🔨 How to keep buildout costs down

You probably already know that the cost of building out a retail space is often the single largest line item in a pre-opening budget. The fact of the matter is that there’s not a whole lot to be done about this. If you need to modify a space to suit your business, you’re going to spend some serious cash — the more dramatic the changes, the more dramatically you’ll need to dig into your wallet.

If you’re do any sort of construction work, many of the costs will be beyond your (and even your contractors’) control. Every commercial contractor is working with the same framework: labor, materials, overhead, and profit. Remember, they’re running businesses, too.

So, even though there may not be a lot of flexibility on some of the pricing of the job, there are definitely things that you can do to keep your buildout costs as reasonable as possible. Here’s some low hanging fruit:

1. Control your champagne tastes, and be honest about your Bud Light budget. Be open with your designer and architect about your budget goals so that they can design accordingly. If you pretend like you’re Alicia Keys and Swizz Beatz (did you see their house in AD?!) when you’re taking about design goals with your architect, you’re going to be pretty disappointed when you’re $20M short on budget to pull it off. So be open and up-front about your true budget before you start designing. Think hard about which design elements are going to make an impact on your target market and prioritize those.

2. Get competing bids from General Contractors. Yes, we just said that there can be little flexibility in the costs of materials or labor hours required to do a job, BUT everyone uses different subcontractors to do different parts of the job. So if one GC uses a plumbing sub who has to drive in a team from 40 minutes away each day, and another GC uses a sub right around the corner, those hours spent traveling (which YOU will pay for) add up when a job takes three or four weeks. That’s just one example, but the point is that getting competing bids from GCs can save you many thousands of dollars. You never know where savings may be hiding.

That being said, the cheapest GC bid is not necessarily the least expensive when it’s all said and done. You have to be certain that the GC you choose is quoting your job accurately and has a solid reputation, because any misunderstandings or errors will add up and lead to change orders, and don't even get us started about shoddy workmanship.

3. Avoid change orders! Change orders are the officially documented changes or corrections to the plans that occur once the project is underway. Typically, change orders carry additional admin fees, so catching errors before you start is essential. How can you do this?

A) Review your plans! It’s well worth your time reviewing your construction set of plans with a fine-toothed comb. Counter heights, door locations, sizing of storage areas…it’s easy for details to slip through the cracks, so work hard to catch errors before the contractors see them.

B) Manage your project. Once the project starts, someone needs to run point. So either you or you AND a project manager need to be on top of every detail. You will be asked to approve details for things you don’t even think you care about like: EXIT signs, air vent registers, toilets, electrical outlet covers...exciting, right? Well trust us — it’s a terrible feeling to walk into your project and think, “WTF is THAT? The ceiling is black, so why are the air vents white?” Guess who approved it? You did. And now you want to make them black? Okay, no problem. That’ll be $400 to buy new ones and add on 10% for a change order fee.

So while you can’t always change the fact that the construction budget is going to be large, there is a lot that you can do — just by being detailed and communicative — to those costs in line and save your cash for opening day.