Be the Best Bidder

Best Bidder practices for construction subcontractors

Best Bidder not lowest bidder

You know there are those who only choose the lowest bidder. No matter how detrimental that practice often is. It happens. This story from ENR tells the tale well.

And, here is another low bid fire station disaster.

If you wish to remove “lowest” from the criteria general contractors might use when considering your bid here are a few things for you to consider.  Because price shouldn’t be the only determining factor in a winning bid.

The Best Bidder will bring

 

  • Outstanding trade expertise.

 

  • Proof of required licenses and insurance.

 

  • Confirmation of past performance with comparable projects.

 

  • Excellent safety records.

 

  • Good equipment.

 

  • Demonstration of well-tended financials (including cash flow capabilities and good qualifications for meeting your vendors’ payment terms.)

 

Soft qualities of Best Bidders

While the following qualities are harder to quantify, they often fit in the make-it or break-it category for GCs. General contractors looking for the best bidder rather than the lowest bidder will watch for:

  • Responsiveness – responding to all forms of communication in a timely manner.

 

  • An excellent attitude – includes understanding how to respond to problems with creativity and a can-do attitude.

 

  • A dedication to teamwork – within your own company, with other trades, and with the GCs representatives, demonstrating your desire to create a mutually beneficial partnership.

 

  • Cleanliness – keeping the site as clean as possible at all times.

 

  • A reputation for integrity – honesty and sincerity, including owning up to your own or your team’s mistakes.

 

And, it is in these soft qualities where you have the most opportunity to promote your value as opposed to focusing on price.

Think about it — when your bid is close to other bids, often your reputation is all it takes to assure you get more than a passing glance.

Who you gonna call?

It is just as important to choose a general contractor worth submitting a bid to as it is to be a subcontractor worthy of consideration.

Here are questions vital to your pre-bid decision.

  • How long has the general contractor been in business?

 

  • How many subcontractors have they worked with? (Contacting past subs may give you an idea of how easy or difficult it is to work with this GC.)

 

  • Do they have procedures for handling conflicts?

 

  • How many levels of management do they have in place?

 

  • Who will be your point of contact?

 

  • What paperwork will be required? And how frequently?

 

  • When will the job begin?

 

  • What is the estimated time of completion?

 

  • What is the scope of the work required?

 

Best Bidder practices

Putting your best foot forward before the bid is called is only the first step. Take every opportunity to let GCs know why your services are better.

And finally, be sure to manage your bid processes well. Determine to focus on bidding projects that will result in profitable returns and repeat business.

 

It is our desire this article (among our growing library of construction-centric informational articles) is helpful in assisting commercial construction contractors build better building businesses. 

Providing Accounting and Advisory Board Level counsel for small to medium commercial construction subcontractors.

So you can Run With the Big Dogs. 866-629-7735

Implement a “Give it Away” Policy with Your Construction Team

Develop an above and beyond policy your team uses for dealing with clients

Develop an above and beyond policy your team uses for dealing with clients

Last time, I talked about making decisions concerning whether a change order is necessary when dealing with requests from clients. If you haven’t read that post, take time to do so. Otherwise, what I’m saying from here on out might not make much sense to you. Because, this time I’ll tell you how to go one step further in the process.

Ever thought about telling your team to give time and service to your clients at no additional charge? Ever thought about implementing a Give it Away policy?

Whoa, I know what you’re thinking. “I can’t possibly allow the crew to give it away, I’ll go broke!” That would possibly be true, unless you have a specific strategy in play concerning what and when to give away.

There are 3 levels involved in developing a Give it Away policy

Model the behavior

Model the behavior you want your team to emulate. Be the man or woman of integrity, conscience, and kindness you want every person on your team to be. When at all possible go the extra mile, give your clients more than they expected, be the guy or gal they want to recommend to others.

Teach your team

Teach your team what is acceptable in the give-more-than-expected category. Each trade will have its own set of approved above and beyond measures. Take the time to think about what will be on your “yes we can” list and make sure your team knows what they are. You’ll also have to let them know there may be things which pop up that aren’t on the list. Give them the metrics for discerning which are worthy. Should it be added to the list? You decide. And yes, there are likely to be mistakes made. Learn from it, teach your crew from it, and move on.

