hard bid contract

5 Tips for Winning a Hard Bid Contract for Your Construction Company

Unless a project owner already has a contractor in mind, new projects are mostly always sent through a competitive bidding process. General contractors get the opportunity to place their bids and proposals for a chance to win the project. However, preparing bid proposals can be challenging, especially when it comes to securing a hard bid contract. While hard bids are common in commercial construction, they can be harder on the estimating team. Here are a few ways to improve your proposals and win a hard bid.

What’s a Hard Bid Contract?

The term “hard bid” is a common construction building method where an owner hires an architect or designer to draw up all the construction documents. Once the project plans are approved, the owner publicly makes them available for general contractors to bid through invitation or advertisement. 

The lowest bidder always wins the construction project regardless of qualifications where each bid represents the total cost the contractor believes is required to complete the project. The winning general contractor can then hire subcontractors for the job. 

hard bid
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Benefits of Hard Bid

When compared with other bidding types and methods, hard bids are lengthier. The owner may also end up paying more than necessary for the project. However, there are a few advantages to reap from the traditional procurement method.

  • The owner can compare the prices quoted by the bidder or general contractor.
  • Contracts drawn up for hard bids define each role for all parties involved.
  • The general contractor is bound and limited to the parameters mentioned in the hard bid.
  • The project owner gets the total cost upfront, reducing financial risks for the project. 
  • Every hard bid outlines the scope of work, which is beneficial for the owner and contractors.
  • Most general contractors and subcontractors prefer hard bids because they are a well-known and established bid method.

Other Construction Project Bid Types

There are more bidding types that a project owner might be interested in. They are all mostly the same except for how the owner solicits bids.

  • Soft bids, also known as negotiated bids, see the owner and the contractor collaborate to come up with a project budget. The owner also takes into account the qualifications, experience, reputation, and approach of the bidder (general contractor) in contrast to how hard bids work.
  • Selective bids are a sub-branch of soft bids. The owner invites a group of predetermined contractors to bid on a project. It offers a middle ground between competition and ease of doing business.
  • Serial bids are used when the owner is soliciting competitive bids for a series of similar projects over a given period. While it reduces competition, tendering multiple projects at the same time is preferred over soliciting bids for each project individually.

Tips for Winning a Hard Bid Contract

Understanding how hard bids work is only the first step to making the winning bid. There are several ways in which you can gain advantage over your competitors by pushing the best proposal possible to secure the project. 

Break Down the Bid

Many bids show lump sums. While this is convenient, it can confuse those reading the bid. Seeing exactly how a subcontractor or contractor breaks up their project finances can tell the person viewing a lot. The break up on a hard bid also shows your thought process for the project. 

For example, one subcontractor might have more money put aside toward equipment than another. In another example, a contractor might have less set aside for material costs. Both of these could explain why a bid is higher or lower, which gives the bid recipient a better picture of the contractor or subcontractor.

Accurate Math and Takeoffs

While obvious, a competitive bid process requires all bids to have accurate takeoffs and math. In hard bid proposals, the person accepting the bids will confirm whether the measurements are accurate. If the math and takeoffs are different from other bids, your bid will not be accepted. Using accurate measures, checking the math, and inputting the correct takeoffs is an easy way to win the next hard bid contract.

Ask Questions

Many hard-bid contractors prefer specific formatting for their contractors and subcontractors, which might not be clear at first. It is always recommended to know beforehand what the architect or the owner is looking for in the proposal. Sometimes talking to others who have worked with the architect or owner can also be a big help. They might be able to alert you to their potential preferences so that you can win the hard bid.

Showcase Your Qualifications

Another tip for winning a hard bid for your construction company is not to shy away from showing off your qualifications. The architect or general contractor lays out the work that needs to be done, and you know that your team is perfect for the job. However, they do not necessarily know that. By showcasing your team’s qualifications and experience, you help set yourself apart from other companies. 

The qualifications of your team and your company are as important as the price of labor, materials, and time. With a hard bid, many of the bids will be just slightly lower or higher. That is why your qualifications and the construction company’s reputation can help you win a hard bid.

Ensure Project Fit

While tempting, general contractors should avoid bidding on everything. This is not a winning strategy and, actually, shows inexperience. It is always important to confirm whether your company is fit to complete a potential project. Placing hard bids just because the lowest bidder will get the project may end up costing your company because, in the end, your company also has to make a profit.

Manage Hard Bid Construction With eSUB

With a myriad of bidding options available for soliciting contractors, it all comes down to the owners and what they find comfortable for their upcoming commercial projects. Whether that be hard bids or a hybrid option tailored to the owner’s requirements, using construction management software like eSUB helps keep projects on track. 

Its cloud-based collaboration features offer better insights into projects by ensuring everyone has access to up-to-date information at all times. Pull up job-site documents or send an RFI to the general contractor from any device or location. There is no need to scramble for the right information or juggle piles of paperwork.