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12 FEDA News & Views ment are found in contract documents, and it's also where the in-house counsel for Johnson-Lancaster and Associates lives. Heavy into contract sales throughout the United States and the Caribbean, the Clearwater, Fla.-based, distributor got its start catering to the government in 1980 but transitioned into contract bidding after pursuing a deluge of business fl owing from the theme park and education sectors in the 1990s. At times, that surge has amounted to as many as 100 projects a year, not to mention a number of complexities that eventually prompted Johnson-Lancaster to invest in an in-house counsel roughly seven years ago. "Realistically, it was about the numbers," says President Brad Lancaster, explaining the logic behind the move. "After taking a look at how often we were turning to our outside counsel to review contracts, it just made sense fi nancially. And strictly from a performance-based perspective, consulting an attorney has made us better on each and every contract. "That's one of those lessons learned year over year," he says. "We've just found it to be a necessity in this day and age of big contracts. Currently, our largest contract is over $20 million and it's essential that we are fully educated before going into and signing and executing a contract. I read each and every contract and our attorney reads them as well. Then, he gives us a summary to help us determine if and how we should price a project. If the risk outweighs the reward, we walk away." Take a job in Missouri, recently put out for bids. "They were expecting sole M.E.P (mechanical, electrical and plumbing connections) as well as duct work on the equipment," says Lancaster. "Perhaps, that's something that people in Missouri do, but we aren't capable of doing that. We're not plumbers, we're not electricians. We're foodservice equipment contrac- tors, so we simply elected not to bid on it." No. 2: There are Times When It's Best to Walk Away Lancaster will be the fi rst to admit, like most, he's scratched his head at a few questionable bids and wondered how a com- petitor was going to make the numbers work. Then again, he says, "A lot of people might be saying the same thing about us. You have to know your risks going in and you have to protect yourself the best you can. All we can do is educate ourselves, price accordingly and put in the hard work on the jobs that pay us at the end of the day." During the Great Recession, a stretch of hard luck in the Caribbean proved to be an exceptional teacher. "We were working there a lot, and had two projects that went bankrupt on us," says Lancaster. "Luckily, the majority of the equipment was still with us, so we were able to limit our losses. It was a great learning experience. Years of trial and error have taught us the importance of researching the owner to make sure they're properly funded. Oftentimes, we will turn down oppor- tunities because we are not comfortable with the fi nancing in place." No. 3: KECS and Consultants Have to Push Back In Drew O'Quinn's perfect world, the KEC community would have a standard template that it uses to convey expecta- tions to GCs, and essentially what kitchen equipment contrac- tors can and cannot do, or should and should not do on every job. No, scratch that. In O'Quinn's utopia, GCs and consultants would concede to a few givens—i.e., foodservice equipment dealers do not want to ever perform any M.E.P work, install the direct or indirect waste drains, or perform intercon- nections. These are the items that he religiously excludes from the scope of work. "Sometimes, contracts will state that whatever the electrician's or plumber's contracts don't pick up, we have to pick up the rest to make the equipment fully functional," he says. "We scratch through that, as we are not performing any connections or M.E.P work." In his mind, doing away with the gray starts with identify- ing what the consultant has designed and confi rming that the contract does not exceed those parameters. "Honestly, I don't know many dealers that are electricians," he says. "Yet, general contractors repeatedly try to get us to do electrical and plumb- ing on these jobs. That's the main issue we run into. Hopefully, the consultants' exclusions in the specifi cations and drawings will help us alleviate a lot of this work." He'll get no pushback from consultant Foster Frable, the founder and president of White Plains, N.Y., consulting fi rm Clevenger Frable LaVallee. "We never ask anyone bidding our projects to do the electrical or plumbing work (except con- densate drain on walk-in coils, or low voltage lines related to refrigeration controls and fi re suppression systems)," he says. "If a dealer does not have a licensed plumber or electrician on staff, they should not agree to provide any of the sidebar work, other than low voltage for refrigeration controls. If a consul- tant, project manager, or architect requests it, they should politely but fi rmly exclude it from the contract." As to why some consultants assign the work to KECs? It's complicated, Frable admits. "Sometimes, the consultant does put stuff in the spec that is, in some cases, not realistic because it was requested by the owner—and the consultant didn't have the experience or the knowledge to push back on it," he says. "It's not a one-sided situation, but we see this all the time in contracts that are sent to us. We get a contract that was writ- continued on page 22 5 Reasons continued The American Subcontractors Association offers a members-only knowledge database, webinars, a suggested agenda to subcontracts and numerous educational opportunities.