The key distinction between design-build and design-bid-build is that in design-build, the design and construction components are packaged into a single contract.

The term “design-build” refers to a range of alternatives to the traditional project delivery system. A useful way to look at design-build is by what it is not. Traditional design-bid-build is a segmented, sequential process in which the owner first contracts with a design professional to prepare detailed, suitable-for-construction plans and specifications, then uses the detailed plans and specifications to solicit competitive bids for construction, and finally awards the construction contract to the low bidder.

On the other hand, design-build contracts usually – but not always – are awarded on the basis of price and other factors (often referred to as “best value”), where the designer-builder offering the lowest price is not necessarily the winner.
 

POTENTIAL ADVANTAGES OF DESIGN - BUILD

Earlier Cost Visibility - The total cost of the project is apparent earlier with design-build. In traditional design-bid-build, construction costs are not known until bid opening. With design-build, the contractor agrees to a price before the owner spends money on design or construction.


Cost Savings - Design-build has the potential to reduce overall project cost because the design-build contractor performing the design has a better feel for the construction cost of alternatives and thus can come up with a design that is less expensive to build – and has an incentive to do so.


Earlier Completion - Design-build may result in earlier completion and occupancy of the project because there is no dead time between completion of design and start of construction. Further, the design-build contractor can begin construction of early phases of the project (such as grading, site utilities, foundations) before design of later phases (building envelope, interior partitions, HVAC, electrical) is 100 percent complete.

Over-All Optimization - With design-build,  the designer-builder has an incentive to use the optimum amount of engineering. As long as an additional dollar of engineering will save more than one dollar’s worth of steel, the design-build contractor will spend the engineering time up to the point of diminishing returns when an additional dollar’s worth of engineering saves only a dollar’s worth of steel – because both the cost of design and the cost of steel come out of the same pocket.

Reduced Administrative Burden - Design-build may reduce the administrative burden on the owner because there is one solicitation, one award and one contract to administer.