ECN Forum

contracts for bid

Posted By: rws

contracts for bid - 12/06/06 09:58 PM

I'm new here.

And freshly out of a job. I was master of record for the company I was at (the pres only has a journeyman license previously, but had a contractor license based on my master number). He has made changes that run counter to what my state license requires of me. To the point, he promoted a junior license into a position that would have made this other guy my supervisor. How would that affect my signature on TDLR compliance for license upgrades, NEC code compliance, etc., as long as I was master of record? Well, he solved the problem by detaching my license from the company and, in so many words, there is no other place for me other than his general run-about guy.

So, basically, I'm trying to start my own company and he is trying to help me. (One can't hold grudges in business.) All in the same day, I lost my job, got a service call, and received from my former employer, a bonus that would pay the down payment on the required liability insurance.

And he's willing to give me small jobs on T & M invoicing. Easy enough.

I've been doing a lot of reading in a short amount of time to catch up on the finer points of estimating. Small jobs are easy, needed labor units to consider anything bigger than 500 feet of pipe, you get the drift.

I'm collecting quotes on insurance through one agent (his standard procedure) for just myself as one employee. I don't have the capital funds to go for jobs so big that you have to pay $200 for prints and submit a 5% bid bond with your package, as well as having any kind of finances to qualify for a first-timer's performance bond.

The hard part, is finding the small jobs. Retail lease spaces no bigger than about 4,000 sq ft or getting into the residential market with a solid builder.

I started doing electrical work in 1983 but most of my time has been spent doing the actual work, regardless of circumstances or weather. The last of the hard-core rough neck crazy sons of guns that will dig a ditch in the rain. I've never had much chance to hob-knob with the power set through which one becomes a preferred contractor or secures intial capital financing.

So, I'm looking for ideas and tips as to how to even approach or look up builders or find contracts for bid. Not all are as easy to find as Pogue Construction, which has a website with projects for bid. Otherwise, I'm going to end up working for someone else again, under some journeyman 10 to 15 years my junior.
Posted By: rabbitgun

Re: contracts for bid - 12/06/06 10:29 PM

Do you have "Blue Book" available in your area? I average 10 to 15 jobs a day to bid via email with them. There are also a couple of other on-line services available where I am.
Posted By: ITO

Re: contracts for bid - 12/06/06 10:50 PM

This site is great for getting leads and you can view the plans on line:

Also check out AGC in your area, they may have a plan room you can visit for a modest fee.

Another approach is to hit the jobsites, strip centers and such that are building out retail jobs. Put your cards out and see if you can find some work that way. A lot of time they are done by out of town contractors that don’t know anyone and are just looking for someone to do the job. They should furnish the plans for take-off at NO COST TO YOU. The 5% bid bonds are mostly for government work, so they don’t really apply to the size retail jobs you are targeting.

The only “gotcha” is you will have to provide workman’s comp and liability insurance to do this kind of work, and if they if think you are having financial problems they will delay payment on purpose, the idea is you go out of business they don’t have to pay you. If it’s a 10-15K job a lot of the time you can ask for 50% up front too, if you need it.

Look out for this language in the contract:

“Completed operations endorsement CG 2010 & CG 2057 Requirement”

It will ADD $500 to your insurance if required.

If you want a copy of my standard bidding scope, I can post one. It covers a lot of the “gotchas”.

BTW if you aren’t willing to dig a ditch in the rain then you don’t have what it takes to make in this business.

[This message has been edited by ITO (edited 12-06-2006).]
Posted By: rws

Re: contracts for bid - 12/07/06 12:42 AM

Thanks, guys.

I've learned some of the business over the years and even have contacts in high places but that's not the same thing as getting a foot in the door and knowing where and when to show up. Even some of those contacts don't always pan out. A friend knows an important architect and even that doesn't guarantee steady work.

As for digging a ditch, I think I'll get to stop that about the time, I retire. Even then, probably not. My wife likes to garden.

