6 Signs To Watch For In Vendor Selection
The Board of Trustees of a homeowner’s associations (HOAs) is ultimately tasked with making sure the association’s needs, community buildings, and common areas are properly maintained. Oftentimes, associations must hire vendors to perform projects and tasks that require specific knowledge or skills. Vendor selection is not always an easy task and could require some planning and research to get it right.
Tips for Vendor Selection in an HOA
If your board is looking to hire outside parties for HOA projects, here are six tips to make sure quality vendors are selected.
- Review governing documents.
An HOA’s governing documents may outline restrictions on what qualifies a vendor as acceptable. These qualifiers include years of experience, being licensed, the amount of insurance they’ll need to acquire, and/or how long a contract can be written for.
- Request three bids on all projects.
Proper due diligence means requesting multiple bids on a project, so the board has enough information to compare adequately. Three bids also prevent the board from choosing a “friend” of another board member or community member without reviewing all possible options.
- Request copies of legal documents.
Part of the bidding process requires you to request proof of licensure in your state, a certificate of insurance, and any additional certifications the vendor has. Review each document to assure they meet any guidelines outlined in the governing documents. Once a vendor is selected, the board should request that the vendor be added onto their insurance as an additional insured.
- Review proposals for value not cost.
Choosing a vendor based solely on cost is not wise. Review all proposals line by line to determine who is offering more value for their fee and how these additional value-added services will help the HOA community in the long-run.
- Consider their overall demeanor.
First impressions say a lot about potential vendors, and so does how they communicate their services to you. Did they show up to the initial meeting looking professional? Was their vehicle exterior clean? Did they try to force or pressure you into deciding on the spot? Vendors that don’t care about their appearance may not put much attention into the cleanliness of their work site.
- Put everything in writing.
Once you select a vendor, the work, responsibilities, and expectations for both parties should be outlined in a work agreement. Before signing the agreement, it should be reviewed by the HOA’s legal counsel to make sure it protects the association, including meeting any requirements listed in the governing documents.
If your HOA is ready to hire vendors and needs guidance, contact our office today! AR Management Company gladly offers property, financial, and administrative management services for your HOA.