HOW TO SUCCEED AT BIDDING & ESTIMATING
“ Lump sum is what you ’ re going to see the majority of the time ,” said Lowery . “ There will be no change orders unless the owner or design team will make changes . If you try to lowball on the lump sum , that is a risk that you are taking ; don ’ t come back to the owner and ask for more money .”
— Robert Lowery , Field Support Project Executive for Merriwether & Williams , a HUB International Company
Lowery pointed out that there are two types of project delivery methods : design-bid and design-bid-build . Design-bid is a form of project delivery that involves the owner or agency contracting one entity for design and construction , whereas design-bid-build is a method of project delivery that involves the owner or agency contracting separate entities for design and construction .
“ With design-bid , the plans are conceptual ,” said Lowery . “ The reason is that the owners are trying to shift the risk to the general contractor in your team . It also speeds up the timeline for the project and you are taking more risk and controlling the duration of the project .”
With design-bid-build , the owner takes on the risk , it takes longer for them to get the plans out , funds appropriation takes longer , and if there is an error , it is on the owner ’ s design team , noted Lowery .
As far as types of proposals are concerned , the most common type is an Invitation for Bid ( IFB ), said Lowery . This is what contractors will encounter with public works and government proposals . This competitive method of awarding government contracts is used for procurements of more than $ 100,000 , and the agency knows exactly what and how much of everything it needs in the contract , as well as when and how the products and services are to be delivered .
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