“Business got to the point where customers would ask, ‘Can you also do this?’ and we’d say ‘Yes’,” Mary Miller says. “Then we’d have to go find a quality contractor to sub the job to.”
Over the years the Millers began to know and value the relationships they had with other contractors, and they realized they could help both property managers and contractors by acting as a consultant of sorts.
So under the Pavement Exchange Group they visit any property being considered for work, then determine the scope of work for each job. Then the Pavement Exchange brings the job to any of a number of contractors, who can bid it or not as they see fit. The Pavement Exchange evaluates the bids, submits them to the client, who selects the contractor. Miller says the Pavement Exchange is involved from originating the scope of work, to qualifying a contractor, to inspection of the final job.
“We bring them the job to bid, they bid it, we evaluate the bids to make sure the customer can compare apples-to-apples, and then the customer makes his choice,” Henry says. “After that Pavement Exchange continues to act as a facilitator between the customer and the contractor.”
Miller says that since starting in 2003, Pavement Exchange Group has facilitated work in 42 states.
Rose Paving’s Rose Alliance
The Rose Alliance was created gradually, initially because there were times when Rose Paving, Bridgeview, IL, couldn’t perform all the work it had contracted.
“We were either too busy, or we didn’t have enough iron,” says Alan Rose, who believes a contractor shouldn’t have equipment in the yard if he can’t keep it busy five days out of the week. “So we began compiling a database of contractors who we knew we could rely on to help us out and do a good job doing it if we ever got in those situations.”
Rose Paving still does most of the work it bids with its own crews, often sending crews to other areas of the country to service the needs of a national client. In the last year Rose has sent its own crews to more than 15 states to perform work.
“There are areas we know we’re not going to get to and we want to be able to have somebody represent Rose Paving in those areas the way we want to be represented and who follows Rose Paving’s ‘best practices’,” Rose says. “They do the work for us, and we get what amounts to a commission or project management fee.”
Guy Gruenberg, Rose Paving chief operating officer, says among the benefits to Alliance members are:
Insurance. Some national accounts demand a $5 or $10 million insurance policy before they’ll allow a contractor to bid and certainly before they award the job. “That’s something a smaller contractor would have difficulty affording and we can provide that for them, so they can do work they otherwise would have been unable to do,” Gruenberg says.
Quick payment. In most instances Rose Paving pays Alliance members within 30 days of receiving the job invoice. “That takes a lot of pressure off because they don’t have to wait for a check to come in. It helps their cash flow,” Gruenberg says. “And because they know they’re going to get paid right away they don’t have to build in any charge for late or long-term payment, making Rose and its Alliance members more competitive in the bid.”
Handling of complex contracts. Many national companies have their own contract, drawn up by their attorneys, that they want the contractor to use. Gruenberg says Rose Paving evaluates and interprets the contract for Alliance members.
Rose says the goal is to have one or two Alliance members in every major U.S. market they can go to and get a fair price on a job.
“It takes the legwork out of the process for them and us. They don’t have to work to get a chance to bid the job because we’ve done that already and they just have to bid it,” Rose says. “We don’t have to go looking for someone to do it, and we don’t have to send a crew half way across the country, because we have an Alliance member there ready to do the work the way we want the work done. And our client is happy because he gets the same top-quality job at each of his locations and he only had to deal with one organization, Rose Paving.”