lowest cost (and usually the cheapest quality) building material packages available. They will run ads in magazines or local papers or on the Internet with the hopes of attracting buyers to their low prices. Low prices, however, sometimes come with a significant cost. In order to maximize profits brokers must obtain the least expensive materials available to fill the order. They will not supply much, if any, assistance to the buyer. Their assistance may be just a pile of materials delivered to your job site and an assembly manual. Some brokers even charge on the back end of the project for certified blueprints and anchor bolt patterns. In some cases the buildings are not precision engineered and may take a lot of additional time to assemble. Brokers usually operate out of a phone room. They may or may not no much about the product they are selling. Their job is just to sell.

Components such as doors and windows are necessary to complete a building. Brokers can include them in your building package. The quality may be questionable. You may get commercial grade quality or a cheaper substitute. When steel prices skyrocketed in 2004, the American Institute of Steel Construction approved the use of price escalation clauses in building contracts. This was necessary if the order was not ready for fabrication promptly. The seller could levy a balance due for the increase in steel price from when the building was ordered until it was released for fabrication. Many companies use these clauses. Always ask to be sure the price is “locked-in” for the amount of time needed to obtain approved drawings.

The use of an assisting contract manufacturer is another option. Unlike brokers, a contract manufacturer has their product specifications on file with different fabricators. These specifications are pre-determined and constructed at the most cost efficient and proximate locations. Contract manufacturers sell precision engineered products. Normally these buildings are bolt together and require no welding. A contract manufacturer allows the customer the design and rigging to be added to their base building. They do not pre-assign or determine the additional accessories for the building but usually offer these options at direct pricing. There is usually a person of contact to help with the proper building codes, helping with the site plans examiner, recommending erectors, and acquiring architectural renderings, if necessary, to help with code approvals.

Contract manufacturers are high touch and high service. The customer is in control of their project. The customer controls costs, sizes. Options they add and the erector they want. There are no hidden costs to the project. The customer can build a solid new steel building in the most cost-effective manner possible by using a contact manufacturer.

 
 
 
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