Need General Info On The Process A Company Goes Through To Bid On A Job

Treasurehoard

Hi. I need some general info about the process of bidding on a construction job. Any help is apperciated. Thanks. Please see questions below. I am not so interested in the methods of estimation at this time just the process of bidding. Please keep that in mind when you are responding.

Mike


1. Who is in charge of keeping track of all the bids? What is the technical name for this person?
2. Who decides which bidder gets the job? Is it typically the lowest bidder with the best skills for the job?
3. How much money does the person who keeps track of the bids take out?
4. How do they figure out the starting price of the first bid? Is it just the first person to bid makes the bid or is it a set amount? Are the bids secret from other companies or general knowledge to all of the companies in the process of bidding?
5. Do companies bid more then one time on a project? Say company 1 bids $95,000 and company 2 bids 90,000 and company 3 bids 89,000 would company 1 try to under bid them to get the job?
6. What kind of information does a person need to place a bid? Who gets this information for them?
7. Does the person/company who wants something constructed hire an architect to draw out blue prints and/or materials list? Does the architect just draw out the blue prints and describe the materials and the person bidding on the job has to decide how much materials they need?
8. When does the bidding usually happen? Is it a few weeks, months or years prior? In what season?
9. How long does the bidding typically last for?
10. Approximately how many people usually bid on a single job?
11. What if one company cannot complete the whole job? Does each different set of tasks on a job require a different set of specialists from several companies? Do companies typically bid on the whole job or just the part that they specialize in?
12. What is the average profit percentage that a company would make off a single job?
13. Is there a general way that all companies go about bidding or do they all use different methods?
14. Is there anything else I may have missed that you think would be important for me to know about this process?

Mike Finley

Holy cow, is this for a school paper or something? Do you have any basic skills or knowledge at all about the construction business? Because answering those questions would take a book and about 10 hours I would think, or they could be answered with one answer - "depends".

Treasurehoard

No its for some personal research that I am doing for a business I would like to create. I do have a general knowledge of the construction industry but only from what I learned when I was working with a crew from a small town. The process that they go through to get jobs is basically word of mouth and so I want to know how other people go about getting jobs perferable the way companies at bigger cities work. I have been looking in books and if you happen to know a few that I could look in to find this information it would be helpful. All of the books I have went though so far have been totally junk. Just containing info that is so vague that it doesn't help to explain the process to me at all. I also know that all of those questions depend on where you are at and how you get jobs as to how they can be anwsered. I just want to get an idea of how this process works in various areas around the United States at this time

PipeGuy

1. Steve, Estimator
2. Bob, yes
3. $12.95
4. Carefully, set amount, secret
5. Yes, maybe
6. technical, Santa
7. usually, yes
8. 9:19 UTC, weeks or days or months, late mid winter or mid to early late
spring
9. 21 1-1/2"
10. 3 or 17
11. they get sued, sometimes, the whole part
12. anywhere from 1 - 5.6332...average = the square root of 11
13. general
14. yes

Ask an uninformed question(s)...
Sorry, I just couldn't resist.

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

PipeGuy

Dude- Do you know the old saying "it's not what you know it's who you know." There's a lot of truth in that cliche. Books alone won't get you where you're thinking about going. You've got to know who needs what it is you want to sell. There are many ways to discover that information. One way is to go to work for someone and pay attention to who they work for. Another is to use the membership list of local builder's associations to develop a list of who might need your service/product. Another way is to use "referral services" - there's a lot of talk about that topic in other threads on this forum. Mass mailings are another way to drum up business.
Word of mouth is hands down the best way. The more folks you know who want to buy what you have to sell, the better. In addition to knowledge you'll need green...$$...cash. Varying amounts depending on what you want to do.

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Cole

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Tulsa's Leader in Outdoor Living Construction | Facebook | Tulsa Pergola Builder | Tulsa Outdoor Kitchens

Treasurehoard

I know you can't learn everything just from books which is why I posted on this forum. I am interested in starting an original business with a service that is not yet provided in the construction industry to my knowledge. There is not a lot of information about this topic to be found anywhere. Which is why I am working from the ground up on it. Going to work for someone in this industry is not really going to help since that only gives me one point of view on how things work. I need a variety of how the industry works so that I can better format my business to serve all of the industry rather then a selective market so I can maximize my potintial profits rather then limit them.

Glasshousebltr

Tresurehoard thinks he's on to something. OK Treas I'll play along, What kina new wheel did you invent?

The technical santa thing was good Pipe.

