As a building professional, you
structure your daily lives around deadlines. The construction
industry abounds in steadfast
dates and times that must be
met—and of which are taken
very seriously by those watching
the clock. There are deadlines
for pre-qualification, invoicing
and payables, submittals and
shop drawings, and, of course,
for the completion of the project
itself.
These time lines alone are
enough to define and dominate
most any workday, but as
important as they are, they
become irrelevant if you don’t
the first place. So, let’s take a moment to
examine what I feel is the most important
deadline of them all: the bid deadline.
Hopefully, speaking from a general
contractor’s point of view (of which I
am), I can offer some insight into the
importance of being on time with your
bids and maybe even churn up some
newfound respect for this “Rodney
Dangerfield” of deadlines.
The Bid Process
As a subcontractor, much of your revenue-
generating work—your lifeblood—
likely comes from two sources:
1) direct selling to the construction endusers
(homeowners, businesses, etc.), or
2) through a contractor designated as
“prime” on a particular contract. This is
most often the general contractor, and
it’s the GC that will be the focus of this
piece. GCs, of course, are those (often)
larger construction organizations that
quote the entire building project (all
work disciplines)—from permit to
touch-up—directly to the project owner.
The process, particularly if commercial,
will almost always involve a design
team—architects and engineers—who
create the working drawings and specifications
for the owner to aid him in bidding
and building the project. The GC
then submits his proposal in strict accordance
with those documents.
But the GC can’t do it alone. He needs
help—from you. Depending on the
GC’s abilities for in-house work (that
work performed directly by his own
employees, such as carpentry or concrete
work), he will still most often need pricing
from subcontracting and building
material supply firms to complete his
proposals. Unless he’s negotiating with
one particular sub or supplier, he most
often gathers competitively bid quotes
from within a trade discipline and then
chooses one that best fits his needs. He
then takes the outside proposals that he
has selected, combines these with his
own in-house take-offs, add for cost of
bond, insurances, profit/overhead, general
conditions and other incidentals,
and eventually melds all the pieces into
a complete and (what he hopes is) a
competitive proposal to the owner.
But the GCs can’t just submit whenever
they feel like it. The majority of time,
they’re required to submit their bid proposal
by a ruthlessly rigid and (most
often) unalterable bid date and time. If
the proposal is late, the GC runs a very
real risk of being disqualified, rendering
all the hard work, office time and expense,
and personal angst and energy
wasted. Of course wasted time is unprofitable
time, so the GC is going to get his
bid in on time—and this means you, the
subcontractor, need to get your bid in on
time.
More Than Meets the Eye?
But what does “on time” really mean? In
our case, it most definitely doesn’t mean
getting your bid in five minutes before
bid time. There’s more to it. For
instance, to be truly in the running, you
may have to get your bid in hours—
even days—before the bid deadline.
So how early before bid time should you
submit your proposal? Many considerations
that go into the answer, but here
are some general rules. First, be aware
that the GC estimator may often have a
lot of work to do on the proposal itself.
These days, there are alternates, unit
prices, sub-contractor lists, preliminary
schedules and more to include with the
bid. Not including these items can subject
the GC to disqualification. Now,
unfortunately, in order to be competitive,
the estimator must wait until only
and hour or two before bid time to complete
this work. Therefore, I can tell you
(and I’ve been there!) that this is not
when I want to see your quote come
over the fax, especially if it’s incomplete
or vague about scope of work.
If the GC’s quote is due at 2 p.m. on bid
day, it is highly advisable to get your subcontractor
or supplier proposal into the
estimator’s hands well before noon. Earlier
is better. How early depends on the
size, complexity and importance (to the
overall proposal) of your particular
product and/or service. The idea is simply
to give the estimator-during what
is always a hectic and harried bid day—
adequate time to review and verify your
number and, more importantly, the
scope of work that you’re offering for
that number. He simply wants to intelligently
gain an “‘apples to apples” comparison
between your proposal and that
of your competitors. If your quote is
complex in scope with several alternates
and unit prices, it should be submitted
that much earlier.
Is It Getting Wet in Here?
Yes, an early submission may potentially
open you up to having your number
“leaked’ onto the streets, but (and please
listen to this!) it has been my observation
that this practice simply doesn’t
occur anywhere near as often as what a
lot of people in the industry may believe.
Maybe I’m just in an honest area—or
perhaps I’m naive—but in 23 years, I
just haven’t seen the evidence—occasional
instances maybe, but nothing
rampant. And I think there are lots of
reasons why it isn’t more prevalent and,
as much as we’d like to hope so, it’s not
just the ethics that drive the decision to
avoid this practice.
The first is that most GCs have reputations
to uphold, and they take them very
seriously. They don’t want to do blind
competitively bid projects (of which
they have little or no control and to
which most any contractor may be
invited) for the rest of their lives! They
want to negotiate more work; maybe
move more into design/build projects,
where they do enjoy better control over
the process. But what they’ve learned in
the time they’ve been here is that negotiated
projects only come along after the
company has proven to the public atlarge
that it’s trustworthy, dependable
and professional. Leaking sub/supplier
numbers to the streets is no way to
achieve this goal. People simply talk too
much.
But secondly, and perhaps more importantly,
there is the competitiveness factor.
Keeping your numbers hushed is
good business. We’re not idiots. We
know if word gets out that we’ve been
spreading numbers to your competitors,
eventually it will catch up with us. Our
subcontractor and supplier bids (our
bidding life-blood) will dry up. The logic
goes like this:
No sub/supplier bids = No competitiveness
= No work = No revenue = No GC!
Remember, we may employ some of our according to
own in-house trades, but we still need the architect’s
outside help—lots of it! We’re not look- plans and specing
to lose it. If you do think you were ifications?
leaked, confront the GC in a businesslike
manner (in other words, don’t Never assume
threaten to shoot his cat . . .), and often you may substiyou’ll
find that’ll never happen again. If tute your stock or
it does happen again, discontinue the
relationship.
Other Reasons to Be On Time
Another practice that is growing in popularity
is the advent of including subcontractor
lists with bid proposals. This
is where the GC must write in the
names of the subcontractors he used to
prepare his bid, and if the project is
indeed awarded to that GC, the listed
sub(s) will do the work.
Though I have seen these lists become
quite flexible after the fact, there’s a very
real chance that if you’re not included on
the list, you won’t—in any case—be
doing the work. The owner can demand
that the GC adhere to the list and allow
no deviation.
Why wouldn’t you be on the list if your
proposal was low? Because you got it in
too late for the GC estimator to thoroughly
analyze your scope of work, sort
out your alternates and unit prices, get
his questions answered (were you even
available?) and compare it to the overall
value (not just base price alone!) of your
competitors. He just couldn’t risk it.
Closing
Of course being on time, regardless of
when that time applies to you, is worthless
if the proposal you’re presenting is
incomplete and/or inaccurate. Do you
always bid the project plan and specifications?
Never assume you may substitute your stock or commodity product for those called out in the bid package and, if you do substitute, make sure you let the estimator know it. This won’t necessarily lose you the sale.
More than three-quarters of the projects
I quote are over budget. We’re constantly
value-engineering (seeking economic
alternatives) the projects we bid, and
often your alternates are just what we
need. You may get the nod weeks
after you thought you were out
of the running, simply because of
your substitution.
If you really want to impress us, bid
the project plan and spec (even if it
means outsourcing the specified product), and then include a voluntary alternate with your product(s). Then,
deliver what you promised, back up your work, stay with the scheulde… and move onto the next one.
About the Author
S.S. Saucerman is a full-time commercial
estimator/project manager for a general
contracting company that is based
in Illinois.
Closing
