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Budgeting

How to compare HOA vendor proposals beyond the bottom-line price

VendoRFP TeamJuly 16, 20267 min read

Put both proposals on the same period first, and make that period annual every time. Then line the work up task by task, because until the periods match and the task lists match you are not comparing prices at all. Two proposals at the same number can describe very different jobs, very different risk, and a very different total by December. The price only means something once you know what it buys.

Normalize the pricing period first

Before anything else, get every proposal onto the same time unit. Vendors price monthly, per visit, quarterly, seasonally, and annually, and sometimes all of that appears in one document. Convert them to two numbers: an annual total and a per-visit figure.

The math is simple, and boards skip it constantly. Multiply a per-visit price by the visits per week and the weeks in your open season and you have the annual number; divide a monthly price by the visits in that month and you have the per-visit one. Two proposals, one priced per visit and one per week, can rank in either order depending on the frequency each of them assumed — and the frequency is usually the thing they quietly disagree about.

Line up the scope, task by task

Now put the scope of work from each proposal next to each other and check what's included. This is where the real differences live:

  • Does the landscaping proposal include fertilization, or is that extra?
  • Does the pool proposal cover chemicals, or do you buy those separately?
  • Are filter backwashes, irrigation checks, or seasonal cleanups in the base price or billed on top?

A proposal that looks cheaper per month is very often the one that leaves out two tasks the pricier one includes. Build a simple grid. Tasks down the side, companies across the top, a check or an X in each cell. Draw the task rows from the most detailed proposal, so anything only one company mentions still gets a line. The gaps become obvious fast.

Find the "billed separately" items

Every proposal has a base price and, usually, a list of things that fall outside it. Read that list carefully. It is where surprise costs come from. Look for:

  • Trip charges or minimums for repair calls
  • Parts and materials markups
  • After-hours or emergency rates
  • Startup, mobilization, or "first clean" fees

Ask each company for its hourly rate and its materials markup in writing, even if you do not expect repairs. Then ask what it would expect to bill separately in a normal year in a community like yours. Over a year, a low base price with an aggressive parts markup can land above a higher base with fair pass-through pricing, and the only way to see it is to have both numbers before you sign.

Read the contract terms, not just the number

The dollar figure is one variable. The terms decide how exposed you are:

  • Length: Is this a one-year agreement or a three-year commitment?
  • Renewal: Does it auto-renew, and what notice do you need to give to stop it?
  • Price escalation: Can they raise the price mid-term, and by how much?
  • Cancellation: Can you leave for poor performance, and with how much notice?

A cheaper proposal locked into three years with an auto-renewal and a 90-day cancellation window can be far riskier than a modestly higher proposal you can exit in 30 days. Price and terms have to be read together.

Weigh the things that don't show up as a number

Some of the most important differences never appear on the proposal. From the proposal process, you already have signals: Did they respond quickly? Did they walk the property carefully? Were their references from communities like yours? A company that communicates well and documents its visits saves the board hours of chasing and disputes. A spreadsheet will not capture that, and you will feel it every month.

Calculate a realistic annual cost

Pull it together into one honest number per company. Start with the annualized base price, add the "billed separately" items you can reasonably expect in a year (a couple of repair calls, seasonal work, materials), and factor in any escalation. Now you're comparing total expected annual cost, which is the number that hits your budget, instead of a headline price that flatters whoever left the most out.

Watch for the outlier in both directions

A proposal far below the others usually means missing scope, or a plan to recover margin through extras. It is a prompt to ask what is not included, not a bargain. A proposal far above the others is not automatically padding, and it deserves the same question. What does this one include that the others do not? Either way, the outlier is a signal to dig, not to decide.

Where VendoRFP fits

Comparing proposals is easy once they arrive in the same format, and hard every other time. On VendoRFP local vendors propose on the work you post, in one consistent format with pricing and terms side by side. Your board reads them that way and picks one; the contract is between your community and the vendor it picked. Three documents decide it: general liability, workers' compensation, and the credential that vendor's trade requires. A person here verifies each certificate against the limits your community set, so "is this company even safe to hire" is settled before price enters the picture. Each company sends its own invoice, and they arrive in one view alongside the visit records.

The billing follows the proposal your board picked. Each service is billed at the price that vendor proposed, with sales tax and payment processing as their own line items, plus $25 a month per community. Your first community is free.

However you hire, the lesson holds. The price on the front page is the least reliable number in the proposal, so normalize it, unpack it, and compare the totals instead.

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