Introduction
Nothing is more aggravating to a contractor than having spent countless hours; late nights and lost weekends, carefully preparing a bid, and then receiving the one line email: “We have chosen to use a different company.” You know you did the best work, and you know you charged a fair price. Then why are you losing the bids to your competitors whom you are sure you can do better?
The reality of the situation is that in the current market place the lowest price rarely wins the day. It goes to the contractor that is able to convey their value, professionalism and trustworthiness the best. Your bid is not a number, your bid is your audition. It is the most critical marketing document that your company will ever create. Now it is your opportunity to show that you are a professional and can be entrusted with such an important financial and emotional investment of a client.
When you feel that you are in a rut of bidding and losing then it is high time to switch your strategy. This playbook will take you past the stage of merely pricing jobs to a more comprehensive style of winning jobs. We are going to discuss the three key elements of an effective bidding strategy that include unmatched precision, formal presentation and smart follow up.
Step 1: The Foundation – Unbeatable Bid Accuracy
Your numbers have to be perfect before you can consider presentation or strategy. Any bid that is based on guesswork is a house of cards, and it is just waiting to fall into either a lost job or a win that nets no profit. The precision is the key to trust and profitabilit
The Dangers of “Guesstimating”
Your worst enemy is a ball park figure or a price that is founded on a gut feeling. It sends the message of indolence to the client and puts your business in the line of colossal financial loss. A high bid which is not accurate will automatically lose the job. A low bid that is not accurate is even worse, you win a project in which you are bound to lose money, you work under pressure, and may end up compromising quality, which affects your reputation. Each project has to be estimated literally on the ground up considering the specifications of the project.
The Importance of Detailed Line Items
One lump-sum price is not persuasive. A professional bid subdivides the project into its essences. This line-item, micro-level budgeting performs two effective things:
- It Justifies Your Price: It Justifies Your Price: It helps the client to see where every penny of his/her money is spent; the price of the materials, the particular stages of the workforce, the permit cost, the garbage disposal. It changes your price, which is just a random amount to a rational sum of real costs.
- It Builds Trust: The currency of credibility is transparency. Exposure makes the client see that you have nothing to hide. You show yourself to be a hardworking, well-organized professional who has thought of every detail of his or her project.This level of detail is something we explore in all our trade-specific guides, like The Plumbing Estimating Masterclass, where every fitting counts.
Building in Contingency and Profit Correctly
All estimates should have contingency and profit line items. A contingency fund (usually 10-20%, depending on the complexity of the project) is not “padding”; it is an important risk management tool to address unseen problems. Your profit margin is your compensation to having taken the risk to be in business. These numbers should not be hidden, you should be ready to justify the reason behind them. A client that realises you are operating a healthy business is a client that will believe that you will be there to honour your warranty.
Step 2: The Presentation – Professionalism That Sells
After you have good numbers, you have to make sure you deliver it in a package that shows the quality of your work. When your bid appears amateurish, the client will conclude that your work is as well. It does not matter that you are the best craftsman in the world, but when your proposal is a mess, you will lose to the competitor whose document looks better.
Your Bid is a Marketing Document
No more looking at your bid as a price sheet. It’s the most essential thing you do in marketing. It must be neat, branded, readable and all inclusive. This is your chance to narrate the story of the project and establish yourself as the best person to lead the project into reality.
Elements of a Winning Proposal Package
Professional bid is not just a spreadsheet. It is a full proposal package which consists of:
- A Professional Cover Letter: In a nutshell, tell them about your company, about your excitement in the project and a summery of why they should choose you. This personal approach is tremendous.
- The Detailed Estimate: The line-item breakdown of costs we discussed earlier. It should be clearly formatted with your company logo and contact information on every page.
- A Clear Scope of Work: A narrative description of the project, outlining the major phases and deliverables.
- A List of Exclusions: Clearly state what is not included in the price to prevent misunderstandings later (e.g., “Final painting of client-supplied fixtures is not included”).
- Your Credentials: Include a page with your license number, insurance information (proof of liability and workers’ comp), and any relevant certifications.
- Testimonials and References: Add the quotes of 2-3 happy customers to use the social proof.
Use visuals, whenever you can. In case of renovation, add before and after photos of the similar work. In case of new constructions, you should add renderings or portfolio pictures. A picture is worth a thousand words and it will enable the client to visualize success with you steering the ship.
Step 3: The Strategy – Bidding Smarter, Not Harder
To win more bids, it is not enough to make your proposals better but to be more strategic about it. That translates to picking battles, having a sense of the competitive environment, and the follow-up.
Knowing Which Jobs to Bid On (And Which to Avoid)
A lead may not be a good lead. You cannot bid on each and every opportunity that comes along without risking burnout. Establish a process of qualification. Is the project within your comfort area? Is the budget of the client realistic? Are their expectations in line with what your company believes in? When you learn how to gracefully decline the wrong-fit projects, you will have so much time and energy to dedicate to making flawless proposals to the right jobs that you desire and are capable of winning.
