Online Bidding

paroofer

I just received an email from a lead management company. We are invited to bid on a commercial flat roof in our area. It is all done online. I think this is risky, since contractors don't get to actually see the job in person Someone from the lead co. has gone to take pics, measurements, and core sample blah blah blah...Contractors may post any question pertaining to job, and (supposedly) have it answered.
Does anyone else think this is a little crazy? I know people are trying to rely more and more on technology to get things done more streamlined, but our gut feeling is to always look at the job in person.
Oh yeah....the cost is $100 to bid and get detailed info. The winning bid then pays $2500.00 Seems a bit large
Has anyone done this?

Bob Kovacs

Seems very risky. A few questions:

- Is the job nearby? If so, why can't you go look at it yourself?
- What's the overall project size? If it's a $10,000 job, $2,500 is steep for getting the job. If it's a $300,000 job, it might be worth it.
- Can you qualify your bid? In other words, since you're basing your bid on second-hand info, can you go after change orders if the conditions represented in the photos aren't accurate? Is there a way to specify exactly what's included and excluded, what you've assumed, etc., or is it just a number submission?

Online bids aren't bad for jobs like re-roofs, where it's all just "plans and specs".

Bob

paintr56

Are you sure there is a job? I can't imagine paying to bid on a job. Will you at some point get to verify the job was acually done by someone who won it through this bidding process? This could be the sceptic in me.

Jim Bunton

Pearce Services

Beware of the Reverse Auction........Sonny Lycos mentioned it on this site before. I believe that Reverse Auctions actually got their start on the internet.
Reverse Auction is an online open bid process where a bunch of guys bid for work, and someone undercuts them, then they all lower their prices. The lowest price is seen by all, it gets to the point that no one could possibly do the job for the price.

Every time someone offers a lower bid, the auction gets extended so guys can see the new price, and drop their price more.

If you get a chance to rebid, then you may want to avoid this process.

BTW, another way they can do this is to have a budget, not advertise the amount, go to online bid for a one time firm fixed price, and when all is done, go back to the bidders, and say that no one will be awarded the job because every bid exceeded the budget amount. Every one is then asked to rebid. They are banking on the the fact that the guys bidding will all drop their prices at this point.

paroofer

I don't trust this process either, and we certainly aren't going to pay to bid a job when we are busy with the leads we get ourselves!
I would reconsider if this is the way things are headed with the stinking internet.

I did read an article a while back about reverse auctions. I hope that doesn't become the norm. All our prices would be driven down.

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Be nice, I'm just a girl

Pearce Services

4-6 years ago, reverse auctions were used by some larger corporations for large purchases, mezzanine, racking, lifts, etc.

Many legitimate vendors issued a no bid, and came out with a letter to the purchasing departments stating they they would no participate in any Reverse Auctions.

The results were not very favorable, they ended up with inferior service, and were never able to get their vendor of choice....all relationships were out the window.

There seems to be a trend away from these auctions for products that require installation, and service.

I do not know if the guys selling commodity, non service products like Paper, or raw materials will ever be able to get away from this, but for us service related tradesman.........They can not have reverse auctions if we all refuse to participate.

AAPaint

Sounds like a frickin joke to me. Pay $100 just to bid and see the details knowing you'll be underbid....yeah, right, I'm all for that. Oh wait! There's a $2,500 string attached. So, in reality, you're paying $2,600 to get one job? I thought the lead services were bad.....this one is the scam that tops all the other lead providers.

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-AAPaint

AA Quality Painting & Pressure Washing LLC
Jacksonville Painters
Jacksonville, FL.

paroofer

Glad to hear I'm not the only one who thinks this is crazy. I sure hope it does not become the norm for large jobs.

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Gordo

I have an idea lets start having reverse auctions for medical service, workers comp., food items......sarcasm.

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Looks like some pros were here.

paroofer

No one else would dream of taking a pay cut in their jobs....I don't know why people insist on doing that to tradesmen.

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Be nice, I'm just a girl