How do I (re)negotiate prices with GC to exclude materials?

[Ilya Z.]

We're in the middle of our rehab project. The GC, who's doing some of the work with his crew and outsourcing the rest, gave us labor+material prices for individual parts of the project (roof, kitchen, baths, deck etc) but not the material costs separately. We're happy with what he's done so far and for the items he completed he didn't go over the numbers he'd given us.

Now I think I want to get some of the materials myself to reduce cost. For example, we just picked up a bunch of free tile a local shop threw away and it should be enough for the whole kitchen backsplash. However, when I asked him to provide me with material allowances for each item, he didn't and instead said that we're welcome to buy any materials we want but in this case he'll charge us $X per man per hour for labor. Since the goal is to reduce the cost, this response is not particularly helpful.

I realize that by giving us one dollar amount, he's trying to avoid asking us for more money for labor in case it takes him longer to complete something. So there's some padding there for him. Plus there is a project management fee there somewhere too, which is fine. So far, there were some delays in starting some of the work but once he started, he finished on schedule. Which is understandable since the fixed price forces him to work fast.

So how can I negotiate this with him? If he doesn't give me his material $s, I wont know if I am actually saving money when I am buying, let alone the potential runaway cost of labor if we pay him by the hour. This is a rehab with a relatively low profit margin so we're getting everything as basic as we can. Obviously free tile is as cheap as it can get but other stuff is easy to buy too expensive. So on option is to go back to the original arrangement on everything except for items for which I know I can get cheap materials (like the free tile). But then I still need to renegotiate the numbers on those with him. How should I do it? Thx

[Leroy K. Williams]

As a rehab manager myself I will say that your contractor is smart, he is trying to gently assert that its "HIS" project once you signed the agreement.  Providing different material can be a hassle as someone mentioned also it may change some element of the finish that the contractor is not comfortable with. Guys like to feel good about how their projects turn out.  If you want to provide material that should be negotiated upfront.