Governance

June 22, 2026 Published by Toronto and Area Chapter - By Murray Johnson

Financial vs. Hiring Decisions

From the Spring 2026 issue of CCI Toronto Condovoice Magazine.

Over the years, condominium managers have inadvertently encouraged clients to select service providers based solely on obtaining multiple bids and choosing the lowest price. This approach warrants reconsideration, as experience has demonstrated that hiring amateurs can ultimately prove costlier than engaging reputable professionals.

For straightforward tasks such as painting a wall, establishing clear bidding specifications—prepping the wall, applying one coat of primer sealer, and two coats of semi-gloss to match the existing color—followed by awarding the contract to the lowest qualified bidder is appropriate, provided all vendors possess relevant expertise.

However, for roles requiring significant trust or specialized knowledge, such as auditors, engineers, legal counsel, cleaning and security personnel, and management firms, the selection process should be regarded as a hiring decision rather than purely financial.

These professionals interact directly with sensitive financial information, asset conditions, community well-being, and fiduciary responsibilities. Therefore, it is essential to assess candidates for alignment with the values and culture of the condominium community, their skillset, and their understanding of the board’s objectives, with compensation considerations addressed only after qualifications have been thoroughly evaluated.

Choosing a service provider involves much more than assessing costs. It is important to determine whether the individual fits within the community, understands its direction, and possesses the requisite skills and values.

Managers should carefully analyze unusual bid discrepancies, especially when encountering a significantly lower price, as this may indicate compromised quality or shortcuts in labor and materials.

Selecting the lowest bid without evaluating underlying factors can result in unsatisfactory outcomes and potential additional costs associated with correcting substandard work. An informed, comprehensive hiring approach leads to better long-term value and supports the health and integrity of the condominium community.

Often, the more expensive bid turns out to be the right financial decision, because the job is done once and done correctly, instead of having to redo the work multiple times for a lower cost service.

Don’t get me wrong, we always have to be responsible with other people’s money and being responsible means bringing the right service providers or vendors to the table from the start.

The now common third-party vetting services go a long way to ensure bidders have the proper insurance, credentials, certifications, occupational health and safety, and WSIB, but this does not screen for experience or for strong business ethics.

Instead of asking how much, think about asking what the risk is of selecting the lowest bidder. Consider if a financial decision or a hiring decision is appropriate for the service being considered. These questions apply to both managers and condominium directors, who ultimately approve service provider selections.

Instead of the first question being “How much does it cost?”, it should really be the last question to be asked.

Murray Johnson
OLCM, CCI (Hon’s), LCCI, FCCI
Senior Director,
Condominium Services
ARS Responds Canada