Construction Cannot Reform While Lowest Price Still Wins

Construction cannot improve quality, productivity, and building safety while commercial models continue to reward the lowest price, push risk down the supply chain, and encourage short-term decision-making. In this episode of Behind the Built Environment, David Frise, Chief Executive of BESA, speaks with Paul Beeston, Partner and Head of Industry and Service Insight at RLB, who has more than 25 years of experience across the built environment and has recently joined the Construction Leadership Council board to lead work on reforming construction’s business models. Paul argues that construction’s commercial model is not fundamentally broken, but that decades-old procurement practices are increasingly struggling in a market where clients expect more from their supply chains. At the same time, businesses face greater volatility, risk and pressure. The conversation explores how better governance, smarter procurement, and fairer risk allocation could build stronger businesses and deliver better project outcomes. This episode covers: Why good governance starts with strong client leadership, clear decision-making and transparency Why lowest-price procurement can undermine quality and create the wrong behaviours from the outset How risk is pushed down the supply chain and what sensible risk allocation should look like The case for earlier and more open engagement with contractors and specialist subcontractors Why retentions should be abolished and the potential unintended consequences of replacing them with bonds How the Building Safety Act is changing attitudes towards quality, competence and accountability Why right-first-time delivery can provide clients with better protection than relying on contractual or financial security The challenge of measuring construction productivity without losing sight of quality, social value and workforce outcomes Why whole-life value and building performance need to carry more weight in procurement decisions How data, AI, partnering and new commercial models could reshape construction over the next five years Paul also challenges one of construction’s most persistent habits: treating price as the easiest definition of value. With RLB research showing that 40% of procurement activity is still selected purely on price, meaningful reform will require clients and the wider industry to look beyond capital cost and understand the long-term outcomes they are actually buying. Ultimately, the episode asks whether construction can create a commercial environment where every part of the supply chain understands the value it contributes and how that contribution connects to better outcomes for clients, businesses and society.