How Do You Bid on a Job?
If you're a freelancer or contractor, you'll most likely have to bid on a project at some point. Knowing how to bid on the right projects is vital to the success of your small business. But time is money, and you can't afford to waste it. How do you make a professional bid, and how do you know what projects to bid on?
The purpose of this guide is to answer questions like these. We'll talk about why bidding occurs, what bidding opportunities you should jump on, and how to create quality bids. We'll also go over how the process can be different depending on your industry.
The bidding process can be time-consuming. Skynova's bid template makes it as quick and easy as filling in the blanks.
What Is a Job Bid?
A bid is a document stating how much a business or contractor will charge for completing a project. When a company needs a project done, they'll send out a request for proposals (RFP) or a request for quotation (RFQ) to several businesses or contractors who might be able to complete the work. If a contractor is interested in the job, they'll respond to bid opportunities by drafting proposals and sending them to the company for consideration.
After reading each bid, the company decides who they want to do the work. All types of companies request bids, from nonprofits and big corporations to government organizations. Bids help them hire the best team to meet their needs at the best price.
Bid documents are used by trade workers, like electricians, writers, artists, software developers, and other types of contractors.
How Do I Make a Bid Proposal?
In this article, we'll give you easy-to-follow steps for creating winning bids that will give you the best chance of procurement. To land the best jobs, you need to present yourself as the potential client's or customer's best option. That means you need to show your expertise while offering the best price you can.
Review and Analyze the RFP
Before you even start to make a competitive bid, you have to decide if you want the project. There's no point in doing paperwork if a job isn't right for your business. It's ultimately your call if you find a job interesting enough to bid on. When you're making a decision, there are a few things you should think about.
Do you have the right qualifications? Just because a job is in your industry doesn't mean it's the best fit. For example, if you're a technology blog writer, but the job asks for a financial blog writer, you might want to let another contractor have it. It's up to you if you want to stretch your limits, but jobs outside your comfort zone can require more effort and may have hidden costs. For example, extra construction costs for things like a kitchen renovation can be huge.
Are you familiar with the hiring company? If you have insider knowledge or a connection to someone working inside the business, you should strongly consider making a bid. Maybe you've done private work for an executive, and now they've recommended you for a company project. If this is the case, you might have a better chance of getting the job.
Are there any drawbacks to taking the job? You might not be happy if a job requires a two-hour commute back and forth every day. Some jobs may need materials that aren't easy to attain. For example, the COVID-19 pandemic made it difficult for roofing contractors to get collated nails from China. There might even be safety concerns if you're construction bidding, like working in extreme heat, that could influence your decision.
Discuss the Project With the Customer
Set up a meeting with the customer to discuss the nature of the project and make it as brief as possible. If you can't meet in person, a phone call is fine. Write down any questions that you have beforehand so that you don't waste anyone's time. Some things you might want to ask include:
- Why did you ask me to make a bid?
- Did you ask any other companies to submit a bid?
- What are the project timeline and deadlines?
The answers will help solidify whether your company is right for the job and tell you if you have a realistic shot of getting it. If you realize the job isn't for you during the meeting, let the business know why. They'll remember your honesty when they have work better suited for you.
Why Did You Ask Me to Submit a Bid?
Did the company get your name from a reference? A positive review from a trusted source can give you a leg up over the competition. Has the customer seen your past work? If so, they might have already decided you'd be a great fit for their project plans.
Did You Ask Any Other Companies to Submit a Bid?
If the company sent out 100 RFPs to businesses that they found on a social media site like LinkedIn, your odds aren't great. But if the company sent out five RFPs to businesses they really researched, you've got a better chance. When it comes to finding contractors, some companies cast a broad net. It's your call how much competition you want to deal with.
What Are the Project Timeline and Deadlines?
Is it even possible to finish the project by the deadline? Let the interviewer know your thoughts. They don't have expertise in your field and may have an unrealistic timeline. If they don't listen to reason, let the job go. You don't need the stress of working with an overly demanding customer.
You should also take into account your schedule. Does the project fit with your other gigs? Will the time commitment keep you from taking on other jobs that could be more profitable? If the scope of work is too large for you to handle at the moment, you probably shouldn't take the job.
Use a Bid Template
Creating your own bids can be time-consuming and confusing. That's why it's a good idea to use a bid template that lays everything out for you. Skynova offers a professional-looking bid template that can make the process simple and accurate.
Not only is the template free, like all of Skynova's business templates, but it's also fully downloadable and printable. You can also save it as a PDF or send it directly to the customer from the website. If you've made your own bids before, you know what a hassle it can be. Save time and effort by using a template.
Determine and Include Costs
The whole point of taking projects is to make money. You need to know how much you can charge for your services and still make a profit. To do this, you'll have to make an inventory of all the costs for a particular project. Be sure to keep in mind things like:
- Any materials you'll need
- Subcontractors you might have to hire (contract workers who complete smaller parts of your project)
- Travel and related costs (gas, vehicle wear and tear, hotels, etc.)
- Any other unique expenses
After you've calculated your costs and included them in your bid, it's time to think about your profit margin. The great thing about self-employment, as opposed to full-time employment, is that you have control over your pricing. However, there are some standard markups for certain industries.
For example, general contractors in the United States usually charge a markup of around 10% to 20% in their construction bids and charge as high as 25% for a big construction project. Getting new projects isn't always about making the lowest bid; you need to make money.
Submit the Bid Proposal
When you submit your bid package, request a follow-up meeting with the potential customer to go over your terms. Explain the numbers in your bid and ask if they have any questions about your charges or services. Let your bid speak for itself. Trying to oversell yourself before a customer has had a chance to look at other bids can hurt your chances.
Skynova's bid template lets you store your bid on the cloud. The customer can even read and accept it online. And you'll be notified when they do. Whether you're trying to land government contracts or small construction jobs, our software's functionality will help you reach your goals. With our bidding and estimating software, you don't have to spend valuable time waiting for customers to open their email and send a bid back and forth.
Use Skynova's Software to Help Manage Your Estimates
As a contractor or freelancer, you want to be strategic about bidding for projects. By creating a great bid, you have a better chance of securing jobs beneficial to your company.
Knowing when and how to respond to an RFP will help you build quality, respectful relationships with customers and do the jobs you're best suited for. Mastery over the bid process is a vital skill that every contractor should have.
If you're drowning in paperwork, Skynova can help. We have software products that will help you with things like accounting and creating invoices. Let us take some of the stress out of running your own business. You didn't start it to do administration.