Leveling Subcontractor Bids Under a No-Exception Hard Bid
You are the estimator for a general contractor bidding a $6.4 million occupied school renovation as a lump-sum hard bid. Bids are due Thursday at 2:00 p.m. and the district's form permits no exceptions or qualifications. Your takeoff puts drywall and metal framing at $478,000. You hold six sub quotes: the low at $412,000 excludes fire-rated shaftwall and notes ceilings by others; the second at $469,000 is complete; the other four are complete and run $475,000 to $496,000. Addendum No. 3, issued Wednesday morning, converts 8,400 sf of corridor ceiling from acoustical tile to suspended gypsum board and pushes substantial completion out two weeks. The low drywall sub says by phone he will not honor the addendum at his price. The bid form includes a unit-price line for unforeseen rock excavation with no quantity stated.
1. The low drywall quote is $57,000 under both your takeoff and the next complete quote. Do you carry it? Show the arithmetic and the reasoning that gets you to a number.
Read the worked answer
Carry a leveled number, not the low number.
- Reconstruct the missing scope at your own unit costs: shaftwall at two stair enclosures and the elevator lobby, roughly 1,100 sf at about $34/sf installed = ~$37,000; ceiling scope inside his quote exclusion (corridor and restroom ceilings) = ~$21,000.
- Leveled, the $412,000 quote is about $470,000 - statistically identical to the second, complete quote at $469,000. The $57,000 gap is scope, not price.
Why it matters: the bid form forbids qualifications, so any exclusion you intend to carry cannot be passed to the owner. A lump sum built on an incomplete sub quote converts the gap into a straight loss the day the work starts, and it will surface in week one when the shaftwall crew shows up.
Decision path:
- Carry the $469,000 complete quote as the base.
- Give the low sub until Wednesday 5:00 p.m. to requote the full scope in writing, including the addendum.
- If he signs a complete scope sheet under $465,000, use him - after confirming his bond capacity, current backlog, and last two projects' completion record. The cheapest number from a sub who cannot staff it becomes your delay claim.
- Never carry an oral promise. If the written requote does not arrive, the $469,000 stands.
2. Addendum No. 3 arrives about 30 hours before bid. Walk through how you price it and what you do about the ambiguities, given that the deadline will not move.
Read the worked answer
Price it as a deduct-plus-add on your own unit costs, not the sub's:
- Deduct 8,400 sf of acoustical ceiling at roughly $3.10/sf installed = -$26,000.
- Add 8,400 sf of suspended gypsum board at roughly $7.50/sf = +$63,000, plus perimeter trim and re-hung light fixtures.
- Net direct cost ~$37,000.
- The two-week extension changes your general conditions: two weeks of supervision, temporary facilities, and equipment at, say, $9,500/week = ~$19,000. Total ~$56,000.
Three things to do before you seal the envelope:
- Acknowledge the addendum on the bid form. An unacknowledged addendum is a defective bid in most public procurements.
- Check the buildability of the new ceiling. The RCP and the structural drawings are the ones you bid; the heavier gypsum ceiling may need different attachment and may sit in a corridor where a beam soffit was already tight. Submit an RFI immediately, and simultaneously carry the cost on your stated assumption so you are not pricing an unknown.
- Do not modify the drawing or invent a detail. Price the addendum as drawn and record the assumption in your bid file, not in the bid.
Note the asymmetry: the owner controls contract time, so you cannot bill the two weeks as extra - you can only build your general-conditions cost into the lump sum, and only if you recognize it before Thursday.
3. The bid form has a unit-price line for unforeseen rock excavation with no stated quantity. How do you fill it, and what risk are you taking?
Read the worked answer
Price it from first principles, not as a bet.
Build the unit rate bottom-up: excavator and hoe-ram day rates, rock-breaking labor, trucking, and disposal or crushing cost, divided by realistic daily cubic yards. For most sites that lands roughly in the $85 to $110 per cubic yard range. A fabricated number like $400/cy is not estimating; it is unbalanced bidding, and the exposure is real:
- Owner protection. Public and many private owners screen for material unbalancing - a unit price that does not reflect reasonable cost plus markup can be grounds to reject the bid as nonresponsive, or to reprice the item.
- Payback risk in the other direction. If the owner's own estimate is 2,000 cy and the actual is 300 cy, a high unit price earns you almost nothing, while a low one keeps you competitive.
- How the line gets used. Read the fine print on whether the owner may award by item, whether the unit price applies to net changes in both directions, and whether unit prices govern deducts as well as adds.
Best play: a defensible, cost-based unit price with your backup in the file. You want the line to be competitive and credible, not clever. If you believe rock is genuinely likely, the better lever is a qualification in your own estimating file plus a contingency in the lump sum - not a distorted public number.