Who buys the lighting package — the GC or the owner?
By default, the electrical contractor buys the lighting package from a distributor, and the cost flows up through the GC to the owner — with margin added at every step. But nothing requires it to work that way: owners can buy the lighting package directly under an OFCI (owner-furnished, contractor-installed) structure, the same way they already buy elevators, switchgear, and kitchen equipment. Owner-direct purchase removes roughly 15% of pure markup and, in ODP states like Florida, adds sales-tax savings on top.
The default path — and what it costs
On a conventional project, the fixture schedule sits inside the electrical bid package. The EC prices it through a distributor, the distributor prices it through the manufacturer's rep agency, and each layer adds margin. The GC then carries the electrical contract with its own markup on top. By the time the lighting line lands in the owner's budget, it has been marked up three or four times.
The channel's economics make this expensive by design. Reps earn roughly 5% commission plus typically half of any overage above manufacturer net — a $1,000-net fixture quoted at $4,000 pays the rep $50 plus a $1,500 overage share. Distributor and contractor margins stack on top of that. Nobody in the rep-to-distributor-to-contractor chain is paid to make the owner's number smaller.
The owner-direct alternative
Under OFCI, the owner holds the purchase contract for fixtures and the EC keeps the installation scope. Owners already do this for long-lead, high-value equipment — lighting is simply the next scope where it pays. Cutting the GC and EC out of the material transaction removes their markup on equipment, commonly cited around 15% — before any negotiation on the fixtures themselves.
In states with owner-direct-purchase programs, tax-exempt or tax-advantaged owners can also capture sales-tax savings by taking title directly. On a seven-figure lighting package, the tax line alone can fund the procurement fee.
Why owners hesitate — and the actual answer
The standard objection is coordination: a commercial fixture schedule can span 30 or 40 manufacturers, each with its own submittals, release dates, freight, and lead-time risk. GCs will say — correctly — that owning that scope is real work. That work is exactly what a lighting procurement partner exists to do.
Brilliant Light Source runs the entire owner-direct package under one contract: net-plus-fee transparent pricing, submittals included, substitutions only with designer approval, and every release tracked from PO to job-site delivery. The owner gets direct-buy economics without absorbing the coordination burden — across $847M procured and 2,400+ projects, timelines have been cut by up to 40%.
How to decide on your project
The decision comes down to package size and timing. If the lighting package is large enough that 15% matters — most commercial projects — and buyout hasn't closed, owner-direct purchase is usually the single largest lighting saving available without touching the design. The first step is a benchmark: price the schedule at manufacturer net plus fee and compare it to the channel number in the GC's bid.
Follow-up questions
Does OFCI change who is responsible for installation?
No — the electrical contractor still installs, and typically carries a receiving-and-handling scope for owner-furnished fixtures. The only thing that changes hands is the purchase contract for the material itself.
Can the GC object to the owner buying lighting direct?
GCs can push back — they lose markup on the equipment — but owner-furnished scopes are standard practice and contract templates handle them cleanly. The key is deciding before buyout closes, so the electrical bid is scoped as install-only from the start.
What happens to warranty and returns when the owner buys direct?
Manufacturer warranties run to the purchaser either way. With a procurement partner managing the buy, warranty claims, freight damage, and returns are handled by the partner under the single contract — the owner isn't chasing 40 factories.
Is owner-direct purchase worth it on a small project?
It scales with the package. On small tenant-improvement scopes the coordination overhead can outweigh the markup saved; on packages in the hundreds of thousands or millions, the math favors owner-direct almost every time. A free benchmark tells you which side of the line your project is on.