At first glance, running a tender process for your residential building project might seem like the smart, responsible thing to do. You’re collecting multiple quotes, comparing costs, and choosing the best value, right?
Wrong.
The truth is, tenders are a deeply flawed process—one that rarely benefits the client, and almost always ends up damaging builders, quality outcomes, and the industry at large. Here’s why participating in a tender process could be the worst decision you make for your build.
1. It’s a race to the bottom
Tenders turn what should be a collaborative partnership between client and builder into a price war. Builders are forced to compete on the one variable they shouldn’t be judged on—cost. This leads to a “race to the bottom” where the cheapest quote wins, not the most realistic, experienced, or trustworthy builder.
In the end, you might win on price—only to lose on quality, communication, timelines, and budget blowouts later down the track.
2. Builders lose time and money-with no compensation
Every tender quote a builder submits takes days (if not weeks) of unpaid labour. They pour time into site visits, take-offs, estimating, subcontractor pricing, and material sourcing—without a single guarantee of winning the job.
It’s not uncommon for top-tier builders to walk away from tenders altogether because they simply can’t afford to do free work. The ones who do participate often cut corners in the quoting process, or underquote just to win the job—only to claw it back with variations and compromises once the contract is signed.
3. You attract the wrong kind of builder
The most sought-after builders aren’t sitting around waiting for tenders. They’re booked out, managing long-term projects, and working with clients who value their process and expertise.
Tenders tend to attract volume builders, under-resourced operators, or new entrants desperate for work—because that’s who can afford to throw out lowball quotes to win the job. And they often rely on variations, cost-cutting, or corner-cutting to make up the shortfall.
4. It justifies architects charging exorbitant fees
Many architects push tenders as a value-add to their service—“we’ll get you the cheapest build price.” This process makes them look good by presenting artificially low build costs… even if they’re not realistic.
It’s a clever justification for hefty architectural fees, but it ignores the downstream impact: poor builder fit, strained budgets, and conflict once construction starts.
5. There’s a better way
The best builds don’t start with a quote—they start with a conversation. A builder should be involved early, working collaboratively with your architect and client to value-engineer the design, flag risks, and deliver realistic pricing based on actual site conditions and current market rates.
This approach builds trust, transparency, and better outcomes for everyone involved. And yes—it usually ends up costing less in the long run, because you’re not wasting time or money fixing the mistakes of the tender process.
In summary
If you’re serious about a quality build, don’t waste your time with tenders. They’re not designed to deliver the best result—they’re designed to make things look cheap on paper. And the only people who benefit are the ones not around when your project runs off the rails.
Choose a builder based on trust, reputation, collaboration, and shared values—not the lowest price. You’ll thank yourself later.
Thinking about building or renovating? Let’s talk about how to make it a smooth, transparent, and enjoyable experience—without wasting time or money.
