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Bid Leveling: What is it? Is it important?

The bidding process is hectic for clients as they must be on the lookout to ensure that they are not paying a surplus beyond their needs.

For the bidders, the bidding process sometimes feels one-sided. They submit their bids but never hear back as their offers disappear into the hands of project managers. Many contractors and subcontractors then wonder what they ought to do to level their bids.

This article will discuss the process of bid leveling and its benefits in construction.

What is bid leveling?

Bid leveling is the process of ensuring all project bidders present their bids in an even bid package. Leveling takes the responses and organizes them in such a way that clients easily understand. The discrepancies in the bids are also identified, and each firm's experience that submitted a proposal is discussed. This makes work easier for a client to determine which company is best suited to tackle the project.

Benefits of bid leveling

The bid leveling process saves a lot of costs. The process needs experience, due diligence, and discipline for the best results. Below are some of the benefits of bid leveling.

  1. A better comparison: The costs are allocated appropriately per the bid sheet line items.
  2. Accuracy in bid amounts: Bid leveling also catches errors and omissions, ensuring that the client receives accurate bids.
  3. Savings on costs: Clients can, in turn, save on costs as their construction spending reduces up to 5% when using bid leveling.

How to level a construction bid

The bid leveling process allows you to break down a contractor's services and offer you a clearer picture of the necessary assistance in your project.

review project requirements

1. Review project requirements

The first step is reviewing the general project requirements and ensuring all the bids meet these requirements. Ensure that the offers are bondable to the project. If a bidder has bid on a project that needs pre-cast concrete but only works with reinforced concrete, the bid should not be considered.

2. Identify similarities and differences

The next step is identifying the similarities and differences in the bids. Bids come in different formats, but you can see similar work categories. It would help if you also took note of areas where bids diverge. If you need any clarification, you should follow up with the candidates for clarity on particular costs.

3. Check the materials

The third step is looking for applicable material permits and purchases. Do not walk away from a contractor because the prices seem high, but instead, get clarity on price assumptions before making your decisions.

4. Ensure the correct plans are used

The final step is reviewing the document plans used. All the bidders should use the most recent plans and addenda to their project. Take notes on the drawings and proposals on approval dates. With this information, you will assess all estimates and settle on the best bid for your project.

Summary

Bid leveling allows a project owner to single out the best bids for a project. In some cases, the apparent high bidder happens to be the lowest bidder after the leveling process. It helps sift for the best bids if bids come in at a higher level than anticipated. The leveling process significantly impacts whether a project will be completed on time and within budget.