Tips on Bid and Quotation Comparison

The key to obtaining professional bids and quotations is to provide the contractors with as much data as possible. The fuzzier your thoughts, plans and specifications, the more ambiguous your bids will be. In fact, the bids may be higher than they should be, because each contractor is trying to protect themselves from delays you may create while trying to make up your mind. This fact is often overlooked by many homeowners. Remember, contractors are not mind readers!

How many should I get?

I have been asked in the past to bid jobs against five to seven other contractors. In these instances, I refuse to prepare a quotation. Generally speaking, I have determined that a wide majority of these people are merely shopping for price. My suggestion to you is to try to find three contractors who are about the same size and who perform similar levels of quality. Getting prices from three similar individuals will give you an excellent range of pricing. Never, never obtain just one bid!

Exposing yourself

Never tell a contractor what you are prepared to spend on a project. If, by chance, you are dealing with a dishonest contractor, his/her price may be just under your ceiling. However, you may be asked by a contractor what you are willing to spend. I have done this in the past so as not to waste time in preparing an estimate. I have successfully overcome this dilemma. Experienced contractors can generally compute a square foot cost estimate quickly when looking at a job. Ask the contractors to do just that and present these prices to you. Each party realizes that these are tentative numbers. However, they allow you to determine if the project is out of reach early in the bidding process.

Itemized Quotations

Always demand an itemized quotation. These quotations are invaluable. They allow you to see just how each contractor arrived at his/her price. These quotations enable you and the contractors to determine if anything has been overlooked in the bidding process. This eliminates any financial surprises after a project begins.

Itemized quotations also enable you to set up a fair and equitable payment schedule with your contractor. Because you can see what each aspect of the job costs, you can be sure that you only pay for items which have been installed or are on site. This method will afford you great peace of mind.

Insurance Documentation

Be sure that your bids include copies of all insurance documentation. Professionals have readily available copies of their Worker's Compensation certificates and General Liability policies. Demand that copies of these be included in your bid envelope. Often low bids are low because insurance premiums are not really being paid. Remember, anybody can say that they are insured. Don't rely on hope. Get copies of these valuable certificates!