Reward the team

Reward those of your team who follow your guidelines and your model. Consider having a once a week Tattle and Reward session during your morning huddle. Fridays are a good day to practice this as events will be fresh in your team’s minds. It will likely take a few weeks to get the idea rolling, and its likely you’ll have to do much of the initial “tattling,” yet your crew will catch on. Encourage people to tattle on themselves also.

Here are some examples of what you want to hear from your team:

“I saw Dave helping our client unload some heavy boxes from his pickup.”

“I noticed Leslie installing a door knocker on Mrs. Smith’s new door.”

“I fixed the catch on the electrical box, so the client could open it from his wheelchair.”

You get the idea. The reward could be as simple as a round of applause for the person who is being tattled on. Or, you may wish to have a number of gift cards ready to be handed out to the hands who excelled. A five-dollar coffee shop card, a ten-dollar fast food card, a fifty-dollar gift card for a department store, or even higher denominations to a tool store might be in order. Some other rewards you may wish to include are branded coffee mugs and water bottles, lunch with the boss, books, lottery or movie tickets, a car wash certificate, or any item you know would be appreciated. It is up to you or a supervisor you designate what you’ll be giving, depending on the level of engagement from your crew members.

More for you to consider

The actions involved as well as the rewards given can range from the humble (screwed a latch back on a window) to the impressive (saved a client’s life.)

Training your team to be thoughtful won’t happen overnight.

The rewards you and your team receive by practicing going above and beyond won’t always be easily measurable.

Be sure to bring your sense of humor to the Tattle and Reward meeting, because . . . well you know, construction hands “just wanna have fun.”

If a mistake has been made, remember rewards take place in public, yet admonishments are taken care of in private.

Consider your social marketing angle and think about asking your team to provide pictures as often as possible. A phone and a specified email address could be all the tools they’ll need.

You can reach our construction accounting specialized team by calling 866-629-7735 or getting in touch here.

 

7 Things Impossibly Savvy Contractors Wear

Ever wondered which common traits shape successful owners of construction companies and construction service businesses? Here are seven foundational traits which are found in the “closets” of savvy construction contractors.

Garment #1 They are Servant Leaders

The following quotes will give you food for thought concerning how savvy contractors lead.

“If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” John Quincy Adams

“You don’t lead by hitting people over the head – that’s assault, not leadership.” Dwight D. Eisenhower

“What you do has far greater impact than what you say.” Stephen Covey

“Where there is no vision, the people perish.” Proverbs 29:18

“I define servant leadership as a person’s dedication to helping others be their best selves at home, work, and in their community.” S. Chris Edmonds

“The key to successful leadership today is influence, not authority.” Ken Blanchard

“Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.” Jack Welch

This article from Inc. encapsulates the concept quite well.

Garment #2 They are Resilient in the face of adversity

Ever wonder what it would be like to buy a construction company where the financials were “sinking like a rock,” turn it around, then make it extremely profitable within a few years? You might want to check out Isaac Lidsky’s story, because that is what he did. Oh, and did I tell you — he is blind.

He has written a book, Eyes Wide Open, you might want to check out. And, be sure to watch this video all the way to the end (after he completes his talk) because he reveals one important aspect of how he, as a blind person, is able to run his construction company. And, just in case you want a bit more information, here is a link to the company, ODC, where Lidsky is the CEO.

Savvy contractors understand the risks as well as the opportunities they’re facing. They can “get back up” after a shockwave hits. They understand how to manage complex ideas and situations. There is a sort of nimbleness to them. And, they’re really good at long-term thinking.

Garment #3 They are Self-Disciplined

Yeah, you know what this means and what it takes!

Garment #4 They have exemplary Core Values

They have personal core values which they bring to their businesses. This is all about what they believe, therefore how they act.

Here are some examples:

  • They take pride in their work. They enjoy seeing the finished project.
  • Their safety meetings aren’t solely based on outside influences (like OSHA,) but rather on the fact that they care about their employees.
  • They have integrity.
  • They understand the power as well as the responsibility that comes with being a leader.
  • They aren’t required to “lose the ‘tude,” because, in fact, they tend to have a good attitude most of the time.

They believe in striving for excellence, being honest, truly serving the customer, having fun, being fair, teamwork – you know, good stuff like that.

This article shows a pretty neat way to come up with and USE a common set of core values within your construction contracting or service business.

Garment #5 They are Flexible

They are flexible and knowledgeable concerning how to meet the needs of both employees as well as customers

Being flexible allows them to make it through the bad weather of changing desires, the bad weather of sudden new competition, the bad weather of employee shortage, the bad weather of equipment damage or loss, the bad weather of – well you know . . . bad weather.

