Design-Build vs. General Contractor: What’s the Difference?

You want to remodel your home, but don’t know which professionals you can trust to actually get it done. For most remodeling projects, the two best-suited types of builders would be either a design-build firm or a general contractor – so what’s the difference?

Both design-build firms and general contractors are capable of producing high-quality construction that lasts.  The difference is the model that they use to get there, and how that model affects the customer experience.

As one of Portland’s many design-build firms, our team at Lamont Bros. has helped hundreds of happy Oregon homeowners bring their ideas to life in their homes. But even we recognize that sometimes, the design-build model isn’t the best choice for everyone. 

In this article, we will discuss the characteristics of a design-build firm and a general contractor, the differences between the two, and what type of remodeling projects might be better suited for each. 

The defining trait of a design-build firm is the integration of the designers and building staff onto one team.

What is a design-build firm?

In its simplest form, a design-build firm is a combination of both a design company and a construction company in which the designers and builders are fully integrated into a design-build team. This means that, throughout the course of a construction project, a homeowner works with one business entity from start to finish. 

When working with a design-build firm, the design team will first guide you through the process of planning out a project. This includes everything from general home layout all the way down to what type of light fixtures and paint color you want. The design team also helps estimate the budget, so you remain in control of the cost. 

Once you’re happy with the design and budget for your project, it moves to construction. During the construction phase, the build team uses the plans provided by the design team. If they encounter any problems or confusion, the design team is in-house and ready to clarify or help change the designs as necessary.

Though they may do some labor on your remodel, a general contractor typically subcontracts most of the work out to specialized pros.

What is a general contractor?

A general contractor is a construction manager or company that works directly for a client to coordinate the construction of a project. As the overseeing authority on a remodel, a general contractor will hire subcontractors to perform most of the work.

So, a concrete contractor might lay the foundation, a framer performs the structural work, and a drywaller installs the drywall. The general contractor will coordinate with every subcontractor throughout the process, making sure the work is completed correctly and in a timely manner. 

Depending on the size and scope of a project, a client typically provides the general contractor with design plans drafted by an external architect or designer. It’s the general contractor’s job to interpret the plans and build the design. If any changes become necessary, the general contractor is initially responsible for overseeing those, too.

So, what’s the difference?

Since general contractors and design-build firms have different ways of doing business, there are also a handful of differences in the client’s experience. In many ways, it’s a lot like the difference between Mac and Windows. While design-build firms offer a more intuitive and user-friendly process, general contractors offer more flexibility. 

Advantages of a Design-Build Firm

The most obvious difference between a design-build firm and a general contractor is the integration of the design team into the entire process. This single factor can have a tremendous impact on the overall experience of a remodel project. 

1. The budget is tied to the design throughout the process

When you work with a design-build firm, the design team has the ability to accurately estimate the cost of a remodel based on its design. If the initial design is too expensive for your budget, your designer can always scale back the scope. As a result, you as the homeowner stay in control of the cost of the project throughout the design process. 

This is typically not the case when working with an independent architect designer. They can guess what it would cost, but because they do not build remodels as part of their business, there is no way for them to know how much it would cost to build their design until a contractor provides a quote. 

We had a client go through this exact scenario before he came to us. This particular homeowner, who we’ll call “Mr. Mallet,” paid about $25,000 to an architect to design an addition for his father-in-law to live in. The architect and builder met together and told Mr. Mallet that it would cost $385,000 to build his design. However, when the design and engineering were done, and the builder was brought back in to give a final price the total cost of the project was $650,000. 

When Mr. Mallet came to Lamont Bros., we ended up designing an entirely new addition for him to the tune of $400,000. Unfortunately for Mr. Mallet, he ended up losing a year in the time it took him to pay for the first design before realizing it would be way over budget.

2. Your designer has skin in the game

When the same company that designs your remodel is the one responsible for building it, the designer has more incentive to do their job well. The designer is involved in the project from the beginning of the design phase until the build is complete. As a result, they should have a vested interest in creating a design that is easy for the construction team to interpret and build.

Several years ago, Lamont Bros. worked with an independent architect’s design plans to build an addition on a house. Unfortunately, the architect mismeasured the home by 6 inches. This mistake ended up costing over $30,000 in framing costs. 

Most design-build firms will include drawings and plans in the contract.

3. The scope of the project is clearly defined

When working with a design-build firm, the entire project is planned out in a set of detailed construction drawings and blueprints. Not only that, but the specific product selections, including appliances, light fixtures, and trim material, are also integrated into the contract. As a result, your project’s scope is fully defined. 

When you work with a general contractor, the design plans are not included as part of the contract. Instead, they’ll usually include a brief scope document, which outlines what is and is not included in the project. With documents like these, it can be easy to miss something shown on the drawings. The result is often more confusion and more change orders throughout the project. 

Disadvantages of a Design-Build Firm

While they may offer several benefits for projects that require design work, design-build firms aren’t for every project. In some cases, there are disadvantages of working with a design-build firm under the wrong conditions.

1. Not every Design-Build firm is actually good at both

Some companies that bill themselves as “Design-Build Firms” are really only good at designing or building. Some construction firms might tack on poor-quality design services while focusing most of their efforts in delivering good construction, or vice-versa. 

