Putting together a bid proposal is an opportunity to grow your business and increase your revenue, but bids have the potential to make or break your business. Despite the potential a new job holds, things can get complicated if you’ve quoted a job too low or projects that you’ve tackled get behind schedule from a lack of equipment or labor. A mistake during the bidding process could be costly, but fortunately, you don’t have to make a mistake.
Mastering the Construction Bidding Process
Being an expert in construction bids isn’t just about knowing what to do. It’s also about knowing what not to do. There are a few key tips for avoiding mistakes when placing a bid.
- Don’t bid on every job that comes along
- Don’t overestimate the capabilities of your team or equipment
- Don’t overlook the details and fine print in the paperwork
- Don’t throw in a last-minute submission
- Don’t submit until you’ve asked plenty of questions
This quick list of don’ts can help you avoid mistakes before you get started, but there is always the possibility that an error or mistake will occur. Construction insurance can help with many of the liabilities of your operations, but addressing the mistakes of construction bidding may require additional work.
Addressing Bidding Mistakes That Can Throw Off a Project
In the construction industry, bid mistakes are resolved through rules and laws established by state or local governments agencies and between agencies at the municipality level. In some cases, you may be allowed to withdraw a bid without losing your bid bond. However, other mistakes can cost your bid bond and additional penalties.
Clerical Errors
One of the proactive steps to avoid making a mistake is paying attention to the details of the paperwork. Clerical errors are considered transposition with the numbers, typographical errors, or decimal points in the wrong place. Bids submitted in good faith but containing a clerical error may be withdrawn, but there is usually a requirement of credible evidence showing it was simply a clerical error. The contractor must notify the project owner promptly after discovering the error for a withdrawal to be considered.
Lapse in Judgment
There are times when a bid contains errors on account of poor planning or mistakes in judgment. Mistakes that fall under this category could include inaccurately estimating the cost of materials for the project or miscalculating how much time it will take to complete the job. Once the bid has opened, the chances of being able to withdraw the bid without penalty are low.
The process of estimating and submitting construction bids is already stressful,l and having to deal with a mistake can make the process more difficult and frustrating. Carefully read and review all bid documentation before you submit it to reduce the risks of mistakes.
About Haughn & Associates
Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.