Bob

Treasurehoard

well due to the originality of my idea I would prefer not to mention it here. Not that I think that your smart enough to do anything with it just that there is probably someone here on this forum who is. You act like because I am asking basic questions that I am dumb or something. The issue at hand here is that at least I am smart enough to ask these questions where on the other hand you, who knows about this type of business, has not given a single anwser to any of these questions. Perhaps it is because you don't know anything about the process? It seems like most of the people I have talked to in this industry don't know what is going on. Maybe that is a common problem that you should all get together and figure out. It would probably make things run smoother and cut down on costs.

hatchet

I'll give a short answer to each.. and more of a general sense - not necessarily for commercial or residential.
1. Depending on the type of procurement method - could be the owner, architect, construction manager, or general contractor. If not the owner typically it's an estimator.
2. Again depending on the type of procurement it could be the owner, architect, construction manager, or general contractor, or someone else. I would say it's the lowest qualified bidder.
3. Don't understand the question. The person who "takes out the bids" typically already works for someone interested in the project.
4. Don't understand the question. A bid tab should be produced to compare the bids against one another - again the lowest qualified contractor. It's usually good form to announce the winning contractor and let the others know who it was - it's up to you if you want to tell them the cost difference. We do most of the time.
5. No a date is set for the bid date and time - bids are submitted and opened. Typically a few hours later (after the bids are tabulated) the winner is announced. Owners have the right to not accept any bids and to re-bid the whole thing.
6. Plans, specifications, addendums, soil reports, etc.. The architect, engineer, owner, general contractor, construction manager (depending on method of procurement).
7. The owner can do many different things - put it out to design/build, hire a construction manager, bid to a construction manager, bid to a general contractor... the list goes on. The architect will draft and design the project plans and provide specifications (well they should anyway). And yes most often the person bidding on the project will do their own takeoffs - except some corps of engineer projects.
8. It makes zero sense to bid something years prior to start of construction in regards to material costs. Depending on what is being bid - will depend on the timeframe. If the whole project is being bid to general contractors it could be a month to several months - if it's bidding the concrete it could be a few weeks or less.
9. Last? The bidders might get a month or so to provide a bid - but the date and time is set in the instructions to bidders.
10. Depends on the project and scope of work. Probably not less than 3 per scope.. excepting specialty items like curved glass.
11. Not enough info. As in a GC or trade contractor?
12. Depends on the scope of work and project size. Could be anywhere from 1% for a billion dollar job or 25% for a 20,000 job.
13. All different methods - again depending on the type of scope it is.
14. Yes - if you're thinking of starting a company to provide project owners with bidding services - Good Luck. There is very little benefit for residential owners to do this - one more cost on something that is taking too much of their money anyway. Large commercial projects are typically done through a developer who will have their own forces or have an architect to provide that help.

__________________
Rich
WIT Construction Co.
Superior MT Contractor

Glasshousebltr

I'm sorry bozo, I mean Treas, sometimes I'm stupid like that. I didn't answer your questions for the same reason I didn't try to explain Darwins theory of punctured equalibrium. No one really gives a pile of brown stuff.

Bob

hatchet

Wow - I must be really bored.

__________________
Rich
WIT Construction Co.
Superior MT Contractor

Glasshousebltr

Yea Rich I think you might be. The bad thing is I don't think Treas will even appretiate your effort.

Bob

PipeGuy

Is this you Grumpy?

Hey Treasurehoar - you're right; most of the people in your "mystery industry" don't know what's going on. It's a common problem and 'the Man' and his cronies are trying to figure it out even as this is written. But first, they have to stay up all night, losing sleep, to come up with some devious new ways to keep guys like you, Richard James (invented the Slinky), William Mitchell (invented PopRocks) and Al Gore (invented the internet) from getting one over on them.
Guess what - Bill Gates didn't get where he is by telling everyone they were idiots. He did it by letting them think they were geniuses. You'd do well to take note.

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Glasshousebltr

Bravo Pipe.

Bob

Treasurehoard

Thanks Hatchet that was a real help.

PipeGuy

Tell you what, if you're so eager to learn 'how it's done', and you have some great ideas on how to lower costs, then I invite you to come volunteer in my office 15 hours a week for a year. I'll even buy you lunch everyday that you show up on time. At the end of the year you owe me nothing for having afforded you the opportunity to get first hand answers to the questions you've posed. What'ya think?

__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Treasurehoard

ha ha ha thats funny cuz you called me a clown and said my idea was crap. O here is the part where I should come up with an insult. Really though I can't think of anything dumb enough to compare to you. I mean a rock would be good but then again rocks have been around since pretty much forever and you have only been around since your daddy made a mistake with your momma and forgot to pull out.

o and sure Bill Gates didn't get rich by calling people dumb. Luckly enough we all know you are probably to stupid to even obtain 1% of the weatlh he makes in a year otherwise we would all be in trouble.

Treasurehoard

Yeah like I said I am not interested in going to see how just one company works. I need a variety of information. Also I don't do work for free since that comprise my work ethic of doing it only for money. Obvisously you don't know anything about the questions I asked anyways so I doubt going to work for you for free is going to teach me anything except about slave labor. Where are you from anyways Mississippi. They outlawed that kind of thing back in 1865 ever where else.

Treasurehoard

I just got done going through some of you guys other posts on this site and it seems like all you do is have a negative comment for anything that anyone says. Don't you have anything worthwhile to add to this site or are you guys just a bunch of losers who have nothing better to do with your time. Hell you guys probably don't even have anything to do with the construction industry your probably a bunch of punk 15 year old kids who are hidding out in your basements with your pale faces covered with acne and your hands covered with blisters from looking at to much internet ****.