I am pricing a residential addition, with two contractors bidding it, and the owners requested sealed bids. I have never done that. Is that a common practice? What are the advantages?Thanks!
Thank you. I did Google the issue before posting. I was hoping for some feedback on small residential projects, as the Google search leads to info about big public jobs.
You usually come across sealed bids in public works projects. I believe it is a process that evolved out of the state and federal legal requirements surrounding public work similar to pre-screening contractors, bonding work, and generally being very formal (sealed bids due at midnight signed in blood). I guess the only benefit is that it prevents bid tampering by a 3rd party (maybe your owners don't trust you? ha!).
On a residential addition it seems overkill, you are only dealing with 2 generals bidding the job and depending on where you are, they are probably sourcing the same subs, so they will have identical numbers for various trades anyways.
Tell your owners to relax, it is just a residential addition.
The more unnecessary hoops they make the contractors jump through at the start (and sealed bids on a residential addition are unnecessary) the more expensive the bids are going to be. Residential contractors have told me that they absolutely charge a pain in the ass tax.
I've have about 10% of clients adamantly want this. Most of the time it is so that after they get the bids in they can try to negotiate the bid down further. It's easier to do that to contractor A, if contractor B doesn't know what the other bid was. Otherwise there is no real reason that the bidders should not get at least a summary of the bids. The owner can pick whoever they want. There is no obligation to select low bidder. At least one guy is going home without the work, after putting the time in to prepare their bid. They should at least be given the courtesy of knowing where they stood.
Jul 14, 14 9:22 pm ·
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Sealed bids
I am pricing a residential addition, with two contractors bidding it, and the owners requested sealed bids. I have never done that. Is that a common practice? What are the advantages?Thanks!
Try this link:
https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=sealed%20bids
Thank you. I did Google the issue before posting. I was hoping for some feedback on small residential projects, as the Google search leads to info about big public jobs.
You usually come across sealed bids in public works projects. I believe it is a process that evolved out of the state and federal legal requirements surrounding public work similar to pre-screening contractors, bonding work, and generally being very formal (sealed bids due at midnight signed in blood). I guess the only benefit is that it prevents bid tampering by a 3rd party (maybe your owners don't trust you? ha!).
On a residential addition it seems overkill, you are only dealing with 2 generals bidding the job and depending on where you are, they are probably sourcing the same subs, so they will have identical numbers for various trades anyways.
Tell your owners to relax, it is just a residential addition.
Thank you - very helpful! It might be a matter of trust, or just love for formality.
The more unnecessary hoops they make the contractors jump through at the start (and sealed bids on a residential addition are unnecessary) the more expensive the bids are going to be. Residential contractors have told me that they absolutely charge a pain in the ass tax.
I've have about 10% of clients adamantly want this. Most of the time it is so that after they get the bids in they can try to negotiate the bid down further. It's easier to do that to contractor A, if contractor B doesn't know what the other bid was. Otherwise there is no real reason that the bidders should not get at least a summary of the bids. The owner can pick whoever they want. There is no obligation to select low bidder. At least one guy is going home without the work, after putting the time in to prepare their bid. They should at least be given the courtesy of knowing where they stood.
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