Bidding on a construction job depends on either you have the required skills to complete the job and if you offer the lowest amount of bid. Offering the lowest estimate requires a lot of analysis as getting the job with a low bid does not always result to spending less but may make you suffer legal obligations on projects either not met or completed as per the contract.
A contractor is therefore required to determine the lowest amount of bids they can offer to secure the project yet maximize profits not to go out of business. This is not an easy task especially for a new contractor in the construction field.
How to Bid on Construction Jobs
Where to look for leads for construction jobs
When looking for leads a contractor should go far and wide and should not only rely on a newspaper advertisement. Many clients usually post their advertisement in the newspaper but sometimes this only works to formalize the activity.
Getting known in the field, however, the best as you do not only get new clients but also referrals to clients you probably could not have been able to meet. Referrals are also a great source of clients as you might get hired before the whole bidding process depending on your client reviews. New clients can also be targeted through advertising on both mainstream and social media.
Creating a website for example and marketing it to clients can also generate a good amount of traffic translating to a substantial amount of clients. Creating a forum where clients can share their experience can also leave a positive amount of good review making the client comfortable with giving you jobs that seem risky to other companies.
When biding for a constriction project you will need to submit a bid sheet. This is the document all constructing companies provide in the tendering process. After getting the tender you might have to submit either the design out for other bids or use it to generate the construction bid proposal that is used now to request for the construction project itself. Although many clients use a construction company in the two whole processes, some might insist on architects to do the first step.
When looking for a construction project getting the right estimate cost is one of the most difficult activity on not the most. This is because you need to generate a profitable yet competitively low figure to win the tender in the first place.
When bidding on a project, putting reasonable costs is always better than giving a low amount that may not fish the whole job. This is because once the tender is awarded to you, you are required to sign the contract or get charged a bid bond. This is the amount you request from the financier, a bank or a legal business to offer you the bond to the obligee the business requesting the tender. You as the principal suffer when you decline the offer after being awarded to enable them to get the second lowest bidder’s costs. This, in the long run, can be negative to your business.
When estimating costs the business should make sure to include any market fluctuations, labour and any other unforeseen costs that can be incurred. When giving a quote for the first time for a business, getting advice is also a great option. This gives an insight into what is about to be encountered in the project and other hidden costs that may come with it. Securing performance bonds after being awarded the tender also plays a big role in sorting the obligee in case you fail to deliver as a business. This, though a requirement, gives a business the peace of mind instead of having to face legal issues.
Construction bid software can provide estimate solutions as they evaluate from past jobs and iterate according to market changes. This makes them a perfect, simple and easy to use the tool when estimating costs. Although the software might cost a small amount of fee but can save on lots of time and other precious recourses.
How to finance your contract as a contractor
When biding for construction jobs you need to have a variety of financing options. When you get the tender you will have to either deliver or get charged with either bid bonds or performance bonds. This can be very harmful to your business as it makes you work on the deficit at a time that you do not have enough financial resources.
At Momentum Credit, however, we believe this should not be a challenge. We offer Guarantees from reputable banks within 24 hours. We also offer loans and make the process easy and simple as there is no account opening and other securities involved. All this is geared to expand your possibilities as a business.