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What other factors should Marvin and his team consider?

As we know that Marvin’s nature of handling the business was
quite aggressive and the fact that his company was highly successful at winning
contracts through competitive bidding. As we know, competitive bidding is more
like a Transparent procurement method in which bids from competing contractors,
suppliers, or vendors are invited by openly advertising the scope,
specifications, and terms and conditions of the proposed contract as well as
the criteria by which the bids will be evaluated. Competitive bidding aims at
obtaining goods and services at the lowest prices by stimulating competition,
and by preventing favoritism. This brings into picture a very important factor
to consider – Profits. We shall discuss about Profit as a factor shortly.
Usually, competitive bidding is of two types:

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Open competitive bidding, where the sealed bids
are opened in full view of all who may wish to witness the bid opening. In this
type of bidding, all the documents and information are exposed without any
hidden terms or conditions. This helps give a clear idea of what the various
clauses are that needs to be considered by studying the bid while determining
whether it is a good idea to bid or not.

Closed competitive bidding is a type of bidding
where the sealed bids are opened in presence only of authorized personnel. On
the contrary, closed competitive bidding is a type of bidding where the
information is not exposed or released among all the witnesses but restricted
to a limited group of people who play a vital role in determining the decision
on bid or no-bid.

Now getting back to the factors that Marvin and his team
should consider making a decision of whether or not to bid on the job, lets talk
about that a little bit;

Profits:  End of the day, it is a matter of how much profit
an organization makes out of a project they bid on? If a firm/organization is
failing to make profits on a project, it is meaningless to even bid. Few things
to consider here are whether we have enough resources and equipment available
to execute the job? This is very important as it affects the project timeline directly
and eventually create differences between the project team and the client. Talking
about costs, labor plays a very vital role in determining how quickly the task is
achievable when compared to limited resources that again impacts the timeline. labor
and equipment costs should be thoroughly examined and reviewed prior to making
any commitments and ensure that enough allocation shave been made to cover any
additional costs that come up during the implementation. Companies usually tend
to ignore the added perks of an employee that are needed to be considered while
estimating labor costs. Usually employees can receive incentives in the form of
bonus, paid time off, sick leave compensation, taxes and other related benefits
that strongly impact on the budget. Once you determine what it will cost you to
complete the project, some additional factors to be considered are location,
contract requirement, planned method of construction, etc. besides determining
if the job will be profitable in submitting a winning bid.

Type of Client/Customer Background:  The better we understand the customer, the
customer’s requirements and objectives, the more likely we are to win. One also
needs to do some research on the history of the client as to study his project
strategies and capability to ensure fruitful results. Some factors to consider
here are:

Determine if the client belongs to either a Public
or private sector

Research about the Financial capability of the

Analysis on the Relationship with the client

Study the Expectations of the client

Read about the Form of the Contract

Depending on what type of client it
is, it helps play a pivotal role in a company’s decision to bid for a job or
not. Usually, individuals are more likely to bid for projects were there is an
existing and positive relationship with the client. If there are no additional empirical
values available upon review, it is of high importance to investigate a client’s
financial capability and his/her reputation amongst peers in the industry as
this helps maintain decorum and credibility throughout the project implementation.
The aim of this investigations is to secure that in case of getting the
contract awarded, the client is reliable, and payments will be made in time.

Historical Analysis/ Prior Project Outcomes: Imagine
submitting a bid exactly like a previously submitted bid that miserably failed,
and no feedback/outcome was recorded. There is a high possibility of repeating a
similar situation where the results are fairly the same. So in order to submit
better bids and win more work, it is highly advisable to keep records on all
your bids, both the successful ones and the ones you didn’t win as it helps get
a clear understanding of what caused you to lost out on a bid whether it was a
lack of experience or if you simply weren’t low enough on price. Also, it does
not hurt to ask the client for feedback after the bidding process is complete.

Capacity: It is extremely crucial to bid only
when you have the belief that you can deliver your services in the time frame in
which you’ve promised. This is to be fair to your team, the potential client,
and your fellow contractors. Always remember, when your crew isn’t selected for
a project, know that a better one is out there waiting for you to pursue!

Long Term Relationship: One other thing to
consider is when competing for any bid, either it be firm-fixed-price or changing
prices, the long-term strategy should also be considered if Marvin wants to
establish a good and healthy relationship with the client. This greatly help
build a strong connection with the client that possibly helps gain more
contracts where the customer brags about the project and turn out to be a
promoter in the market bringing in additional opportunities.

Terms and Conditions: This is another important
factor to consider while going through the bidding process. Most of the times a
client may ask you to take on a plethora of terms and conditions that put your
firm in jeopardy. For example, they may put you at risk of high consequential
damages in the case that the project doesn’t complete on time. While other
firms reject contracts that would hold them responsible for lost productivity
in the case of missed project deadlines. Thus, ruining the reputation of the
firm which affects their future contracts. Of course, the design firm strongly believes
in their ability to carry out the project successfully, but factors outside
their control could cause a missed deadline, and they wisely rejected the
contract as per the terms and conditions laid out initially. Always ensure to seek
assistance and involve your legal team to thoroughly review the Terms and
Conditions to reduce risk of lawsuits.

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