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Competitive bidding is the lifeblood of the construction industry. As such, the art of preparing winning bids is the Holy Grail of construction success, and yet, many skilled estimators effectively sabotage their own efforts when they fail to consult subcontractors during pre-bid.
Many skip this crucial part believing it to be a waste of time, while others prefer to keep their bidding objectives a secret. Either way, cutting subcontractors out of the loop is a shortsighted approach that can limit your perspective and result in bids that are needlessly high. Even worse, it can result in awards that cannot possibly be completed for the prices quoted.
Conversely, allying yourself with strong subs early in the process can dramatically increase your chances of hitting the elusive “sweet spot” – a truly informed number that leads to the kind of lucrative construction projects you ultimately seek. Before formulating your next bid, consider these advantages of partnering with subcontractors right from the start.
You regularly subcontract work on awarded projects to better use your limited resources. This same rationale can be applied to bid preparation. By simply shifting the burden of takeoffs and detailed estimating onto interested subs, you effectively increase your workforce without spending a dime. This, in turn, can free your in-house staff to more closely scrutinize work you’ll self perform, and perhaps leave time to bid even more work, thus bringing even greater opportunities for success.
Bottom Line: Enlist subs early to make the most of your estimating team and to defray the costs of preparing bids.
In common practice, well-meaning estimators apply unit pricing to combined quantities and dimensions to reach their bid prices. Unfortunately, common practices lead to common bids. By contrast, winning bids exploit hidden opportunities to create superior value.
Good subs keep abreast of advances in materials and processes that relate specifically to their fields. They know how to engineer production plans that can sharply reduce or eliminate expensive machinery and additional manpower. All of this intimate, trade-specific knowledge enables subs to aggressively seek out increased savings and improved efficiencies that others may not know how to achieve.
Bottom Line: The same expertise you expect from your subs on the jobsite can be a major asset prior to bid. Request aggressive pricing from those prepared to provide it.
Broadly stated line items can conceal hidden pitfalls that may jeopardize a project’s success. A sub uniquely experienced in his craft can often read between the lines to see costly complications that go well beyond takeoff and scope-of-work. An expert’s review of bid documents can alert you to such concerns as:
- Advanced safety requirements
- Labor and jurisdictional considerations
- Availability and placement of utilities and needed resources
- Environmental requirements and impact controls
- Available shifts, strict scheduling timelines and critical path objectives
- Coordination with allied trades and other contractors
Bottom Line: Good subs have the experience to spot the landmines associated with their trade. Rely on them to safely guide you to a well-informed bid amount.
You’re not just looking for winning bids; you’re looking for successful projects, and successful projects require teamwork. Winning teams are forged over time and through a series of ongoing, shared commitments. Form your strategic partnerships early to reap these bidding rewards:
- When giving quotes to competing bidders, subs will typically give better numbers to contractors they trust and share positive histories with.
- Having buy-in at the earliest level makes a sub more willing and capable to take complete responsibility for their scope once the job begins.
- Consistent expectations between all parties minimizes confusion and helps avoid costly delays at every step of the project lifecycle.
In the final analysis, do you really want a one-off contractor with no real investment in your long-term success? In the words of Dwight Eisenhower, “better to have one person working with you than three working for you.”
Bottom Line: Mutually beneficial relationships built on trust and openness are the foundation of winning bids. Build these ties right from the outset to create a pattern for ongoing project success.
Given the importance of competitive bidding to your success, you owe it to yourself to tender smart, aggressive bids. Better achieve this goal by engaging subcontractors right from the start of the bidding process. Their input maximizes your efforts and ensures you submit the shrewdest, most well-informed numbers possible. More importantly, forming strategic alliances with strong subs who share your commitment to bidding success is one of the best ways to ensure your overall success once projects have been awarded.
Contact CTI today to learn more. |
