A well-structured bidding process is critical for driving down costs and minimizing change orders and delays in capital and construction projects. With billions in project value managed through our platform by major real estate owners across North America, we've pinpointed where best practices truly matter—and where teams tend to stumble.
Here’s a look at some of the most impactful bid management strategies to refine your process:
Ensure every bidder receives all necessary documentation to understand the project scope. If you’re not using an automated bidding platform or an FTP site with read receipts, assign a junior project manager or coordinator to verify that each bidder has the latest document package.
Remind bidders of due dates a few days in advance and again on the deadline day. This small but often overlooked task reinforces the importance of your timeline.
A site walkthrough allows bidders to examine project logistics and reveals how well they’ve reviewed the plans. Contractors who come prepared with specific questions are often those who have taken the time to understand the project’s details.
By having bidders submit RFIs electronically to the project manager and the architect, you ensure prompt responses. Shared RFI documentation helps prevent contractors from omitting questions to later file costly change orders.
When the architect or engineer issues an update, distribute it to all bidders immediately. Timely updates keep bids accurate and prevent delays.
Watch for bidders who lump items together. If one bidder breaks out the fire alarm from the electrical system while another combines them, make adjustments to compare bids accurately. Note these adjustments and follow up with clarifying questions if necessary.
When bidders include allowances (estimates for uncertain costs), push them to replace these with firm numbers as quickly as possible. Firm pricing enables you to make more accurate comparisons.
Negotiating is most effective during the bid process, not after the contract is awarded. Include potential add-ons as alternates so that if you decide to proceed, you have a confirmed price from the winning bidder.
Opting for a smaller, targeted bid group can yield better prices. Contractors may invest more time and detail into their bids when they have a higher chance of winning.
After awarding a bid, remember to thank the unsuccessful bidders. Showing appreciation fosters positive relationships, encouraging vendors to keep submitting quality bids.
For multiple, similar jobs around the same time, package bidding can provide economies of scale. Create separate bid forms for each scope but expect a discount if you award the entire package to one vendor.
By implementing these strategies, real estate owners can bring more control, predictability, and scalability to their bidding processes, ultimately enhancing project outcomes.