HOA vendorAs an HOA board member are you dreading the thought of going through the process of hiring a vendor for your HOA? It’s not an easy job finding the best fit for your community.

A good vendor understands your HOA's vision, provides quality of service, and executes good work, on time and on budget. A little homework and research upfront will save you loads of time, effort, money and headache in the long run.

We’ve put together some helpful steps you can follow to streamline the process, simplify tendering and connect with the contractor most suited to your association. Navigating the maze of finding the right vendor for your HOA isn’t easy, but with these steps, and your property manager’s help, you’ll get the job done. 

Price is just a small part of the equation

Informed decision-making involves more than just costs. Financial stewardship is important, however, the vendor you hire must also have the same values you do for your association.

Ask yourself whether they’re just there to get the job done and move on to the next, or do they care about the quality of their work? Do they pay attention to detail? What kind of value do you want your vendor to bring to your community?

Finding a vendor that’s right for your HOA means finding a combination of knowledge, experience, service excellence, responsiveness and cost. Keeping more than the least expensive option in mind when hiring a vendor is more cost-effective than the lowest bidder.

At FirstService Residential, we do the research to ensure we choose vendors with prior experience, an established track record and one that will best meet the association's needs. We have preferred vendors that can do any job, or an association can choose their own. 

Standardize your procedure

Part of your bid package in the tendering process should include a scope of work and a template that’s the same for everyone bidding on the job. Your scope of work should focus on specifications for each phase of the project. That would include required materials, tools and equipment, expected completion of the project and/or phases of the work, project costs, expectations for each party and a clean-up schedule.

vendor procurement process

As well, you’ll want to be clear about what the process is if the scope of work changes, or an emergency arises. And finally, all bids should include references, proposed warranties and guarantees. 
We manage the process of standardization by setting clear and reasonable expectations about how and when the job is to be completed, vendor insurance requirements, and any important considerations on how work is to be performed. 

It pays to perform your due diligence

Reputation is critical. But how do you know a vendor has a good track record? The best way is to speak to people that have hired that vendor. Or chat with other communities similar to yours and see if they’ve heard of the vendor(s) you’re considering.

Building extra time into your vendor selection process for this step is really important. Speak to the vendor’s references, former clients, and conduct a quick online search as well. People are usually willing to provide a review on the vendor you’re thinking of, and you’ll get the unvarnished truth.

Get your docs in a row

Part of your process requires gathering certain documents from each vendor. Your property manager can help you draw up a list that you can include in the tender package. And don’t forget consistency. Each vendor needs to receive and provide the same documentation.
You’ll want:

  • the vendor’s qualifications

  • past experience

  • past projects

  • any subcontractors

  • all applicable certifications/licenses

  • proof of insurance (type, coverage, and expiry date) 

If your HOA does not hire a licensed and insured vendor, it risks substantial financial penalties if injury or property damage results from their actions. Your association could also be responsible for paying out unpaid wages or worker's compensation claims filed by the vendor's employees.

HOA vendor contract

FirstService Residential ConnectTM , our proprietary software for property management is designed to allow a customized view that helps with your vendor management. Within this view you can perform such tasks as making payments, initiating work orders, tracking violations, accessing financial information and more. We work with our clients to ensure all the documents are uploaded to Connect to enable efficient document management. 

Things to remember when choosing a vendor for your HOA:

1. If it's too good to be true, it is.

Low prices and a willingness to end final negotiations quickly are a red flag as it could mean that contractor might be desperate and needing money.

2. Watch the frontload.

If an initial payment is requested that seems disproportionate with the first phase of work could be your contractor is cash-strapped.

3. Clean-up is part of the work.

Be sure you've specified where contractors and their sub-contractors can store their materials and tools. You should mandate how the work site should be maintained to keep an orderly appearance. Ask them to provide a map or description of the work area so debris and tools don't spill over to other parts of your community.

4. Get a warranty or guarantee.

Warranties and/or guarantees should be in writing.

5. Get everything in writing.

There may be times additional services are needed after the contract is complete. Don’t assume things are "understood." Make no mistakes; there is no such thing as a ‘legal understanding. It must be in writing to be enforced.

6. Consider hiring a consultant when in doubt.

It might be worth it to pay a consultant to write a project specification, and oversee proper installation and completion on complicated or large projects.

Trusting a vendor to perform work in your association always involves risk. You can minimize those risks and reduce or eliminate any unknown. After all, if things go south, your association's legal and financial risks can be substantial.

Lean on your community association manager for support

A board must understand their responsibility to properly manage its vendors to provide continued services to the association. However, as a board you don't have to go through this process alone, your HOA management company is there to assist you with not only hiring HOA vendors but managing them throughout the course of their contract. Connect with us today to know more about making the right vendor decisions.

Friday May 21, 2021