Tips to Improve Your Construction Bids

The accuracy of your bid is crucial to not only winning the job but also determining expected costs and forecasting your profitability. The bid includes the quantities and prices collected in the takeoff and the estimate so precise information is necessary from the start.

Collecting and organizing this data can be time-consuming and difficult. To make your job easier, we’ve outlined some tips to help you build better bids to win jobs and maximize your profits.

1. Review Project Guidelines

The ultimate success of a bid hinges on knowing exactly what the project owner is expecting before creating your proposal. A few things to keep in mind are:

• Price: In some situations, an owner may have a specific price in mind, and it’s important to make sure you can deliver the project within their budget while still maintaining your desired profit margin.
• Materials: The type of materials the owner wants on the job, your ability to source them and the cost of them are crucial considerations when building a winning bid.
• Timeline: Review your project workload to determine if you can complete this project within the owner’s expected timeline.

Understanding these requirements will help you and your team decide if this opportunity is right for you. If it is, you can use the knowledge you’ve gathered to shape your takeoff and estimate and meaningfully justify costs within your bid.

2. Use Construction Estimating Software for Fast, Accurate Bidding

Construction estimating software, sometimes referred to as construction bidding software, automates calculations to provide pinpoint accuracy when creating your estimates. Some construction estimating software also offers support for digital, on-screen takeoff, meaning you can upload your project blueprint and draw exact point-to-point measurements to determine the exact amount of material needed.

Some estimating software — like McCormick — can also track change orders and automatically update your estimating information to accurately represent these adjustments.

3. Research Trade-Specific Suppliers

Trade-specific suppliers have the widest selection of materials tailored to the job you’re bidding. You can easily determine the quality of materials the supplier is offering and compare it to the quality and pricing offered by other trade-specific suppliers. Additionally, a trade-specific supplier is better equipped to answer your questions about the materials to help you make the best choice.

4. Keep Estimates and Takeoff in a Centralized Location

One of the largest challenges of building winning bids is maintaining accurate records and a large aspect of that involves having access to the most recent version of an estimate. One common way to ensure you’re accessing the right information is by storing it in one digital location, like in a construction estimating software. You can also update your information throughout the bidding process and easily access the most up-to-date version of your bid within a digital dashboard.

5. Reevaluate Your Bidding Process

You should always be looking for ways to improve your bids to gain a competitive advantage. It’s crucial that you review past won and lost bids, evaluate your current material suppliers and research construction estimating software to help you determine areas of improvement. Once you’ve done that, you’ll be well on your way to the path to better construction bidding.

And if you’re ready to enhance your bidding capabilities, check out McCormick! The nation’s leader in estimating and digital takeoff software for MEP contractors.

---

Frequently Asked Questions About Construction Bids

How Does Overhead Factor in a Construction Bid?

Direct project costs like materials and labor are only part of a successful estimate. You must also account for fixed operating expenses to protect overall project profitability.

Overhead costs like office rent, software subscriptions, insurance and administrative salaries are allocated across active bids as a percentage or hourly markup.

Covering these indirect costs in your estimate ensures each job pays its share of business operations before target profit is calculated.

What Is the Difference Between a Takeoff and an Estimate?

A takeoff quantifies the physical materials shown on blueprinted plans.

An estimate calculates the total financial cost to complete the project based on those quantities.

Takeoffs measure raw counts, linear feet and surface areas. Estimates take those physical quantities and apply real-time material pricing, labor rates, equipment rentals and overhead markup to establish the final bid price.

How Can Contractors Avoid Underbidding on Complex Projects?

Underbidding usually happens when estimators miss hidden scope details or rely on outdated supplier costs.

Contractors can prevent missed costs by:

• Building standardized bid checklists
• Getting live pricing from trade suppliers

Adding a contingency line item — a set budget percentage reserved for unexpected site conditions or volatile material costs — also safeguards your profit margin against sudden price changes.

What Documents Are Required When Submitting a Formal Construction Bid?

A complete bid package requires more than a single total price figure. Most project owners and prime contractors expect supporting documentation to verify your team’s capacity.

Standard bid submissions include:

• A detailed scope of work
• Itemized cost breakdowns
• Preliminary project schedules
• Proof of insurance or bonding

Subcontractors may also need to provide key staff credentials and supplier quote verifications.

How Long Does It Take to Prepare an Accurate Construction Bid?

Preparation time depends on project scale, plan complexity and the estimating tools your team uses.

Manual paper takeoffs for commercial builds can take several days or even weeks. Using digital takeoff software and pre-loaded price databases reduces that timeframe to a few hours while eliminating human calculation errors.