QUANTITY

SURVEYING
BIDDING
PROCESS
6 STEPS OF CONSTRUCTION PROCESS

Conception Pre-construction
Design

Procurement
Post-construction

Construction

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  Name of project and a short description
BIDDING PROCESS  Bidding document information: available
date, time and location
 Pre-bid conference or details identification
meeting information
 Bid proposal submission date
 Type of proposal
INVITATION TO BID  Approximate contract amount
 Approximate size
 Project location
 Licensing requirements
o The bidding process for the contractor begins  Bid, performance, and payment bond
with the invitation to bid. Other similar requirements
documents are the request for proposal and  Contractor prequalification requirements
request for quotation.  Name of owner
o The invitation to bid can be in the form of a  Name of architect
letter sent to a select group of contractors by  Name of engineers
the owner or by the architectural/engineering  Contact information
firm. Alternatively, it can be publicly
announced or advertised.
TYPICAL INFORMATION INCORPORATED IN BID
o A bid advertisement should have a minimum
advance notice of 30 days prior to bid ADVERTISEMENT / INVITATION TO BID
document issue.

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PRE-BID CONFERENCE
 Pre-bid conferences are a means for the
owner and design team to meet with the
contractors who are intending to bid for
the project.
 Pre-bid conferences are usually held, if
possible, at the project site, shortly after
the invitation to bid or roughly towards
the middle of the bidding period but
should be no later than 20 days prior to
bid date.
 When a pre-bid conference can be held
on the site, the owner and design team
may conduct a site tour for all the
contractors.

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PRE-BID CONFERENCE
 A pre bid conference allows the owner
and design team to communicate last-
minute information or new information
about the project to the contractors.
 In addition, the meeting also allows the
owner and design team to respond to any
questions the contractors might have
relating to the bidding document.
 All the new information presented, the
responses to the questions, and any
clarification of the bidding document
should be confirmed in writing and issued
to all bidders as an addendum.

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BIDDING PROCESS
OBTAINING BIDDING DOCUMENTS
ELEMENTS INCLUDED IN THE BIDDING
FORM
 Invitation to bid
 Instruction to bidders
 Proposal form / bid form
 General conditions
 Special/Specific conditions
 Plans and drawings
 BOQ
 Specifications
 Addenda
o After receiving a set of the bidding
documents, the first step is to review
the drawings and specifications and to
make the critical decision of whether to
bid for the project.
o Factors to be considered in reviewing
the documents and in making a decision
to bid can be categorized into three
groups; internal factors, project related
factors, and external factors.
REVIEW OF THE BIDDING DOCUMENT AND THE
DECISION TO BID
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 REVIEW OF PLANS
Architectural Design
Structural Design Complete Construction Plan
Plumbing Design
Electrical Design
(Technical drawings & details)
Mechanical Design

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REVIEW OF SPECIFICATIONS
Products
Materials, Tools & Equipment Construction
Workmanship
Methods & Testing Contract
Standards

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INTERNAL FACTORS
1. Current Commitments
The amount of on-going construction
work must be considered in order to
prevent the firm from work overload.

2. Other Available Projects

When many projects are available for
bidding, priorities must be set for the
project for which the firm has the best
chance of winning.

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INTERNAL FACTORS
3. Bidding Time
This is the amount of time available for the
firm to prepare the bid or the time
between the issue of the bidding
document and bid submission. Bidding
time varies depending on the size of the
project, the complexity of the project, the
completeness of the drawings, and the
efficiency of communication and
dispersion of information among all the
parties involved.

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INTERNAL FACTORS
4. Bonding Requirements
This refers to whether performance bonds or
payment bonds are required. In addition, the
firm’s bonding capacity must be considered as
it can influence its ability to bid for the current
project as well as future projects.

5. Business Plan
The project type and requirements must be
considered with the firm’s business plans kept
in mind as this can have an impact on the firm’s
future growth and other capital investments.

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INTERNAL FACTORS
6. Personnel and Equipment
The available qualified staff and support staff are
crucial to the decision to bid. The availability of the
firm’s already owned equipment must also be
considered so as to maximize equipment utilization
and minimize idle time. Alternative sources for
acquiring additional personnel and equipment must
also be considered.

7. Finances
Financial resources are a significant factor that must
be considered when making a decision to bid on a
project. The firm must analyze its existing working
capital, current and future cash flows, and the
available credit line from financial institutions.

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PROJECT – RELATED
FACTORS
1. Past Working Experience
The past experiences of the parties in the contract
can have a major influence on the firm’s decision to
bid.

2. Quality of Drawings and Specifications

Poor quality documents are those that are faulty,
vague, and inconsistent. Future problems must also
be anticipated and considered in the decision to bid
on the project.

