"Green is for the money, gold is for the honey"

In the high-stakes world of construction bidding, every decision counts.

Let’s say you're knee-deep in a bid, your estimator has meticulously laid out the costs, and your team has quickly settled on the price.

Conventional productivity wisdom may indicate that you are doing it right. I believe this is wrong. Here's why:

There should be two separate discussions: one for cost (estimating) and one for pricing strategy (bidding). Why have multiple meetings when you can get it all done at once? As a hater of unnecessary meetings, it pains me to write this. Combining cost review and pricing strategy leads to a rushed process and conflation of cost and profit. They are not the same! Here’s a smarter approach and why two separate meetings matter:

Cost Assessment Meeting (Estimate Assessment):

• The estimator compiles project details and costs.
• The team agrees on costs - this step is vital.

Pricing Strategy Meeting (Post-Cost Assessment):

• Project desirability: Analyze risks and potential rewards.
• Resource alignment: Consider backlog and capacities.
• Competitive landscape: Assess the competition's hunger.
• Historical insights: Learn from past profitability, bid spread, and bid tab data.
• Market dynamics: Anticipate upcoming bids.
• Team input: Discuss market margin expectations.

The Payoff:

• Precision: Separating cost from pricing enhances accuracy.
• Strategic Advantage: Empower your team to evaluate bids well in advance, so you are never late on a bid.

By building a barrier between cost and profit in having two dedicated meetings, you'll navigate bidding with a sharper focus on what truly matters: maximizing profitability.

Thanks for reading our post!

At Edgevanta, our proprietary SaaS software platform helps contractors win more of the work they want at the right price with the least amount of hassle.

Sincerely,

Tristan Wilson

Co-Founder and CEO

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