Ito, is that list the one you posted in another thread? Including what it costs to provide prints to tech subs that may be pulling your voice/data?

Rabbit, I think blue book is a page I've been linked to through looking at Pogue. Their jobs are too big for me, right now, but I wanted a look at what's out there. I do know that medium builders like them will have their own insurance requirements exceeding the state. The company I was working for has a few schools going on and the required coverage exceeds $2 M. Of course, those are 80,000 sq ft and up, min 3,000 amp service, 1 year warranty, etc.

[This message has been edited by rws (edited 12-06-2006).]
Posted By: ITO

Re: contracts for bid - 12/07/06 01:57 AM

That other thread was just me whining.

Make the GC hire the tech subs for now.
Posted By: renosteinke

Re: contracts for bid - 12/07/06 02:08 AM

Your is a pretty broad question....

Fro you, and others with the same questions, why not drop in the ECN "chat room" one night? While Wednesday is "business nitght," most any night will find some folks happy to talk about the trade!
Posted By: REW

Re: contracts for bid - 12/07/06 11:04 AM

The quickest way to get jobs to bid on is to find a copy of the Blue Book either call them or go online. Then find contractors in your area, call them and ask to be put on their "bid list". You will fill out a page of information about your company, and the size jobs you are interested in. Soon enough you will be flooded with Invitations to Bid. You will now work feverishly to complete so many take-offs and submit bids that your wife and kids may not recogize you when you actually cross paths.

If someone can tell me how to post a Word document here, I can give you a Proposal template. It's a (extensively) modified Mike Holt Proposal template.
Posted By: rws

Re: contracts for bid - 12/07/06 11:13 AM

I'll have to try that chat, sometime.

I really do appreciate the help I'm getting here.
Posted By: rabbitgun

Re: contracts for bid - 12/07/06 02:53 PM

Don't really know how much you have looked in to the blue book. Like others have mentioned I am inundated with bid invitations from contractors there on jobs of all sizes.
Posted By: rws

Re: contracts for bid - 12/07/06 04:07 PM

That's the one.

I don't know if I can set up an account as my business name is not officially registered anywhere.
Posted By: Jps1006

Re: contracts for bid - 12/07/06 05:13 PM

Don't really know how much you have looked in to the blue book. Like others have mentioned I am inundated with bid invitations from contractors there on jobs of all sizes.

Have you found those to be good leads? It has always been my impression that a bulk of those leads are price shoppers. You do the time to get a good price and they thanklessly use it to beat down the guy who they were planning on using all along.

Quite honestly, I'd love to hear some success stories about landing jobs from cold leads like those. All of my good work has always come from a reference. I've gotten some good service call work out of a listing in the yellow pages.... That's not an ad, just the one-line listing I get with my premium commercial phone line, which was my only option because I am renting a small office from my uncle in a commercially zoned building. That's an occasional call here and there; trust me the phone isn't ringing off the hook. All other work is referral. But that takes time in business to work up to.

I've put together plenty of bids from Blue Book leads, and I became convinced the lack of a relationship with the contractors meant my likelihood of getting the job was extremely low. I never got one. If I had gotten it, I probably would have been lower than I really wanted to be.

I guess it could be similar to fidelity in a marriage. You want a GC that can appreciate what you bring to the table (provided you do). You want someone who trusts your competence, your ethic and your price and realizes the value of having a good sub relationship. I like to avoid the GC who will cheat for the next good-looking price that walks by.
Posted By: rabbitgun

Re: contracts for bid - 12/07/06 06:09 PM

We had a local company that was like a bluebook company and distributed bid invitations and plans. They went out of biz and now we are dealing with isqft.........
It has been days of frustration trying to figure out their apparently new software system and Onscreen Takeoff.