3. Contract General Conditions

For example, payment provisions and retainage
clauses can have a significant impact on the
construction work schedule and the firm’s cash flow.
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PROJECT – RELATED
FACTORS
4. Time Constraints
Any time constraints in the contract, such as
project completion date, must be properly
evaluated for schedule adequacy and
feasibility. This is especially important when
liquidated damages are specified.

5. Public Relations
The community’s perceptions and reactions to
the project must be taken into consideration
when the project is unpopular.

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PROJECT – RELATED
FACTORS
6. Project Funding
It is important to determine the source of
funding for the project and whether the project
is adequately financed. Consideration should
not be given to projects that are not
adequately financed or when the source of
funding is unreliable or based on future
arrangements.

7. Award Time
The waiting time between bidding and contract
award, often long for public projects, must also
be taken into consideration in preparing the
bid.
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PROJECT – RELATED
FACTORS
8. Project Special Requirements
When special knowledge or skills are required
for the completion of the project, the sources
for such knowledge and skills must be
determined and established.

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EXTERNAL FACTORS
1. Competition
The higher the number of bidders, the higher
the risk is of not winning the bid. Although the
number of bidders is important, it is equally
important to know the companies that will be
competing in the bidding.
Previous encounters with known competitors
must also be considered for bidding patterns as
well as competitor specialties. Competing with
companies the firm never bid against before
can create a sense of uncertainty and increase
the risk of losing the bid.

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EXTERNAL FACTORS
2. Economic Outlook
The outlook of the local or national economy as
well as within the company must be considered
in making a decision to bid.
During periods of economic downturn, a
contractor may prefer to work with minimal or
no profit, rather than suffer the losses that the
company might face due to the lack of work
and the burden of maintaining office overhead
costs.

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EXTERNAL FACTORS
3. Local Labor Condition
The labor supply must be evaluated to
determine availability and sufficiency. Other
sources must also be considered if there is a
potential for labor shortage.
Alternatively, labor can be brought in from
surrounding locations or work can be
subcontracted out.

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EXTERNAL FACTORS
4. Availability of Suppliers and Subcontractors
This is especially important when bidding in
new territories. Considerations regarding local
suppliers and subcontractors must take into
account their ability to adequately supply
needed materials, special knowledge, and
skills.
Alternatively, remote suppliers can be
established, and the subcontractors brought in
with the consideration that their prices remain
competitive.

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NOTE:
Should the firm choose not to proceed,
the bidding process would terminate
with the firm returning the document
and getting back the refund when
applicable.

However, if the firm chooses to

proceed, the major work in preparing
the proposal begins.

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Organizing the
Estimating Team
o With the decision to pursue the work, the
firm can organize the estimating team for
bid preparation.
o The size of the estimating team will be
dependent upon the size of the project and
the personnel the firm has available during
that time.
o The team can be one or several persons.
The firm may appoint a senior estimator to
lead the estimating team.
o It is vital that only one individual be in
charge of the overall estimating effort. This
individual will be the lead or chief
estimator.
Organizing the
Estimating Team
o For small projects, she may be working alone
or with minimal help when doing most of the
estimating work.
o For bigger projects, the lead estimator will
be in charge of breaking down the work and
making detailed work assignments to the
estimating team.
o The estimating team can be composed of a
staff specializing in different work, such as
quantity surveying or the pricing of different
elements in the project.
QUANTITY SURVEY
o The real work of estimating begins with the
quantity survey or quantity take off.
o The quantity survey establishes the list of
quantities of materials that are to be used in
the project. This list of materials is
documented in the project’s bill of materials.
o The quantity survey is the basis for all
subsequent estimating tasks and directly
affects how the contractor plans and
executes the construction effort.
o A detailed and accurate quantity survey is
vital for the success of the contractor
performing the work.

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QUANTITY SURVEY
However, in situations where works are to be
subcontracted, it is still essential for the
general contractor to perform the quantity
survey. The reasons include:

1. Better understanding of the work to be

subcontracted.
2. Establishment of fair cost estimate for evaluating
subcontractors’ bids.
3. Checking of a subcontractor’s scope of work.
4. Determination of time duration that can be
assigned to a subcontractor.

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PROJECT SITE
INVESTIGATION
Some of the critical items an
estimator looks for include:
1. Site access
2. Availability of utilities: water,
electricity, and telephone
3. Site drainage
4. Proximity of adjacent structure
5. Site layout
6. Vegetation, terrain, and soil
conditions
REVIEW OF BIDDING DOCUMENTS BY THE CORPORATE STAFF AND
LEGAL TEAM

 With the decision to bid, the bidding document must be scrutinized and thoroughly
reviewed by the corporate staff and legal department in order to ensure that the
firm is not entering into a contract in an unfavorable position.

