How To Bid A Construction Job To Turn A Profit

When it comes to construction, bidding jobs can be more challenging than doing the work itself.

According to a survey by SmartBid, 24 percent of general contractors said bid coverage was their biggest challenge with their bid management process.

How Does Construction Bidding Work?

Construction job bids are a vital first step, providing your customer with a detailed proposal of the job, including cost estimates and timeframe. If you’ve ever had trouble properly bidding a project, take a look at some of the tips for bidding construction jobs below.

Tips and Tricks for Bidding Construction Jobs

Review the Bid Package

What is a Bid Package?

The bid package is made up of drawings (architectural, structural, mechanical and electrical plans and details) and the project manual.

Reviewing the bid package carefully will help you submit a responsible, competitive bid.

"When we bid a job, we start by receiving and reviewing drawings. If we have questions or revisions for the architect, we send them over and they either answer or revise as necessary."

Sam Lehnecker I Assistant Project Manager, Engelke Construction Solutions, LLC

What to Expect in a Bid Package

• IFB (Invitation for Bid) letter: This explains what the project is and when the bid submission is due. The IFB letter will also clarify how the documents need to be submitted in order to meet bidding eligibility requirements.
• Procurement Lobbying Packet: These documents provide an explanation of State laws and must be filled out and signed to show proof that you understand and agree to abide by any applicable restrictions.  
• Detailed specifications of the contract: This includes general standards, contract terms and provisions and other important information about the bid and contract.

Visit the Job Site

Once you review the bid documents and have a good understanding of the project, compare the bid documents to the actual site.

If you’re at a new site, you’ll want to collect soil samples and send them off for testing. When accessing a site for a remodel, you should also look at the following items:

• Gas line size
• Waterline size
• On-site secure storage
• Potential staging areas
• Potential placement areas for construction dumpsters
• Temp toilets
• Storage containers
• Existing electrical panels
• Sprinkler height
• Existing fire alarm
• Color
• Wall thickness at masonry openings
• Interior and exterior concrete conditions
• Existing roof penetrations
• Size of existing man doors
• Existing demising wall

Make notes and submit any follow-up questions to the architect or owner of the project. This information will affect your construction job bid since it may impact whether you can make money at the price you quote.

Find Subcontractors 

When bidding on construction projects, general contractors gain more projects when they bring in experienced subcontractors to complete the work.

You can even meet with subcontractors on-site prior to bidding.

"We receive bids back from subcontractors and qualify them," Lehnecker said. "When we qualify them we are looking for complete scopes of work, outfit size and ability to man the job and complete their scope in their allotted time within our construction schedule."

As the general contractor, you want to find subcontractors you can trust to get the work done on time and within budget. Similarly, subcontractors are looking for general contractors that are easy to work with and pay on time.

Looking for good subcontractors? Consider the following:

• Ask around: Talk to friends, neighbors and construction industry people.
• Do your research: Look at past and current subcontractors and check their previous work.
• Ask for references and testimonials: Collect a list of names and follow them up. You should be able to tell right away if the relationship was good or not.

Present Your Bid

The last step in bidding a construction project is to submit your bid to the clients for review. But before you submit, you’ll need a construction bid template.

When you’ve found your subcontractors, enter their bid into the template to submit a construction job proposal you’ll give to the client to outline the scope of the project, timeline, materials and cost estimate for construction.

Without a construction bid template, there will be no way to gauge the overall cost of a project, which could lose you the job and damage the contractor-client relationship.

Now that you know how to bid a construction job successfully, you’ll be set up to start turning a profit. Have your own tricks for bidding construction jobs? Let us know in the comments! For more contractor resources and business advice, check out the Trades and Construction section of our blog.