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How to Bid on Commercial Construction

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Bidding on commercial construction usually exposes an up-and-coming builder or skilled professional to higher profits but also more complicated jobs. Unlike project work for private parties on homes, commercial construction involves business-to-business work frequently awarded under very technical, competitive and legal processes. Many of these technical requirements are part of what is referred to as the bidding process.

Bid Preparation and Notice

Prepare a portfolio of prior projects and construction work already performed and a list of referrals from past clients to provide as recommendation contacts. Collect copies of all relevant business licenses, contractor licenses, tax information and business certification for skills. Place all of the information into a binder for easy retrieval and reference.

Anticipate the size of job that can be performed by your construction business. Plan what size jobs are possible versus those that are beyond your capability and potential resources. Map out the basic starting expenses and costs for each resource so you use them later as factors to build a detailed bid package once the scope is known. Contact potential financing sources such as your bank, creditors and credit-card company to confirm the level of credit you will likely have to work with.

Look for construction projects listed in your area or within your business reach in periodicals, union shop bulletin boards, trade hall notices, newspaper notices, industry websites on the Internet and government contracting bulletins. Screen the projects posted for those that you can reasonably perform based on the summary information provided.

Bidding on the Job

Read the bid project detail carefully. List out on a separate piece of paper all the criteria included in the detail that will be expected from a bidder. Identify and highlight the minimum bidding criteria necessary to even be considered a viable bidder by the bid reviewer entity.

Based on the detail information provided by the hiring agency, calculate your project cost in detail. Use the factors previously researched above to apply and total likely expenses for personnel, equipment, material, operating expenses, profit and any special costs that may occur. Total the figures into a bid estimate figure.

Double-check the bid requirements again for your bid package. Compare the criteria with each of your cost elements and look for any missing costs that were omitted from your calculations. Revise your estimate accordingly. Anticipate any tax impacts and include their impact in your estimate.

Prepare your bid proposal package as specified in the bid detail, making sure to use the format and forms specified. Do not deviate from the rules provided by the hiring agency. Make copies and attach copies of all documentation requested to support your qualifications.

Prepare a cost summary of how your bid quote is arrived at with your bottom-line dollar quote explained. Provide a narrative document and additional detail to explain how you will meet the project goals and qualification requirements.

Submit your bid package by the deadline and date required, paying special attention to submit before a specific hour in the day if required by the bid detail. Make sure to respond quickly and adequately if the hiring agency asks for any follow-up information. Try to deliver your package in person if possible. Call back within a day or two to ascertain the awarding notification process if not already detailed by the hiring agency.

Tip

Working closely with the contract or procurement staff of the hiring agency can provide you guidance and detail from casual conversation not always apparent in the written bid detail. Make sure to ask all questions you may have to clear up any ambiguities.

Warning

Do not fabricate or make up any details in your qualifications submitted in your bid package. Many times, particularly in government bid processes, competitors can obtain each other’s proposals after the award to review them for discrepancies. If found, a bid award could be appealed by a losing bidder upset at your job award.

About the Author

Since 2009 Tom Lutzenberger has written for various websites, covering topics ranging from finance to automotive history. Lutzenberger works in public finance and policy and consults on a variety of analytical services. His education includes a Bachelor of Arts in English and political science from Saint Mary's College and a Master of Business Administration in finance and marketing from California State University, Sacramento.

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