It’s that time again. Time to kickstart a new year of bidding and negotiating contracts.
Owners always wait until the beginning of the year to start construction projects.
The most effective, yet simple bidding strategy you can start using right now is to give the first 3 months of 2020 a hard bidding push.
Whatever you bid today, you’ll see the results in about 3 or 6 months.
Essentially, you are setting yourself up for success for most of this year by pumping out as many bids to qualified clients as possible. Don’t just randomly bid to strangers. You need to vet your clients and see who is worth investing in.
Here is an article I wrote titled “27 Ways to Get More Construction Jobs in 2020” where we show you a ton of strategies to get more projects and who to reach out to.
Here’s a quick explanation on why 3-6 months.
Why 3-6 Months?
Once a project is in the final stage of drawings, Architects and Owner Reps send out the project to bid. There is typically some time for the bids to come in which is around 1-2 months. Once initial numbers come in, to Ownership, there is often a period of negotiation and value engineering. This period can last another 1-2 months.
Sometimes project pricing comes in high and the Architect needs to redesign parts of the job and can take longer. This is where revisions and addendums come out. This is where most of the time is spent for us contractors waiting. You need to wait for the designers to finish making their changes. This can last a few months.
Lastly, there is usually another round of bidding and updating of prices. Another 2-3 weeks.
Finally! After several months, a contract is ready to be issued. But… the last hurdle is the financing. Most Owners will finance the project through a construction loan. This process can take 2-3 months for approval from the underwriting department.
Total timeframe: 3-6 months. And sometimes longer.
If you push hard at bidding in the first 3 months of 2020, you can set yourself all the way through maybe September. It’s a mistake to “wait to see what happens” on projects you already bid. If you happen to win a lot of projects, banks will be more than happy to issue you a credit line based on the contracts you have.