Ways to Reduce the Cost of Bidding
By Ed Krum
In today’s competitive market, everyone is looking for ways to reduce overhead in every aspect of their operation. This includes the basic costs associated with estimating projects.
The old adage, “it takes money to make money,” has gone out the window. The opportunities to connect with your clients, subcontractors and suppliers via the internet has changed the way most companies look at estimating.
In the past, procurement of the plans and specifications by means of either a deposit or direct purchasing was both costly and cumbersome. With the advent of electronically distributing the bidding documents either via disk, FTP site or electronic plan room, you can reduce the cost to only printing the plans you need and, in most cases, a reduced size set (11×17). This now allows the general contractor more access to many more subcontractors in various trades to ensure a quotation is received. This makes things much easier, since sorting through pages of documents is no longer necessary.
While electronic document management may seem very obvious, it takes a dedicated person to contact each and every subcontractor and supplier to remind them of the proposal required from them.
Owners, developers and other entities that bid out work are slowly catching on to benefits of electronic submissions and are now letting contractors submit their bid/proposals electronically. This change in attitude by owners has now allowed contractors to take advantage of the “late” arriving subcontractor bid, thus reducing the overall cost of the proposal to the owner among other benefits.
Although there is no sure-fire way to reduce bidding cost, prudent general contractors only peruse the bid jobs that have the best advantage in their favor of winning. While larger projects are tempting, they also draw the most bidders and, therefore, are harder to compete. This type of bidding is like throwing money away. Ardent contractors will try to find those projects where the amount of bidders is limited in order to increase their chances of being successful.
Whatever type of project you choose to bid on, electronic bidding allows you to streamline communications, check on bidding subcontractors and suppliers, and use the system for document management.
Ed Krum, Senior Estimator for Triune, is a highly accomplished, multi-talented project manager with over 25 years of commercial construction experience. He is skillful and highly regarded in value engineered, conceptual, competitive, negotiated and design-build estimates.
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