Bidding a construction project is scary, but it doesn’t have to be. Sending a bid out to a General Contractor can be intimidating. Afterall most General Contractors have been around the block a time or two. They know where to exploit gaps in information. Of course this isn’t true for most GCs out there who we find to be quite ethical. But knowledge is power and the more you know before the bid, the better prepared you will be to ask questions, evaluate the GCs and make a confident selection.

What information do you need to provide

First you need to have the right information. This means that you need to be able to describe the project as completely as possible. Usually this means arhitectural drawings and specifications. You can find Architects that work on virtually any type of building type. The Architect is responsible for drawing the plans and describing the quality of the materials. Designing any space or buiding is a collaborative process and the Tenant or Client should be very involved.

After plans are completed you will need a bid form. The bid form is a standard form provided to each bidder. It should include project location, size, tenant/company, project scope, important exclusions and assumptions. Also, a bid form should include a list of categories for the bidder to assign costs. This is called the schedule of values.

Next you will need a bid invitation. A bid invitation needs to include the general bid rules. The invitation should be clear about who you are, when the bids are due, how questions should be asked, etc. The bid invitation does not have to be complicated.

How to find the right bidders

Finding a good General Conractor to bid your project can be a challenge if you don’t know where to start. You want to trust the contractors you are bidding to. Not only do you want the bes price but you want to have faith the contractor will be honest and have your best interest in mind.

You can find a good contractor in a variety of ways. The best way is have direct experience with a group of contractors. Afterall nothing beats personal knowledge.

If you don’t have a stable of contractors, your Landlord might. Landlords work with general contractors all the time and have great insight on which companies work best in their buildings.

Next the real estate brokerage community is a great source. Tenants rely on brokers to help them understand high level pricing and brokers frequently communicate with contractors for that reason. Also, brokers typically work for large corporations that have project managers who can help with referrals.

Finally other tenants will have recommendations if they have recently constructed their own space.

What information should the bidder return

First the bidders will need to return their bid, which should be on the bid form you’ve already provided. Usually bidders will like to include their own bid form as well.

Next the contractors should provide any qualifications or exclusions. They will let you know if they have not provided something which gives you better context on their price.

Next you should look for a reasonably detailed schedule that shows major milestones and the durations of common tasks. Of course you need to know when the project is expected to be completed as well.

Another item provided by many contractors is a portfolio of work and a list of team members. This is helpful to you to understand a contractor’s expertise and their overall experience both at a company and personal level.

How you should compare bids and make a selection

Comparing bids is critical so you can take an objective look at each bidder’s numbers. You use this step to put all bidders on even footing so you can clearly see where they fall relative to each other. You should use a bid comparison worksheet to help you see all the bids together in one place. This is as easy as a cut and paste if you gave the bidders all the same bid form.

While the bid comparison will show you the lowest bid, you have to be sure you understand the exclusions or other bidding comments. Sometimes a contractor bid will look great but have a qualification that voids any possible savings.

Next you can review the schedule to reveal overall timing. A contractor may cost more in aboslute dollars, but if their schedule is quicker you may be able to benefit by being in a revenue position sooner.

A good idea is to interview the bidders. These interviews give you the chance to understand the contractor on a more personal level. You can also get a feel for their company culture and how they respond to problems. An interview is also a great opportunity to get into the weeds on the contractors business processes.

Finally remember that the best contractor choice for your project may not be the lowest cost and it’s important for you to consider all angles of what the contractor is offering. When you make a selection be sure you notify all the bidders in writing. It’s important for you to give the losing contractors clear and concise reasons on why they didn’t win this time. After you make all the notifications you and the contractor can start immediately with the contract and going to work.