Understanding Your Competition (Bid Leveling)
You will seldom be the only person who is bidding on a job. Your detailed professional bid is your best asset when you are aware of being in a competitive situation. Shrewd clients and general contractors will do what is known as bid leveling; they will lay proposals side-by-side. A general, lump-sum bid is not susceptible of being leveled, and is usually thrown away. An itemised bid lets the client compare apples with apples and although your price might be a little higher the clarity and professionalism with which you have presented yourself often carries the day.
The Art of the Follow-Up
The step of submitting the bid is not the last one. Professional follow-up can be the difference-maker, especially when it is polite.
- Confirm Receipt: A follow-up email the day after the submission just to make sure they got the proposal as well as to check whether they have any preliminary inquiries.
- Schedule a Review: Offer to schedule a 15-minute call to walk them through the estimate, explain the scope, and answer their questions in real-time. This is your chance to build a personal connection and further demonstrate your expertise.
- Be Persistent, Not Pushy: A gentle reminder a week later is appropriate. Frame it as being helpful: “Just wanted to check in and see if you had any more questions about the project timeline or materials.”
Fusion Assist Spotlight: Your Unfair Bidding Advantage
What you may be saying to yourself as you read this is, “This all sounds very well, but who has time to go and do all this on each and every bid? It is the very issue that we address. The driver to a professional bidding strategy is Fusion Assist. We provide you with an unfair advantage, as we take care of the most time-consuming aspects of the process, and you can concentrate on selling, managing, and developing your business.
- We Deliver Unbeatable Accuracy: Our team of expert estimators and our advanced software ensure your numbers are rock-solid. We perform detailed takeoffs for every trade, so you can be confident your bid covers the true cost of the job.
- We Provide Professional Presentation: We do not simply e-mail you a spread sheet. We provide a professional bid package that is fully completed and ready to give to your client with your logo on it. We give you the line-item estimates that make you appear the organized professional that you are.
- We Give You Back Your Time: Whereas your competitors are losing their nights and weekends trying to estimate, you can be having client meetings, making follow-ups on hot leads, or inspecting your ongoing projects. Leave the paper work to us and you have time to implement the winning strategy.
Case Study: How a GC Increased Their Win Rate by 40%
Client
A skilled general contractor who does home renovations.
Challenge
The contractor was a highly skilled craftsman but was losing bids always. His proposals used to be a one-page, lump-sum price made in a word document. He was aware that his prices were competitive and yet he was losing to other contractors who “appeared” more professional on paper. He was wasting time and getting frustrated on bids that did not go anywhere.
Fusion Assist Solution
The contractor has chosen to give our service a go on his next three bids. He forwarded to us the plans of each project, and his notes. We sent back three fully completed, multi-page proposal packages, each accompanied by a cover letter, a line-item cost breakdown and a well-defined scope of work.
Result
The change was instantaneous. This was the first professional proposal made by the contractor to a client who had two other proposals in mind. Detail and transparency impressed the client so much that he canceled his other appointments and signed with him immediately. Two out of three first jobs were won by him. Outsourcing his estimating to Fusion Assist allowed him to put in tenders on a lot more jobs and allowed him to put in a much better proposal. In half a year, he had boosted his project win rate by 40 percent and could afford to employ a new project manager with the additional revenue.
Conclusion: Stop Pricing, Start Winning
It is a science to win construction bids in a competitive market. It involves a strategic move, to get past the mere notion of merely pricing a job and move on to a more holistic approach involving a mix of precision, professional touch and clever sales techniques. Your bid is your time to sparkle- to show your worth and to win the confidence of your client. When you base your bids on a platform of accuracy and deliver them with a well-groomed professional image, you transform the discussion to become who is the least expensive? to “who is the best?
Ready to turn your bids from a source of frustration into your most powerful engine for growth? Start with a world-class estimate from Fusion Assist. Let’s build your next winning proposal together.
Frequently Asked Questions on Bidding Strategy
How soon is too soon to follow up on a bid?
The 1-1-1 method is a good guideline. A day after submission, make a brief email confirming receipt. Follow up with a review by calling one week later to be polite. A week later, make a final follow-up email and then place the lead in a long-term nurture list.
What about negotiations on prices?
Don observe the scope and simply reduce your price. When a client requests a reduction in price, you should be ready to give choices. Example: To arrive at that budget we can change the quartz countertops to a high quality laminate, or we can change the tile. Shall I make out a corrected choice? This keeps the worth of your work and is beneficial.
Is it good idea to be the low bid?
Rarely. It is always good to be the low bidder, then you are either leaving costs out or you are making no profit. It may also wave despair or lack of standards to the customer. The objective is to become the best value, not the low price. The key to showing that value is a professional proposal.
How can I act after losing a bid?
Request feedback at all times. Write a nice email and say, “Thank you very much, for the chance. Would you mind giving us some feed back on our proposal or your main decision reason, to help us improve our process? You will not necessarily receive a response but the feedback that you will receive is solid gold.
Do I have to pay to make an estimate?
For most standard projects, a free estimate is the industry norm. However, for very large, complex projects that require extensive pre-construction planning, design work, or engineering consultation (often called a Project Development Agreement or PDA), it is appropriate and professional to charge for this in-depth discovery and estimating process.
