For many of us, we start our work as contractors looking for big jobs that are going to make a huge economic impact – and make a name for ourselves. We might do ok with a lot of small projects but still have that dream of doing something on a grander scale. But getting those jobs often involves a competitive bidding process. So how do you go about preparing a bid?
What’s the Purpose of a Bid?
At first glance, a bid may seem like just another term for a quote or estimate. But that’s only a part of it. It’s also much more.
A bid is really an opportunity to sell yourself and your capabilities. It’s a sales and marketing tool and a quote rolled into one. It’s an opportunity to express what you can do. But you also want to show your understanding of the project you’re bidding on and the company or institution it’s for. And of course, you want it to make sense financially for them and for you. In short, a bid is a way to get a job by demonstrating that you’re the best-suited contractor to do it.
With smaller projects, especially residential ones, there usually isn’t a need for a bidding process. A prospective client might ask for prices from a couple of companies, or they might not even go that far. But they don’t usually go to the lengths involved in bidding.
However, larger businesses and government agencies are interested in getting more information. They might even be required by their own statutes or by law to get at least a certain minimum number of bids before awarding a project.
Winning a contract like those can make a huge difference for your business, so it’s key to prepare a full, complete, and persuasive bid.
Key Elements to Preparing a Bid
There are a number of elements that should be part of every bid, and it’s important not to leave any of them out. This isn’t an outline – your bid wouldn’t normally follow this as a pattern. It is, though, a summary of all the concepts and ideas you should be including throughout the bid. Let’s have a look at them all.
First of all, it’s important to submit everything that’s requested, in the way it’s requested, by the date it’s requested. Many bid requests come with detailed instructions that explain what’s needed. That’s especially true when dealing with government projects.
When there are instructions, it’s essential to follow them as closely as possible. Provide all the information that you’re asked for. Include whatever supporting material needed. Failing to do so could lead to your bid being disqualified from the get-go.
Show That You Understand the Project
Since you’re preparing an estimate as part of the bid,of course you have to understand the work at hand. But you need to show that to the people evaluating the bid, too.
What is the scope of the work? What is required to complete it? What are the particular challenges? You almost want to explain the project back to them in detail while also addressing specifics that they may have left out, as well as how you’ll address all their requests.
For instance, let’s imagine installing a concrete surface in the outdoor areas of a shopping mall. Are there areas where heavy vehicles like trash trucks will have to cross? Will these areas require additional reinforcement? Has wheelchair access been taken into account?
While some projects might be “fully specified”, it helps your cause if you can point out important details that may have been overlooked. After all, in the long run, it will save money for the client if they don’t have to go back and change things later!
Ask questions of the client and do research on your own to make sure you really understand the need. Reflect all you’ve learned in the bid.
Show That You Understand the Client
While understanding the client is important, so is understanding the client.Obviously, they are about more than just the project you’re bidding on.
For this, it might be better to draw an example from the field of medicine. We’ve all heard about, even if we haven’t experienced, the doctor who can come into a room, look at the chart, discuss a disease and how to treat it. But they never talk to the person they are treating or even learn their name. That might seem like an extreme case, but it does happen sometime. It’s easy to fall into that trap of focusing on the task and forgetting the bigger picture.
As a contractor, it’s good to establish a connection to the client and the bid is an opportunity to do that. How does your service connect to their whole business? Don’t just talk about your small part in what they’re doing; show how your work will help them fulfill their whole mission. For example, if the project is at an office building, you might point out that you’ll work on weekends. However, if it’s a shopping center, you’d want to stick to weekdays when it’s not as busy. Let the client know you understand that.
Knowing the client can also extend to knowing their names. Directing a cover letter to “Mrs. Smith” shows that you took the time to research who is involved in evaluating in the bid. It’s much more effective than simply starting with, “To Whom It May Concern.”
As we mentioned above, your bid is an opportunity to market yourself on more than just your price. It’s a chance to show off your body of work to date and how that qualifies you for the project at hand.
This does require balance, of course. There are people who tend to talk about themselves too much, while others are reluctant to discuss their accomplishments at all. Neither of these will serve you well.
It’s important to be able to state your qualifications for the project at hand in an objective manner. Discuss your past experience and similar projects you have worked on. If the job you’re bidding on is much bigger than other work you have done to date, explain how you’ve prepared for this new level.
Have you been recognized with awards or discussed positively in the news, magazines or blogs? Those help as well. They all serve as references that will give some reassurance to your new client.
Explain the Value You’re Providing
In general, when you are making a bid you are writing to a person or a committee that doesn’t have your level of knowledge in your field. So it’s important to explain to them the value you’ll provide.
For instance, explain the benefits of using certain types of material or tools. This is especially important when they distinguish you from your competitors. Will you use a certain product because it will last longer even though it will cost more up front? Spell that out in your proposal.
Even if you use an “inferior” product, be prepared to explain that. For instance, some similar projects might have used elements that are particularly resistant to winter weather. That might make them the “best” and most expensive – but there’s no need to go to that expense if the bid is for a project in south Florida.
This might be a bit redundant based on what we’ve said, but it’s key to a successful bid and project completion to be detailed about the proposal.
We’ve talked elsewhere about how to prepare an estimate so we won’t go into that here. Just remember to be expansive and not leave anything out.
Another place where detail is key is with the scheduling of the project. Create a reasonable calendar that shows when the client can expect various phases to be complete. Don’t give just a final completion date; break the work down into stages so that the client can see progress is on track. Don’t forget to take into account the climate at various parts of the year!
Finally, specify dates is key for when you expect to get paid. With most big projects, payment is usually made in several stages, with a deposit before work commences and additional partial payments when various levels of work are completed. And of course, the final payment comes after work is done. Include that in your bid, as well, so that everything is clear from the start.
A lot of time and effort goes into creating a successful bid. But remembering the points we’ve included here will have you on the right track. They are not necessarily distinct sections of the bid, although at times they can be. But taken together, these factors help to show that you have the knowledge, skill, and desire to take on the task. So start doing your research and preparation, and good luck in the process!