Working with EPC Contractors: A Q&A with Industry Insiders
Engineering, procurement, and construction (EPC) contracts are on the rise for large industrial construction projects, particularly within the power, manufacturing, and oil and gas sectors. In essence, an EPC firm provides all design and construction services under a single contract. This can yield efficiencies in the execution of the project compared to other delivery approaches, and is part of the reason that the EPC model is becoming more and more popular.
As a water treatment vendor, Samco Technologies has worked on a variety of projects—working under an EPC firm to deliver water treatment solutions as a component of a larger turnkey facility. To help learn about what makes for a successful capital project, Samco recently sat down with some folks at major EPC firms to talk about their experiences in executing large construction projects, and what they look for in successful vendor relationships:
Can you talk a little about what an EPC company does and what role you play?
Proposal Manager (PM): My company builds power plants for the end client, and we have to bid on each project. My part is that I’m bidding and getting pricing from vendors to support a possible project in the future.
Design Engineer (DE): In my position, I’m involved in both design and commercial discussions. My organization has a lot of internal tools to track work, which are really helpful because we need to see in pretty granular detail what needs to be done, and how long it took us to complete that work, so we get a good idea of where we’re at any given point.
What are the biggest challenges EPCs face on a daily basis?
PM: My biggest challenge is having time and budget to review the design requirements as much as we would like to. As an EPC consultant, it’s very client-driven what we do. So some clients don’t have any requirements, and we can give our vendors more flexibility to go with more of their standard design. But many of our clients are very specific in what they want, and we have to pass that down to our vendors for them to follow. In those cases, we have to rely on our vendors, like Samco, to do more for us.
DE: I guess one of the challenges that I face—because I’m living it out here right now—is there are so many moving parts on the construction site that it can be easy to lose physical items, or have incomplete installations or things like that. In the office, it’s having to coordinate on both sides, with my design and construction team, and with the water treatment vendor. It’s a lot of pieces to put together, and construction has a lot of input early on. But, I think, in the end that makes for a better project.
What is the one thing a partner could do for you that would make your job easier?
PM: I like when vendors provide detail in the quote that they give me back, with the information in it on what they’re proposing. Vendors don’t get paid to put quotes together, so it’s whatever time they have available to do it, because it’s an overhead charge for them. But I like to have the details on what is included in my price.
DE: It’s hard to be the same person that’s doing the design and commercial stuff. One of the things I liked that Samco has done is that, especially during the startup phase, they’ve pushed the commercial discussions. With these large projects, it’s normal to have things come up where we would need to back charge the vendor, or where they would need to back charge us. That kind of wears on the relationship if you’re trying to get work done, but also nickel and diming each other over the small stuff. But it’s been nice to have a partner who’s willing to not go back and forth on every single thing, every single time, because it makes the whole thing a lot more complicated.
As an EPC, what are the top 3 things you look for in a vendor or provider?
PM: Completeness of the bid package, following the specifications I put out there, and low price. I personally am looking for somebody who has followed the specification, but pointed out things that could be optimized, and has pointed out things that will not work. And then, of course, price is always a big deal. It’s up to my company to make sure up front that we’ve included everything that we think we should so that we don’t have changes later.
DE: Number one is price, because it’s the easiest thing to compare when we’re originally awarding a contract to a vendor. Number two is how well a vendor is able to work with our construction team– which I think Samco has done really well. Even just simple things, like holding some of our shipments until we were ready for them at the site, so we didn’t have to have a place to store them. We could basically just take them off the truck, which was really convenient. Lots of other vendors would have made us pay for storage. And then the third thing is responsiveness—a lot of things will change during the course of design, so having somebody who can respond quickly and get you what you need when you need it will help to facilitate a smooth project execution.
Can you give us some examples? What was the best part of working with Samco Technologies?
PM: I like working with Samco mainly because they’re responsive. I know they are going to read what I give them, and they’re going to customize their response based on my needs rather than just giving me a standard package. I think it’s this personal touch, because they’ll read what you have to say, and they’re not afraid to comment back on it if they have a better idea, or something that would work differently.
DE: For me, the technical expertise that Samco brought to the table was really helpful. I think sometimes on projects, you get cookie-cutter responses from water treatment vendors where they’re not necessarily putting a lot of thought behind that specific project; it’s more like an off-the-shelf option that they’re giving. And that definitely wasn’t our experience working with Samco. I really liked that there was the technical expertise to give us everything that we were asking for, and also that they helped us come to decisions on what we might want to add and things like that. It just felt like we were really able to work with Samco, as opposed just saying “well you just bought our xyz product off the shelf, and we’re not customizing it, and I can’t tell you why it was designed this way.”
Also, from what I’ve seen, Samco seems to do a lot better with quality control by having everything integrated under one roof. Even with stuff that wasn’t done under Samco’s roof, I was able to go up to Buffalo and see where they were getting their coatings done and it was just down the road. It might be cheaper to get something from a vendor who gets skids manufactured in another country or something like that, but unless the vendor was really on top of their quality control, a lot of times things would slip through the cracks until the last minute when it creates headaches. But with Samco, we were able to get a high degree of confidence that what was coming from Samco was what we needed off the bat. At a high level, I’ve really enjoyed working with Samco, and I would love to work with them again.
The bottom line
In taking on all phases of a project, an EPC can take work off an owner’s plate, though this often means managing a number of relationships, not just with their clients, but with each of the vendors they choose to work with on the project. The Proposal Manager and the Design Engineer we spoke to help to show how good communication, teamwork, and subject matter expertise all help to pave the way to a successful project, both at the front-end and throughout execution.
To find out more about any of the engineering, design, lab tests and pilot studies, fabrication, installation, and ongoing support services that Samco offers, please feel free to contact us. You can also visit our website to set up a call with an engineer, request a quote, or click on over to our blog to learn more about process purification and separation systems, wastewater treatment systems, industrial water conservation strategies, and more.
How can SAMCO help?
SAMCO has over 40 years’ experience custom-designing and manufacturing water treatment systems designed to conserve water and energy resources, so please feel free to reach out to us with your questions.
For more information or to get in touch, contact us here to set up a consultation with an engineer or request a quote. We can walk you through the steps for developing the proper solution and realistic cost for optimizing water use at your electrical generation facility.
Head on over to our blog to learn more about industrial filtration and process separation technology. Some articles that might be of specific interest to you include: