Recieving confirmation to do the bid job, only its been

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copper123

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How do you folks handle these kinds of situations.

I bid a pretty good size communications job five months ago. It's big for me, 60,000. Anyhow, at the time I had a electrical partnership. We both were partners and didn't have to pay workers comp, overtime, all of those hidden costs that eat you up. We always just worked till we dropped and actually enjoyed it. The work was really drying up so we bid the job cheap to get it. The Gov. told us they had funding to do the work. Well, the hurricanes hit, Iraq, and a few other things and the money got cut I guess. Now, they just told me that they have funding and want me to do the work. A lot of things have changed in the last 5 months. My entire company has restructured. My partner moved to another area just to keep working, and if I am to do the job, i will have to hire more work force. Overtime and payroll taxes will need to be paid as well. We basically bid the job to make wages and to keep fed. In my bid, I always note that the bid is only good for 30 days. When they gave me a notice to proceed I told them it would be with a cost change. Just the UTP has gone up a ton. With the cost of wire, and my new labor issues, i figured it would take about 4000 more. They want me to break it all down for them and show every cost change ect. I know my bid was really low compared to other bids so I am almost to the point of just telling them this is where i can be at,and I really can't do any more for them. I don't want to act like a flake, but it is what it is. There is a good chance that I won't make any money on it anyhow. We are now fairly busy but I want to honor my bid as much as i can. Anybody have any advice on how this should be played out. I am still fairly young and have not been hit with this situation before.
Thanks in advance.
 
Re: Recieving confirmation to do the bid job, only its been

In my bid, I always note that the bid is only good for 30 days.
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That would be as clear as day to me, I do the same thing, you also mentioned all the differant scenarios that can affect a bid in such a long stretch of time, all legitimate issues, you should be given the opportunity to rebid, instead of pin pointing this and that, where you could overlook one thing an lose a lot of money, I would ask to rebid the job. :cool: :cool:

[ January 12, 2006, 08:50 PM: Message edited by: Jhr ]
 
Re: Recieving confirmation to do the bid job, only its been

past 30 days, you are past honoring your bid. if they can get away with doing that to you, you will never be able to stand back up straight. It's basically a new bid, tough for them. You don't need to lose your shirt to someone who is trying to stick it to you.

If you don't want to get ****ed, don't bend over. If you want the job you still need to stick to a NEW bid. You do NOT owe them anything.

sorry for the redundancy
paul
 
Re: Recieving confirmation to do the bid job, only its been

More redundancy..I'll spare you the details.
 
Re: Recieving confirmation to do the bid job, only its been

Thanks guys,
I feel the same way also. It's just good to get a few other thoughts. Tomorrow i am going to write a nice respectiful letter and tell them I am not going to justify anything. The price of copper has gone through the roof and my labor situation has changed. I think it will say something like I will be more than happy to do the work with the extra cost change or would gladly give them another bid if they want to rebid the job.
I just hope it doesnt black list me for future jobs. The more I think about it, I kind of feel like it is the right thing to do for all contractors. If I accept this kind of business practice it hurts all of us in the long run.

Thanks
 
Re: Recieving confirmation to do the bid job, only its been

I dumped the 30 days in favor of 10. 10 days is longer than enough time to pick and choose. And it gives me a loop hole to bow out if I want to.
 
Re: Recieving confirmation to do the bid job, only its been

Past the time frame of 30days.. Re-bid the project

If they balk at that idea, TIME & MATERIAL all the way.

You would be surprised, the responses you get when you tell the person those are the terms, they will usually say you can re submit your price.

If you take the job you bid 5 months ago, they will walk all over you, or not pay you period. Or want stuff for free.

B

[ January 13, 2006, 05:45 AM: Message edited by: BBechtel ]
 
Re: Recieving confirmation to do the bid job, only its been

Becareful here. You said this was a bid to a government agency. What did the bid documents say? I have seen government specs that required a bid to be valid for 120 to 150 days.
Don
 
Re: Recieving confirmation to do the bid job, only its been

Thanks Don,
The bid is actually to a minority contractor that gets all the work on the base. They call it a BOSS contract. Base operations and support contract. Basically, this contractor gets a crack at all work that comes up. If they don't want to do it, or don't have the man power, they sub it out. This contract is like that. I submitted my cost change to the prime contractor, and they passed on the change to the Gov. The Gov. is coming back with the request to line item every cost change to the original bid. With just a little footnote, it would seem that this style of Gov. facility contract is popping up everywhere. I am seeing more and more private, minority contracts replacing the old style of actual Gov. employed workers handling bid work. The Katrina mobile home building contract was like this. It went to a minority contractor with out the bidding process taking place in the local area.
 