Most of my project leads come from companies who I have built relationships with. No doubt about that but I am always looking for new companies to chase and open invitation bids are a good way to get there. Lets say I take the time to bid something and even run out a number that I know is high. I now have a name of an estimator and/or project manager at XYZ construction and I have something to call them about..... The project and my bid to them. We now have something in common. That can lead to me getting my foot in the door. After a few bids I can then say something like; "Hey, you know I have bid a few things to you and talked to you on the phone a few times but we have never met. How about I take you guy's out for lunch one of these day's."

My point is; It's a whole lot easier and more comfortable to use that kind of a stratagy to win the confidence of a G.C. that way than it is to stop by their office and drop off a couple of cards and a flyer.
Cold calls are one of the toughest things to do IMO.

Online bid invitations are here and here to stay. It is just much easier and cheaper to put documents out there and put the cost of printing or managing those documents on the subs. Rather than running off a bunch of copies for distribution.
Posted By: rws

Re: contracts for bid - 12/07/06 07:22 PM

I've been finding out that some retail developement in my county is a situation where GCs or developers took bids from anyone interested and then used the prices to hammer their preferred contractors. "Here's what this company bid, can you match that?" The preferred guy may be finishing a job and wanting to keep some money flowing will take it, even if it knocks his margin down a point or two. In fact, a lot of companies are doing good if they can make 10 percent. Some slim pickins but a job beats no job.
Posted By: rws

Re: contracts for bid - 12/07/06 07:34 PM

JPS1006 wrote:

about landing jobs from cold leads like those. All of my good work has always come from a reference

I want to build on references and "networking", as well. As you noted, people perusing a website may only be concerned with low bid, since they have nothing else to judge you by, not knowing you from Adam.

I've done a bit of work on Pogue projects, which is why I keep mentioning them. For example, they get the lion's share of school projects in this area. They are number one with many of the outlying school districts. And they are wrench-tight with SHW, a design, architecture, and engineering management firm. So, they pretty much get their pick of the work and, though they do bring on new subs once in a while, it's usually based on a previous relationship. In the case of my former employer, he had been proj. supt. and gen. supt working on a number of Pogue projects. When he started his own company, he was competitive in the bid but also referenced by the previous years of working together. And I can't blame them. With a millions of dollars at stake, you want the winning horse.
Posted By: LK

Re: contracts for bid - 12/07/06 07:44 PM

"a job beats no job."

That is true if your working for someone, when your in business you have to meet your cost of doing business, and make a profit in order to continue with the business, if you accept jobs within a narrow margin of profit, for any length of time, there will be no business, and what if an un expected cost comes up, or a time delay, how will you adjust to that, a good GC will want strong subs, in good finincal condition, it is to his advantage and his clients, for everyone on the job to be in good finincial health.
Posted By: rws

Re: contracts for bid - 12/08/06 03:39 PM

if you accept jobs within a narrow margin of profit, for any length of time, there will be no business, and what if an un expected cost comes up, or a time delay, how will you adjust to that, a good GC will want strong subs, in good finincal condition

I agree. My former employer bids kind of slim, in order to get the work, with the hopes of getting a fatter margin, later. Even though this wasn't our disagreement and I never debated him on his estimating, I feel that if you bid the margin that makes your company solvent and provide value for what you charge, your reputation will help garner business, later. It does no good if you low-ball, get the contract, then can't afford to finish it. And I'm not saying we would have to charge for a small change order of moving a plug, or even adding one during rough-in. I could give away a couple as a good will gesture, especially if I'm making the margin that is comfortable. But if, as we're installing lights and someone wants a change the requires re-piping say 300 feet of pipe, I would have to charge for that. One of the GC supts I have dealt with brags about talking small contractors down from their original estimate, not because he really thinks they are over-charging but because he thinks it makes him look good to everyone else.

I worked with him last December when my employer was first starting. I was a W-9, sole proprietorship for the labor and did much of the work myself. And this GC Supt. was telling me I ought to make a little less an hour, to "help out others and help secure more jobs". I politely let him finish his spiel and changed the subject when convenient. According to my former employer, I ticked this guy off, even though I was polite and even-mannered with him, even as he would fly into emotional fits of rage.

