Phone: 905-941-1611

10 STEPS FOR BETTER BIDS

  1. Bid the Right Projects – You don’t have to bid every job. Focus on the best projects that fit your company’s ability and expertise. Remember, it is never too late to abandon an estimate, especially once you realize the project is not the right one for the company.
  2. Visit the Site and Attend Pre-Bid Meeting – A site visit is vital if you are bidding a renovation project. Understanding existing site conditions and accessibility will provide you with the knowledge to properly address all risks in the estimate. The estimator should always review the drawings before the meeting. Review the contract drawings to identify the items that you will need to see during the site visit.

    3. Seek Clarification – Be sure that you have all pertinent information to properly bid a project.  If not, ask questions. A full review of the drawings and specifications is needed to ensure that you have all the necessary information for a competitive and accurate bid.

    4. Perform Accurate Takeoffs – The main function of the estimator is to quantify the work on drawings and in the specifications. Review both the plans and specifications carefully.  Determine the appropriate wiring methods for the project. Check all scales on all drawings. Verify any details related to the takeoff.

    5. Avoid Mathematical Errors – Estimating software prevents many mistakes that were once common in estimating. Performing math calculations in your head is unwise.  Use a calculator or your estimating software to prevent mathematical mistakes. Estimating software is preferred over using a spreadsheet program like Excel.  You can make mistakes in your formulas.

    Always double check calculations.  Have another estimator or the chief estimator review your numbers. Bid day can create an environment where mistakes and omissions are easy to make.

    6. Evaluate all Pricing, Quotations, Expenses, and Subcontractors – You need competitive quotations from your suppliers and subcontractors. You also need to have the assurance that your prospective subcontractors can perform on the project. Carefully review all bill of materials for accuracy. Read the fine print.  Check delivery dates, payment terms, etc.

    7. Identify and Manage Risks – Every project comes with its own unique set of risks. Identifying and managing risks should not be overlooked when preparing a bid. Identify, analyze, and evaluate each risk.  The final bid amount should reflect a price that will allow the contractor to properly manage and mitigate any risks.

    8. Labor Costs – Accurately estimating labor costs can be one of the most difficult aspects to preparing a bid. To determine labor costs, the estimator must accurately quantify all materials on the drawings and in the specifications. This complete listing of materials should give the estimator a total number of direct labor hours. The estimator must extend the takeoff with the appropriate labor column using his estimating software. Adjustments must be made to items in the takeoff according to the ease or difficulty of the installation. Labor factors must be applied to direct hours during the bid summarization to account for productivity effects.

    Be sure to use accurate wage rates for each labor classification in your area. Account for your labor force’s productivity. Non-local labor can affect a project’s pace.  Be sure the total hours have accounted for overtime, weather concerns, stacking of trades, and other labor factors.

    9. Materials and Equipment Costs – Be sure that you are pricing all materials with local current market pricing. Materials with large quantities should give you some buying power that will help reduce the unit price of an item.

    Send all specifications and drawings to suppliers for an accurate quotation. Solicit at least three quotations from your regular suppliers. If you are uncertain of the materials being requested in the specifications you should always get clarification from the architect, owner, or owner’s representative.

    Be sure that all owned equipment is in good working order. Don’t forget fuel costs and transportation costs of rental equipment for the jobsite.

    10. Incomplete Bid Forms and Documents – Failing to fully complete the bid form and submit all required documents is a sure-fire way to get a winning bid rejected. Carefully read the “Invitation to Bid” and the “Instructions to Bidders” and be sure to comply with all the requirements for a qualified bid. Double check that you have incorporated all issued addendums and have acknowledged the addendums in the bid form.

    Some owners and architects are now allowing bids to be submitted online. Be sure to check the requirements for a proper submission. If the bid is hand delivered, don’t be late.  Allow plenty of time for delivery, things happen – traffic jams, accidents, etc.

    Complete as many items the day before the bid due date. The preparation of a bid proposal is not hard, just tedious, and should be done meticulously. A successful low bid proposal requires time and attention to detail.

    Making mistakes can lead to overpriced, non-competitive bids or worse, a lot of underpriced bids with no profit.

    Remember, estimating is expensive, poor estimating is costly, but quality estimating is profitable.