In cases like these, the most important thing to be aware of is the company’s history. You can read reviews on Google, Yelp, and other online sources to gauge whether or not the design and build departments are up to snuff. 

You’ll also want to watch out for poor company organization. Sometimes, a design-build firm under the wrong leadership can be just as disjointed as the independent architect – general contractor relationship. 

2. Not well-suited for jobs that require little design work

If you have a home remodel project that doesn’t actually require a design, then many of the strengths of a design-build firm would be lost on your remodel. Some simple projects, such as painting, re-siding, or replacing windows, simply do not need a designer to be successful. 

When changing structural elements, cabinetry, electrical, or plumbing, that’s when a designer’s value is put to the ultimate test. Additions often cannot function without a designer, because all of these factors may play into the design.

3. Lack of flexibility during the build

Once a project moves from design to construction, the scope is more or less locked in. Some homeowners prefer the opportunity to feel a project out as they go. It is not as easy to change the design of a build when working with a design-build firm. 

Is it possible? Certainly. It just takes much more work because of how detailed the scope and selections are at the start of the project. Altering the build means altering the design plans, which takes time for the designer and costs more for the homeowner. 

With a general contractor, the process of changing a remodel tends to be more flexible. Since the contractor has fewer design documents and a more flexible staffing system, there are fewer constraints when it comes to making changes. 

Advantages of a General Contractor

Sometimes, hiring a general contractor is the right choice for a home remodel. Below are a few reasons why you might choose to hire a general contractor rather than a design-build firm.

1. Great for projects that don’t require much design work

A good design will benefit most remodels, but not every remodel requires a professional designer. General contractors are better suited for projects that are relatively simple and limited in scope. That means no structural changes, no rearranging cabinetry, and no changes in room use designation. They are also a better option if you already have designs for a remodel, and simply want it built. 

2. You have the freedom to build your own team

If you’d rather pick and choose from independent pools of designers and builders, more power to you. People often choose to go the general contractor route when they would prefer to hand-select every member of their team.

There are several advantages to going this route. First, you don’t have to find a design-build firm that does both design and construction well. Instead, you can find separate companies that are independently good at both. 

Many high-end construction projects are done this way. A homeowner will hire a world-renowned designer to design their project and get a well-respected general contractor to oversee the construction portion. 

3. You would prefer to take on risk in order to gain flexibility

One of the most flexible contract arrangements in remodel construction is the cost-plus contract. With this type of agreement, the client agrees to pay a contractor for job-related expenses, plus a predetermined profit margin. These types of contracts are more commonly offered by general contractors than design-build firms. 

Cost-plus contracts naturally place more risk on the homeowner, since there is no upper limit to the total cost of the project. However, it does give the homeowner freedom to alter the remodel’s scope throughout the build. Since the contractor bills based on project expenses, it’s easier to calculate the cost of a change order, and therefore easier to change things midway through. 

Just be aware that cost-plus contracts tend to cause more legal disputes than any other type of construction contract. Communication is key in order to have a successful remodel under this type of agreement.

Disadvantages of a General Contractor

Sometimes, working with a general contractor isn’t the best decision for a remodel. In cases where they are not the best fit, some of the following challenges may arise. 

1. Not enough budgeting support at the start

A general contractor can bid for a job and tell you what it will cost. However, they can’t as easily adjust the scope of a project’s design to your budget. The result can sometimes be a frustrating cycle of hopping between the architect and the contractor to narrow the scope down to a reasonable budget.

In the above case of Mr. G, the general contractor he hired to build the designs be paid for was only able to give him a take-it-or-leave-it bid of $650,000. 

When working with a design-build firm, the design team can help adjust the project designs to bring the cost up or down. In these cases, the homeowner isn’t stuck with one set of designs, and has more control over the cost. 

2. There is no single entity responsible for your project

When you work with separate designers and general contractors, the responsibility for your project is split between several camps. Ultimately, that means you must be the one to bridge the gap between the independent parties on your remodel. 

This can sometimes be an uncomfortable position to find yourself in. Relationships between independent designers and contractors are sometimes rife with conflict and finger-pointing. Instead of a unified team working towards a common goal, you sometimes end up being the only person who actually cares about both the design and the construction.

The best way to avoid issues like these are to thoroughly vet your job candidates before hiring them onto your remodel. Consider their communication, ability to collaborate as part of a team, and the quality of previous work. A proven history of satisfied customers is a good predictor of what your experience will be.

Want to learn more about design-build firms?

When provided with the right project and tools for success, a good general contractor or design-build firm can mitigate the worst of their respective disadvantages. As the homeowner, it’s up to you to decide how you want your project to go. Do you prefer the budgeting and design process advantages of a design-build firm? Or, would you rather have the flexibility and freedom of a general contractor? 

Now that you know more about the differences between a design-build firm and a general contractor, take your research a step further. To read about when and when not to hire a design-build firm, check out this article, where we discuss in-depth what makes a firm like Lamont Bros. a good or bad fit for a remodel.

Think you’re ready to start designing? If you’ve decided the design-build model is the right option for you, click the link below to schedule a free video consultation with one of our design consultants. They’ll help you through the process of deciding how to remodel your current home into your dream home.