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#183738 - 01/21/09 02:47 AM how do I bid allowance  
watersparkfalls  Offline
Member
Joined: Mar 2005
Posts: 222
Washington...Not DC
I do not fully understand when they say give an allowance for X (say lighting).
Do I bid giving them upto that amount? And if they come under allowance do I subtract from final payment?

please advise.

Thanks,
H20


Business, Office, Estimating, Legal:

#183743 - 01/21/09 10:52 AM Re: how do I bid allowance [Re: watersparkfalls]  
ghost307  Offline
Member
Joined: May 2005
Posts: 917
Chicago Illinois USA
Whenever I write that in my "Issued for Bid" set with regards to the lighting, it usually means that the 'lighting designers' haven't finalized their vision yet, but we can't wait for them...we need to get this thing bid and awarded.

In order to keep things fair for the bidders, I give them a line item price for X. That way, it's possible to get a reasonable bid from everyone instead of a bunch of wildly differing assumptions about what X will finally turn out to be. It's a LOT easier than horsetrading later on for materials and labor when the Bid included 34 $200 lights but the final design called for 42 $160 lights.

If the final price of X is over the allowance, the Change Order is smiled upon with very few questions. If the final price of X is less, I usually let the unspent money go back to the Bidder.

Some folks may handle it differently; it would be safest to ask that before your bids are due.


Ghost307

#183760 - 01/21/09 08:37 PM Re: how do I bid allowance [Re: ghost307]  
maintenanceguy  Offline
Member
Joined: Dec 2001
Posts: 300
Southern NJ, USA
An allowance is the amount that your bid "allows" for an item that hasn't been chosen yet. You might allow $100 per lighting fixture if the fixtures aren't chosen yet.

Definitely keep your allowance items as separate line items. If you don't, you'll pick a more expensive fixture than the competition and your price will seem higher. Also spec exactly what fixture you've chosen for the allowance just to show that you aren't pricing something really cheap to make your bid look lower.



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