Low Bidder Blues

For most construction projects,  we send out our drawings and specifications along with a bid form to 4 or 5 builders. The bid form is a chart that helps itemize in line by line format so we can understand the various trades like electrical, plumbing, tile, framing etc.

In an effort to remain competitive, many  bidders will submit bids that omit portions of the work or substitute materials that they feel are equal to what has been specified.  When omissions or substitutions in the bid have been provided,  it must to be called out as such in the bid or we cannot compare “apples to apples”.

Lowest Bidder or Highest Risk?finger-pointing

We get back the bids, analyze them and try to evaluate why the prices ended up at these prices. There are many factors + or – that go into the bids:

How hungry is the builder? +

How much competition is there? +

Are there material or labor shortages? –

Is the project located among other projects they are building? +

Can the builder leverage this project in order to get others? +

Did the builder misunderstand the drawings?  –

Are the subcontractors too busy? –

Are the substitutions or any deviations from the drawings and specifications?

You get the idea.

We frequently discuss the bids with the bidders and ask questions to more clearly understand the background in their development. Also we’ll review opportunities to negotiate and help our clients get a better price or value without jeopardizing quality or schedule.  It can be tricky – too much pressure and viola! you get the chef who spits in your soup because you squeezed too hard. images

A proper balance has to be achieved to incentivize/pay the builder to want to be at your project and fully commit without over-reaching too aggressively.

We’ve done it for hundreds of projects litle and huge. Let’s talk, we have a few solid strategies we love to share with you…ask for Steve 914 980 5532