Winning construction bids in 2023 will be more competitive than ever. With costs increasing for materials and labor, contractors need to think carefully about how they price projects and market themselves.
Whether you’re an established firm or just starting out in the industry, understanding the ins and outs of construction bidding can give you a leg up over your competitors. Royaltakeoffs will share 15 tips on how to win more construction bids this year so that you can get ahead of the competition.
1. Bid First and Know Your Competition:
The most important factor in winning construction bids is to ensure that you get your bid in before the deadline. By bidding first, you have a better chance of getting ahead of your competition.
Make sure that you know who else is submitting bids and what their qualifications are so that you can make an informed decision. Additionally, researching market trends and industry changes will give you insight into how other bidders may price their services and offer discounts or incentives that could sway the favor in your direction.
2. Don’t Chase Every Job:
Set a minimum bid requirement for yourself and don’t waste time pursuing jobs that won’t provide you with the desired return on investment. It may be tempting to pursue every available opportunity, but this could lead to spreading your resources too thin or taking on jobs that aren’t profitable.
Instead, focus your efforts on bids that meet your requirements and have a higher likelihood of success. This strategy will help ensure better use of resources, greater profits, and more successful projects going forward.
3. Invest in Technology:
Adopting new technologies can help you gain an edge in the bidding process by streamlining operations and improving efficiency. Investing in modern construction project management software can help save time and money while giving you a distinct advantage over competitors.
4. Build Relationships With Customers:
It’s important to have strong relationships with contractors, project owners, and other stakeholders in order to increase your odds of being awarded future contracts. Building relationships takes time from networking events to engaging online but it is worth the effort as these connections can be key for upcoming bid opportunities.
Take the time to get to know people and become familiar with their businesses so that when it comes time for bidding, you are top-of-mind among potential clients.
5. Find Quality Construction Leads:
The most successful construction companies are those that build a high-quality network of potential customers. Investing in quality leads is key to winning more construction bids. Try reaching out to local businesses or industry contacts, attending networking events, and joining online forums to increase your visibility and target quality leads.
6. Call Everyone on Your List:
Reaching out to everyone on your list of potential customers is essential for winning more construction bids. Give them a call and introduce yourself and your business, explain what you do, and ask them if they have any upcoming projects that need work. Make sure to be friendly yet professional when reaching out so that you make a good impression.
One of the most important things you can do to win more construction bids in 2023 is to stay organized and be ready for follow-up. After submitting your bid, take note of when a response should arrive, and then make sure you’re following up if it doesn’t come on time.
It’s also important to stay organized in terms of keeping track of who you spoke with, what was discussed, and any information that has been requested from you or sent to you.
Being prepared for follow-up conversations will help ensure that your bid stands out amongst the competition. Furthermore, staying organized with notes and correspondence will setup you up for success the next time around when bidding on similar projects.
8. Recognize and Manage Risks:
Risk management is an integral part of the bidding process. As a contractor, it’s important to be aware of potential risks and have a plan in place to manage them if they arise. This includes being mindful of potential liabilities for safety violations or delays in project completion.
To help mitigate risks, consider putting together a contingency plan to address any issues that might arise during the course of the project. Additionally, review contracts carefully before signing and ask questions if anything isn’t clear.
9. Understanding Your Bid-Hit Ratio:
Your bid-hit ratio is an important metric to understand when it comes to construction bidding. It’s the percentage of bids you submit that result in your company being awarded the job. By understanding this ratio, you can better gauge how successful your bidding process is and identify potential areas of improvement to help increase your rate of success.
10. Write Detailed Proposals:
When it comes to winning construction bids, writing detailed proposals is key. Your proposal should accurately reflect the scope of work and any special considerations that your prospective client has noted. Make sure you include any cost-saving measures or unique solutions that your company can provide.
Doing this not only increases your chance of being awarded a bid but also ensures everyone involved is on the same page about what needs to be done and when. With a clear and well-thought-out proposal, clients will recognize your professionalism and likely give you the job!
11. Include All Material and Equipment Costs:
When submitting a construction bid, it is important to include all material and equipment costs. This includes not only the cost of supplies and tools necessary for the project but also any additional expenses associated with hiring subcontractors or renting specialized machinery.
By accurately estimating these costs ahead of time, contractors can ensure that they are bidding competitively and have enough funds to cover any unexpected expenses throughout the course of the project.
12. Subcontractors and Subcontractor Pricing:
Subcontractors are a useful resource for large-scale construction projects, as they can help take the workload off of your team. It is important to vet subcontractors carefully and make sure you trust them to complete their portion of the project on time and with quality workmanship.
When selecting subcontractors for pricing bids, look for those who have a proven track record of excellence in their field. Furthermore, it’s always wise to ask for references from past clients before entering into any formal agreement. Additionally, establish clear expectations up front regarding timelines and payment terms so that any issues down the road can be avoided.
12. Examine Your Prices:
Market prices are continually shifting. Recently, you can observe that because to COVID, as well as shortages and other factors such as lumber and steel pricing. Isn’t everything becoming better? You must continually scrutinize those figures.
Labor is also changing. If the economy is doing well, there will be more labor for which the peacekeepers and subs will want to demand more money. They want to charge less money if things are tight and there is no job available. Things are constantly changing.
13. Consider Objections As Opportunities:
Don’t be concerned if your prospect has questions or reservations during the bidding process. To better connect with them, try to grasp the underlying source of any issues they have.
Persistence is beneficial to the bidding process if approached correctly. Maintaining contact with potential clients and being consistent may aid in increasing your close rate. It might also be beneficial to highlight what a rival did well with their presentation, such as cost and timing.
14. Be Willing to Change Your Focus:
Finally, responding to changes in the business or economy might assist you in being competitive and resilient through difficult times.
For example, during the COVID-19 epidemic, home construction increased but commercial development decreased. Contractors who generally bid on commercial work saw an opportunity to shift their focus to areas with the highest demand.
15. Begin Small and Build Your Way Up:
For those just starting out in the construction business, it’s important to begin small and slowly build your reputation. Taking on too many projects right off the bat can be overwhelming, and cause you to miss deadlines or even worse, not deliver quality work. Start off by bidding for smaller-scale projects that you know you can handle with ease.
Once you’ve gained a good track record of successful jobs, then you can start taking on larger ones. In addition to helping hone your skills, completing these initial projects will also help strengthen your portfolio when submitting bids for more profitable contracts down the line.
Wrapping It Up:
The construction industry looks likely to have an uptick in 2023. With so much economic uncertainty facing the world today, it’s more important than ever to make sure you are well-prepared for bidding on and winning projects. Utilizing these essential 15 tips will help your company stay competitive in the coming year by giving you a leg up on other players in the industry.