Many large GCs (upper 400) on commercial work mark up the major sub's bids a percentage depending on the past experience with them. This is because of a lesser risk and known performance. They just use their standard rate for new and unknown subs to protect themselves.
Later, when it comes to buying on a large job with some alternates or a tough architect they will buy from a known sub/supplier because they cannot afford to take a chance on an unknown or a cheap sub's price. The low prices are used to get a reasonable price and package from a known sub or supplier.
That is where selling/marketing (not peddling and bidding) and performance become important if you want to regularly do business as a partner with established large firms.