Yet, they also know when to draw the line.

Thomas Jefferson said it like this, “In matters of style, swim with the current; in matters of principle, stand like a rock.”

Garment #6 They have Problem-Solving Skills

The simple explanation – Problem solving involves methods and skills to find the best solutions to problems. We all have problems. And, we all have problem solving skills. All good parents, doctors, waiters, truck drivers, accountants and everyone must solve problems day-by-day and hour-by-hour.

What sets savvy construction business owners apart from “regular” construction business owners is the continued practice and constant honing of problem solving skills.

Typically, there is a ladder of thought and action involved in reaching a solution.

One ladder of problem solving skills could look like this, with the bottom rung being Listening and the top rung, Implementing Solutions.

Implementing Solutions

Collaborating

Evaluating

Data Interpretation

Data Gathering

Anticipating

Listening

Savvy construction contractors simplify things, use “what if” thinking, and focus on the solution rather than the problem.

Garment #7 They Pay Attention to the Company’s Financials

Savvy construction contractors know that knowing what is happening with the bottom dollar is bottom line good business sense.

We’re happy to talk with you about what you need and what we can provide. Give us a call 480-442-4032 Toll Free: 866-629-7735

10 Personal Tools Every Construction Contractor Needs

I’ve discovered Construction Contractors and Subcontractors are among the most adept and proficient folks around. They wear such a profusion of hats (skilled tradesman, project manager, marketer, salesman, HR manager, supply-chain manager, customer-service representative, PR manager) it can be mind boggling.

Yet there are 10 Personal Tools they need to use no matter which hat they happen to be wearing at any given time.

The quality traits (tools) of excellent construction contractors

  1. Planning Ability

Simply determining to begin a business built on your skill set as well as your desire to learn more about what it takes to “be in business” is a great start. At every turn, your ability to plan and prepare for what is coming down the road will make a difference in how you manage, build, and maintain your business.

  1. Strong Work Ethic

You have to have a ton of ambition. It goes beyond just getting up every day and going to work. You actually enjoy fixing the problems that arise. And you’re actively looking for more jobs which mean you have more problems to solve.

  1. Strong People Skills

You not only have to manage the guys and gals in the field and office, you also have to work with the customer – who can range from general contractors to home owners and anywhere in between. You’re also good at letting other people’s strengths shine through.

  1. Confident

You have to remain confident in your overall ability to complete the many tasks at hand. That doesn’t mean you think you can never make a mistake. It does mean you’re sure you’ll be able to learn from those mistakes and continue moving forward.

  1. Open Minded

Going hand-in-hand with your ability to remain confident is your ability to remain open minded when new ideas, new concepts, and new means to accomplish a task are presented to you. You’re willing to weigh the evidence before making a final decision.

  1. Money Management Skill

When capital is limited and needs to be utilized wisely, you know how to manage for right now while still planning for the future. You know how to keep a handle on cash flow and how to use financial reports for building your business.

  1. Networking Ability

You’re a relationship builder. You pay attention to what others tell you. You’re willing to help others even when it doesn’t seem there will be a quid pro quo. You make others feel at ease when they’re around you.

  1. Delegator

Even though you likely began your construction contracting business wearing a multitude of hats you know when to give one or more of those hats to others. You know how to give people a task to complete without micro-managing how they complete it.

  1. Risk Taker

You understand that taking a risk is the only way to move forward. You look at all the ways you can think of to mitigate the risk, you take those actions, and you still know that failure is possibility.

  1. Integrity

Honesty and trust are central to your integrity. You demonstrate your integrity by being trustworthy and dependable. You are principled and can be counted on to behave in honorable ways even when no one is watching.

Stocking your tool box

Having as many of these tools as possible in your personal tool box will make your job as a construction contractor flow better. You may not have every single tool in this list shined and ready to use. But, if your desire is to scale your construction contracting business then you’ll discover these are personal traits or qualities that will work well for you now and in the future. If you find you have personal weak points, be sure to surround yourself with folks who are strong in those areas. Some things you should consider are: hire a business coach, seek a mentor, outsource some areas, look for qualified advisors, build a good team.

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Why yes, Schulte and Schulte, LLC is a great option for your bookkeeping and accounting outsourced needs. And by golly, we’re team players. Give us a call 480-442-4032 or toll free 866-629-7735