Well, I can be polite but I don't "kiss butt". The best I can do is keep quiet. People will hire you if you are professional and worth what they pay you, though the "bottom line" has a big influence, too.
Posted By: ITO

Re: contracts for bid - 12/08/06 04:58 PM

Reputation and Commercial Work.

Yes reputation is important, but it does not go as far as you would like it to go. The problem is the staff that quotes jobs for a GC is not always the same staff that runs the jobs; there are Estimators/Salesmen and there are Project Managers/Superintendents and for some reason they don’t talk to each other.

With some contractors, it does not matter what kind of dog a subcontractor may be, if he has low bid on bid day, he gets used. Then after the GC gets the job, his number is shopped around and if a better contractor won’t take it for his number, then he gets the contract. I have seen this over and over, there are no loyalties on bid day, and everyone forgets your reputation long enough to get the lowest price.

Where your reputation comes into play is with negotiated jobs, and design builds, which are some of the best jobs you can get.
Posted By: Jps1006

Re: contracts for bid - 12/08/06 07:10 PM


I know I've read the term Negotiated work before and knew in context what it was, but can you refresh me on what type of arrangement that is?
Posted By: rws

Re: contracts for bid - 12/08/06 07:33 PM

Negotiated Work is when an owner doesn't want open bid and trusts the judgement of a GC who may shop the project around to two or three of his preferred subs. Negotiation enters into it in how alternates are priced and how each sub can deliver a finished product by their various means. This is a lot of work for the sub, providing total estimate and also providing everything as an alternate with unit pricing or totals for each alternate, such as, roughing in with pipe and wire as opposed to MC and also various phases, such as Phase A, Phase B. I've heard them called give backs. The owner decides they want some one else for another phase or decides they want the cheaper alternate on lighting. Sometimes, this can make the contract rather fluid. It's kind of tough receiving $50k to start and then have to give back $10k because they've deleted a few classrooms in a wing, or some such.

A sub can take a beating, though GC didn't feel a thing.
Posted By: sparky 134

Re: contracts for bid - 12/09/06 02:01 AM

I bid a cafe remodel in a Sam's Club. The GC called me to 'talk' about my price. He said I was higher than his budget could allow. He then asked if I brought the job in under the amount of hours I had estimated could I give him a refund for some of the 'unused' hours. I asked, "If I underestimated the amount of hours needed can I bill you more at the end ?"

He said, "Yeah, that's what you all say."
Posted By: rws

Re: contracts for bid - 12/09/06 01:18 PM

Ito has a good point. My former employer and I worked together at a previous co. where he was gen supt. Then, he started his own co., with me as his MOR. Even though the GC knew him well, he was awarded contracts because his bids were competitive and low.

And one contract was constructed of several "give backs" or alternates. The give back is a loss as far as future income goes, but would not reflect on what he would receive for work done. But that's still a tough situation if a phase runs close to or over budget. The next phase you were counting on might have been given back and now you won't have that cash flow in a month, unless you're willing to match a lower bid on the next alternate. Or, they simply want to delete a particular item and there's no negotiation about it.

But my former employer is fast becoming one of the preferred subs because A) by his own admission, he excels at butt-kissing and BS and will bid low, and B) he has knowledgable, talented people who accomplish the work.

But he is scaling back to 2, maybe 3 schools a year to reduce his management workload, which means he will probably bring his margin up at least a point.

Even as I'm trying to start a business without a steady flow of work, I have an app in at another company as I've got to have some way of putting food on the table. I have enough money to pay bills for one month, and that's a result of working for this guy at less than what I should be making and having stretches of not enough work.

On the upside, I ran into an old workmate/friend who, also a master electrican, works for another big GC and he wouldn't mind helping me when possible. So, contacts are good and they are even better when you get that little piece of paper that says "pay to the order of."
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