Bidding Process

Several approaches to the Bidding Process and Contracts

A Negotiated Bid

A Negotiated Bid is the ideal method for client, contractor and architect.This process allows the contractor to prepare budgets based on preliminary plans. the contractor is then able to offer valuable information to various aspects of the project. These suggestions can then be incorporated into the plans as the are developed . Using this approach allows the plans and budget to be developed together. It also helps strengthen the communication between homeowner, contractor and architect from the beginning. Negotiating also takes into consideration scheduling and length of project. Most importantly, this creates a team approach where the homeowner, contractor and architect are all working together for the same common goal.

Competitive Bidding

Competitive Bidding means an agreement on a lump sum payment. All considered contractors on your short list receive an identical set of plans from which they will formulate a price for the project. After reviewing the bids, the homeowner and architect must decipher the bids for completeness. This is an extremely important part of the process and often not given enough time to truly evaluate all factors. Much of the time the contract is awarded to the seemingly low bidder, but not the best qualified who has a more complete bid resulting in fewer future change orders. One of the main problems with competitive bidding occurs when incomplete plans are submitted by the architect. If the plans are incomplete or unclear, subcontractors bidding on the job will supply the contractor with inaccurate information. Leading to unforeseen costs and future change orders.

Cost Bid

A cost bid, is a bid in which the homeowner pays the cost of labor and materials- plus a fee based on a proposed budget. This is used most often when plans are still in the development stages. It allows the most flexibility during the course of your project to implement changes in design . It also allows for an earlier start date. Construction can start immediately. It creates great team effort and collaboration with all parties involved. A good way to go.

Final Decision

Whatever process you choose, it is very important that you trust and feel confident about your contractors capabilities and professionalism. This will insure that your working relationship develops with honest communication and will result in a job well done with as few complications as possible.