Here are some common errors found when bidding construction projects. There are other items that you must also consider like: overhead percentage, mobilization, warranties, experience, fill-in every line on the bid form, contingencies and allowances. Remember the key to a successful bid is a mix of experience, performance and remember to follow the instruction to bidders.
1. Arithmetic
Common errors on calculation and using the wrong scale will lead you to the most common error when placing a bid.
Recommendation: Use
bidding software or an electronic calculator with a recording tape. Remember always to double-check quantities and pricing.
2. Improperly Pricing
Verify the quantities and supplies needed; check if the bid requires a lump sum or a unit price. Recommendation: Pay special attention when reading the instruction to bidders.3. Incorrect Allowances
Allowing too much or too little amount to perform a job might send a signal to the owner or the manager that something on your bid is wrong.
Recommendation: Prepare a detailed proposal for the allowance and prepare a complete
take-off for this job. Present the number as requested in the proposal, fixed price, unit price, lump sum, or per instructed.
4. Incorrect Units
Check the schedule of values to verify if they are requiring the bid on a lineal feet, yards or meter unit. Recommendation: Double Check and prepare a separate list with the requested units5. Labor Rates
Labor rates vary widely from jurisdiction to jurisdiction. Some projects require you to comply with
Davis-Bacon Act, local
union salary rates, among others.
Recommendations: Consult local business, laws and other reliable resources to get the correct rates and how to incorporate them to your bid. Special attention must be given to overtime rates.
6. Unfamiliarity With Project Site
Huge mistake! Some contractors present bid by merely completing a take-off from construction drawings.
Recommendation: Complete a
Due Diligence assessment and verify that field conditions are represented on construction drawings.
7. Underestimating Transportation Costs
That huge piece of steel or that unique material must be transported by train, plane, of overnight. Request a quotation for the delivery of the material and
plan its delivery. Broker costs or special taxes might add up to unexpected quantities.
Recommendation: Prepare a logistic plan of when and how the material will be transported. Remember to provide specific or realistic date and stick to that quotation as long as you can.
8. Regulations
Every jurisdiction has a local or
state code that must be followed. Sometimes these codes request for special equipment or additional pieces that were not part of the initial bid.
Recommendation: Hire or consult a local expert that will help you on the assessment of the construction codes
9. Quality
Sometimes contractors tend to work in certain ways, but specific regulations might require to bring
specialized contractors, even licensed contractors, to perform a job.
When bidding be sure that every requirement is being met, and that the proposed workmanship is appropriate.
Recommendation: Look for high specialized items under the contract and request a quotation from specialized contractors, this will guarantee that you will be in compliance with all requested labor quality.
10. Minor Items
Minor items tend to present
major costs. Sometimes a bid proposal will not require presenting a bid number for waste disposal, or even
scaffolding; but be aware that adding these little costs can lead to a significant portion of your bid total.
Recommendation: Analyze and list all necessary equipment to perform a job, no matter how small that equipment can be or how short its usage will be.