Re: Recieving confirmation to do the bid job, only its been

You must understand that you are a business and to run like a business. Generally I find small contractors to be hard working good people but very naive. If your bid said 30 days you are free. ( unless you signed something we are unaware of. ) From your post you are in trouble already. The job does not have enough money in it. The additional 4000.00 does not seem like enough to get you out. You only move back up into a lose position from a really poor lose position at the original price. Do not start a job that you are uncomfortable with on the price. You must tell yourself I owe them nothing. Then continue to negotiate until a fair price is arrived at, that is acceptable to you and your customer. If you are concerned about future work with this contractor, future work at an unrealistic low price is not work.
 
Re: Recieving confirmation to do the bid job, only its been

30 days and out. Have you looked into leased labor? There is a company here that leases experienced help at a reasonable cost. It will get you a better picture of how much your labor costs will be. Material takeoff you already have. Just put the numbers together and add 50% or more. I think what they are asking for is a price and not to rebid the job. Its a headache to rebid something in the public sector. If they are negotiating make sure you are asking the right price. Otherwise over 30 days its null and void.
 
Re: Recieving confirmation to do the bid job, only its been

I don't think the government's request (i.e., for an itemized list of the cost changes) is unreasonable. You have picked a number already; how did you arrive at that number? Higher price of copper? Higher cost of labor? Tell them that.

My concern, however, is what they will do next. If they say "we'll give you this much more, but not that much more, because your itemized list doesn't justify the money you are asking," then you should simply decline the project. You are under no obligation to do otherwise.
 
Re: Recieving confirmation to do the bid job, only its been

Originally posted by charlie b:
I don't think the government's request (i.e., for an itemized list of the cost changes) is unreasonable. You have picked a number already; how did you arrive at that number? Higher price of copper? Higher cost of labor? Tell them that.

My concern, however, is what they will do next. If they say "we'll give you this much more, but not that much more, because your itemized list doesn't justify the money you are asking," then you should simply decline the project. You are under no obligation to do otherwise.
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Here, Here. That is the reason for the increase. Just tell them
 
Re: Recieving confirmation to do the bid job, only its been

I would not itemize anything.
total cost of job, period.

Tell them the increase and why.

If you itemize, the'll want to sub portions of the job out. so if you are high on the service, they'll get someone else to do the service, etc...
 
Re: Recieving confirmation to do the bid job, only its been

Providing an itemized list, in this case, is a very bad idea. Part of the bidding process is posturing. If you give the appearance as to much of an accomodator, then you may get taken advantage of. Providing to much information gives your contractor more power then he should have. If you must, it is better to give a general list, then a total of the price increase. But I would never break it down. Next they will want you to break down everything including profit, overhead, etc.
 
Re: Recieving confirmation to do the bid job, only its been

Coper123, you probably already know this but I thought I would bring it up anyway. If this is a Federally funded project, you will probably be required to pay the prevailing wage and benefits for your area. In some areas this is little more than usual but in others it can be a real increase in cost. I would check with the department of labor to make sure of compliance. I know of one contractor that ended up paying about $10 extra an hour to all employees for several months of back pay ( they were not compliant ).
 
Re: Recieving confirmation to do the bid job, only its been

I know of one contractor that ended up paying about $10 extra an hour to all employees for several months of back pay ( they were not compliant ).
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More than that, I know a guy who spent his weekends in Jail for 2 years because they busted him for a willful violation of Davis Bacon wage laws.
 
Re: Recieving confirmation to do the bid job, only its been

Yes, Davis bacon wages are pretty steep. With payroll taxes, benefits, and wages its a chunk of change. I actually like to bid the davis bacon jobs, the guys that work with me make better money and can actually get ahead.

[ January 14, 2006, 09:56 AM: Message edited by: copper123 ]
 
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