For general contractors & builders
Winning More Bids Without Being the Cheapest
The low number does not win the job as often as you think, and when it does it usually wins you the worst jobs. Here is how to write a proposal that lets a buyer pick you at a fair price, scope so the money holds, and get paid without chasing it.
Most contractors treat the bid like an auction. Sharpen the pencil, shave the number, hope you land under the next guy. It works often enough to feel safe and it quietly wrecks you, because the jobs you win on price are the ones with the thinnest room for anything to go wrong. A slow-pay owner, a fuzzy scope, a change nobody wrote down, and the margin is gone. The good news is that price is rarely the only thing a buyer weighs. They are also guessing at risk. A proposal that answers that lets a buyer choose you at a number that actually pays.
Source: CFMA 2024 benchmarking data, via Autodesk and Foundation Software.
Lead with the outcome, not the line items
The first thing a buyer should read is what they get and why it will go smoothly, not a wall of quantities. Name the result in plain words. Then the numbers land as proof instead of a menu to haggle over.
Give three options, not one take-it-or-leave-it price
A good, better, best layout moves the conversation from should I hire you to which version do I want. It also anchors your real bid in the middle, so the cheap version makes the fair one look reasonable.
Write scope as what is included and what is not
Most disputes start in the gap between what you meant and what they assumed. A short exclusions list covering permits, patching, haul-off, and unforeseen conditions prevents the free work that eats a job alive.
Price the risk you can see
If the drawings are thin or the site is a question mark, say so and carry an allowance for it. Buyers respect a number with an honest contingency more than a lowball that turns into a fight later.
Make change orders a system, not a confrontation
Changes are normal. On major jobs they run around 10% of contract value and sometimes past 25%. Agree up front how they get priced, signed, and billed, so a change is a form to fill out, not an argument to have.
Stop giving away out-of-scope work to keep the peace
The quiet margin killer is the yes, no problem to things that were never in the deal. Track them. A signed change for a small add teaches the client that scope has a price, which protects the big ones.
Document everything the day it happens
Dated photos, field notes, and a quick email confirming a verbal decision are what turn a he-said dispute into a paid change. Same-day beats perfect. Memory fades and so does your leverage.
Bill on a schedule, not on a whim
Progress billing tied to milestones keeps cash coming in instead of stacking up until the end. Owners plan around invoices they expect. A surprise invoice sits in a pile.
Set payment terms before you set the first nail
Deposit, draw schedule, retainage, and what late costs. Put it in the contract and say it out loud. The average contractor waits 83 days to get paid, and most of that gap is terms nobody nailed down.
Know your real overhead before you quote
You cannot win at a fair margin if you do not know what fair is. Load your true cost, trucks, insurance, office time, slow-pay drag, into the number. The industry nets about 6.3%. If you are guessing, you are probably giving margin away.
Chase the receivable like it is part of the job
A friendly reminder the day an invoice is due is not rude, it is professional. The crews that get paid fastest are the ones who follow up first and every time, not the ones who wait and hope.
Make it easy to pay you
Every extra step between the invoice and the payment is another day of float. Take cards and bank transfers, send a link, let a draw clear the same afternoon. SimblPay sets this up so the money moves the moment the client is ready, instead of waiting on a check in the mail.
Net profit as a share of revenue. Most contractors sit at the low end, and the difference is almost never price. It is scope discipline and getting paid on time.
You do not win better jobs by being cheaper. You win them by being the bid the buyer trusts to finish clean and bill straight.
Do this today
Tighten one proposal before you send it
| Add an exclusions list | Three lines of what is not included. Permits, unforeseen conditions, anything you have eaten for free before. |
|---|---|
| Break the price into three options | Good, better, best. Put the version you actually want in the middle. |
| Write the change-order rule in one sentence | How a change gets priced and signed before work starts. Paste it into every proposal from now on. |
| Set the draw schedule | Deposit plus milestone payments plus retainage terms. Name the dates, not just percentages. |
| State what late costs | One line on your terms and the fee for going past them. Clients pay the invoices with teeth first. |
If you only do one, do the exclusions list. It stops the most common way a fair bid turns into a loss.
Racing to the bottom feels like hustle, but it hands you the jobs with the least room and the slowest checks. The contractors who build something that lasts are the clearest, not the cheapest. Their scope is tight, their changes are written down, and their money shows up on schedule because they set it up that way. Pick one proposal this week and tighten it.
Sources
- CFMA 2024 Construction Benchmarking (industry net margin ~6.3%), foundationsoft.com
- Autodesk Construction, average profit margin by segment, autodesk.com
- Rhumbix, change orders as ~10% of contract value, rhumbix.com
- Construction DSO ~83 days benchmark, ccfgcredit.com
- ConstructConnect, bid-hit ratios for commercial GCs, constructconnect.com