What is Bidding in Construction?

January 20, 2024

A well-crafted construction bid is the key to landing projects and growing your business. If you’re a contractor, your bidding process is like a job interview-it gives project stakeholders a first impression of your capabilities and shows them whether or not you are a good fit. If your company’s values and capabilities align with the client, you will move forward in the bid process.

When submitting a construction bid, you’ll need to provide a cost estimate based on blueprints and material takeoffs. Then, you’ll need to include a proposed schedule, budget and terms and conditions. Depending on the type of project, there may be requirements to submit a bid bond or other financial assurances.

The method of bidding can vary based on the project requirements and bid types, including open tendering (where an RFP or RFQ is sent out to all interested contractors) and negotiated tendering (where the GC negotiates with a single selected contractor). For example, if a private developer is new to an area or the project requires specialized expertise, it makes sense for them to invite all qualified contractors to bid on the work.

In the case of an open bid, the project owner evaluates all bids to select the lowest price. However, in a competitive market, there are many factors that influence the decision beyond just price, such as the quality of the contractor’s past experience and the reputation of the firm. A high-quality website, professional certifications and attending industry events are all ways to build brand recognition and gain name recognition during the bid selection process.


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