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A project delivery method


A construction bid is the process of providing a potential customer with a proposal to build or manage the building of a structure. It’s also the method through which subcontractors pitch their services to general contractors. 

In order to create successful construction bids, remember the industry golden rules: Start with highly accurate cost estimates, and submit the lowest bid of all the competing contractors. The process of forming a bid begins with examining construction plans and performing material quantity takeoffs. If you’re interested in learning more about construction planning, visit this comprehensive guide to construction plans. However, there are a lot of nuances and complexities behind this seemingly straightforward formula. We will delve into those in detail later on.

First, it’s important to distinguish between a bid and an estimate, terms that are sometimes used interchangeably. The definitions of the two are somewhat elastic. Generally, an estimate is the calculation of the contractor’s internal costs (including materials and labor), while a bid is the final price charged to a customer. We consider a bid to be a firm offer to the customer. The difference between the bid amount and your expenses is your profit. Using construction bidding software can help ensure you’re bidding the right amount. Sometimes, on small jobs, the customer may move quickly after reviewing just an estimate, treating it, in effect, as the bid that will represent the formal terms of the deal.