 In addition, all critical contract clauses must be identified and considered in the
preparation of the bid.

 Examples of such clauses are those relating to payment procedures, retainage

clause, guarantees, imposed dates, and liquidated damages.

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RETAINAGE

• Retainage is a practice unique to the construction industry. It

is the practice of withholding a percentage of the payment
due to the contractor for the work performed and completed
for that payment period.
• The purpose of the retainage is to give leverage to the owner
in ensuring that the work is completed successfully. It is a
form of guarantee.
• The period of retainage withholding varies according to the
contract, which may be at 50% completion, or project
substantial completion, or project final acceptance.
• A typical retainage amount is 5 to 10% of the periodic
payment and is usually applied until 50% of the work is
completed. Retainage can affect the cash flow of the
contractor and must be considered in the preparation of the
bid.

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RETAINAGE

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• Liquidated damages are provisions in the
contract that are designed to compensate the
owner for economic consequences the owner
might suffer if the contractor fails to complete
the project on schedule.
• The inclusion of liquidated damages in the
contract can result in higher bids due to
increased risks faced by the contractor.

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CONSTRUCTION
METHODS
 The selection of the construction
methods to be used on a project is
one of the major factors affecting
the final amount of a bid and
consequently its competitiveness.
 Construction methods here
encompass the way in which the
project is to be executed; what,
where, and how temporary facilities
are to be built; what equipment is
to be used and how much; labor
needs; and which elements of the
work are to be subcontracted out.
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CONSTRUCTION
METHODS
 The planning and selection of the
construction methods must take
into consideration information from
the site visit report as well as from
quantity surveys.
 Site conditions and any physical
restrictions onsite can affect the
choice of equipment and how work
is to be accomplished.
 The types and volumes of work
determined by the quantity surveys
can also influence the choice of
equipment and installation
procedures. 33
CONSTRUCTION
METHODS
 The planning and selection of the
construction methods must take
into consideration information from
the site visit report as well as from
quantity surveys.
 Site conditions and any physical
restrictions onsite can affect the
choice of equipment and how work
is to be accomplished.
 The types and volumes of work
determined by the quantity surveys
can also influence the choice of
equipment and installation
procedures. 34
SCHEDULE AND
PRODUCTION RATES
• A construction schedule is the contractor’s
plan for the execution of the work and is an
integral part of the estimate.
• The schedule not only dictates when work of
one element starts, but also dictates the
order in which the work is to be executed
and when each phase should be completed.
• In developing a schedule, the estimator must
review the bid document, which may require
specific work items or work areas of the
project to be completed by a specified time
or in some order.

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SCHEDULE AND
PRODUCTION RATES
• The planned project completion date must
be evaluated and considered during schedule
development.
• Another crucial factor to be considered is
weather. Inclement weather can affect the
work by slowing down or stopping the
operations. A construction schedule must,
therefore, plan around poor weather and
consider the lower construction productivity
faced during periods of inclement weather.
• Finally, the schedules submitted by the
subcontractors and vendors on the project
must also be considered in the preparation
of a project’s preliminary schedule.

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FINALIZING THE PROJECT
ESTIMATE
• Cost and pricing information must be
determined and compiled for all the cost
elements in the project.
• The contractor must determine the total cost
of materials, labor, and equipment (rented or
from his fleet).
• Then any subcontractor bids selected for the
project are added along with a markup for
managing the subcontractors.
• Finally, jobsite and general overhead costs
together with anticipated profit are added to
the estimate to produce a total bid amount.

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CLOSING THE BID
• The final process of putting the bid
together is crucial and is usually done
within a limited amount of time,
often in the last 24 hours prior to the
bid date deadline.
• To properly organize the information
and minimize errors due to omission,
a bid closing checklist or bid summary
sheet may be used.

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CLOSING THE BID
• The bid closing checklist can serve as a
reminder of key items to be included in
the bid. It may be developed for a
particular project based on the project’s
requirements, such as signatures, bonds,
and permits.
• A bid summary sheet or recapitulation
sheet (or just “recap”) is often used to
summarize and compile all the costs
associated with the project. Only one
person, usually the lead estimator,
should be in charge of completing the
form in order to minimize confusion and
the possibility of missing an important
item.
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SAMPLE BID PROPOSAL TEMPLATE

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SAMPLE BID PROPOSAL TEMPLATE

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ASSESSMENT ACTIVITY 1

PRESENT A SAMPLE BIDDING DOCUMENT FROM AN ACTUAL

ENGINEERING PROJECT. CREATE A PRESENTATION (5 TO 10
MINUTES RECORDED VIDEO) EXPLAINING THE IMPORTANT
DETAILS IN THE DOCUMENTS.

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