Large gap between competing construction bids

[David B.]

Hi everyone! Hopefully I'm dropping this post in the right forum. I'd be happy to repost if it needs to go elsewhere.

We have 2 bids from companies for a small extension + backyard ADU project here in the San Francisco Bay Area. 1 is from a smaller shop that a friend who is a seasoned real estate veteran referred me to and the other is a Houzz/Yelp find that is well reviewed on those sites.

Friend's shop came in at $390K and the Online shop came in at $532K. The issue is that the scope of work for friend's shop is less than the online shop's because it doesn't include re-roofing the rest of the main house. Also being a smaller shop they won't be able to start until later and I would assume they'll take longer to fully complete as they juggle other jobs.

The online shop is including the roof remove/replace job (about 2400 sq/ft plus materials) and even including solar panel removal/replacement in his price. The online shop is also more of a one stop shop as they say they have fast access to subcontractors should we need them whereas the friend's shop we may need to shop around causing delays.

So being a newbie to the remodeling world ... what would cause a bid to be so much less? Are they leaving the starting bid low to get in the door and then charge much higher change order prices? The roof will be the first change order and I'm sure there will be more as we start doing demo. 

The online shop has been great to work with so far. They did our design and approval process for us is going to credit the amount we paid off their original quote. Other credits include a $12k credit for finished materials of our choice and another $5k credit just because. That brought their original quote of $572k down to $530k which is still a substantial gap from the potential $427.5k ($390k+$30k roof+$7.5k solar panel) of the friend's shop.

Any thoughts or recommendations on which way I should go for the construction bid?