Given the resources invested in bidding on a construction project, your skill at choosing projects to pursue is a major factor in your success. A few simple techniques can help you identify and win the projects that will profit you most.
Watch Your Labor Investment
Bidding on a construction project is always a commitment of time and money, but it’s important to be alert for signs that a proposal process isn’t worth the effort. Watch out for highly labor-intensive proposals that require your technical staff to work out complex details specific to the project, such as LEED scorecards. If your marketing department can’t handle a proposal alone, you may be putting in too much effort.
Keep in mind the work you’ve put into the details doesn’t always go toward the finished project. Even if the client accepts your proposal, they may require changes.
When deciding whether or not to pursue a project like this, consider the potential opportunity costs. Tying up too many of your resources in one complex proposal can leave you unable to go after more profitable projects.
Consider PPP Projects Carefully
Public-private-partnerships, also known as PPP or P3, may appear lucrative, but the cost to pursue them is often excessive. Much of the cost comes from the need to hire an outside adviser who can conduct your due diligence in terms of legal issues. P3 projects are also rife with political intricacies that can complicate contract negotiations and cause delays. In addition, developing P3 estimates requires more documentation, such as the Operation and Maintenance Scope of Work documents.
The results of your go-no-go process shouldn’t be carved in stone. Stay open to new information about the client and the project, and update your go-no-go process documentation accordingly. You may find the client is difficult to work with, or that you’re bidding against an exceptionally strong competitor. That said, after you’ve finalized your go-no-go decision, it’s rarely beneficial to make major changes to your proposal.
For more tips on bidding on a construction project, contact us at Construction Monitor.