Eighteen Thousand Square Yards of Asphalt

Act in writing, immediately, before award. Preserve the bid worksheet, takeoff, and the marked-up bid form. An oral heads-up is worth nothing.

What the numbers actually say: the error is a quantity entry, not a rate error. Beacon's $17.22/SY is its real cost-plus-markup rate. The bid schedule quantity - 42,000 SY - was fixed by the owner. Applying the owner's own correction clause:

• 42,000 SY × $17.22 = $723,240
• Correction to the total: +$309,960 → $2,909,960

That puts Beacon above the $2,850,000 second bidder. The likely outcome is that the owner corrects the bid, Beacon is no longer low, and Beacon loses the award - at zero loss. That is the good result.

The real risk is the opposite one: if the owner tries to hold Beacon to $2,600,000 based on "the total is the total," Beacon is being asked to perform 18,000 SY of asphalt it never priced ($309,960 of direct cost) on a contract with roughly $2,662,000 of actual cost - about a $62,000 loss before overhead. In that scenario Beacon's written notice, the bid form showing the owner's own 42,000 SY quantity, and the unit-price-governs clause are the evidence for relief on a unilateral clerical mistake, or for reformation to the corrected total.

Beacon refuses to sign the contract as written and refuses to mobilize on an oral assurance of "we'll work it out later."

Position to state in writing:

• The bid schedule quantity was 42,000 SY. Beacon's entry of 24,000 SY is a clerical error that appears on the face of the bid against the owner's own document.
• The unit price of $17.22 governs by the owner's instructions, and extending it at the schedule quantity yields $2,909,960.
• Accordingly the bid is either corrected to $2,909,960 or withdrawn; award at $2,600,000 would be enforcement of a unilateral mistake the owner has reason to know about, since the unit price the owner itself read aloud produces a different number.

Options, ranked:

1. Correction or withdrawal - cheapest, and defensible.
2. Negotiate a unit-price contract at $17.22/SY for actual quantities. This removes the mismatch risk entirely and can be sold to the owner as protection for both parties.
3. Perform at $2,600,000 only if Beacon consciously accepts roughly a $62,000 loss as the price of the relationship and the schedule - and only with a written change order path for the quantity difference.
4. Refuse and default - worst option: bid bond exposure (commonly 5–10% of the bid, i.e. $130,000–$260,000), potential Board complaint, and a reputation hit that outlasts the job.

What Beacon must not do is start work, then discover it has no written position on quantity. Notice before performance is the whole case.

Reconstruction:

• Priced quantity: 24,000 SY at $17.22 = $413,280
• Actual quantity: 42,000 SY at $17.22 = $723,240
• Direct cost understatement: $309,960
• Corrected direct cost ≈ $2,352,000 + $309,960 = $2,661,960
• At the bid price of $2,600,000: margin = −$61,960, i.e. −2.3%, before any home-office overhead allocation

Process failure: nobody reconciled the takeoff quantity against the owner's bid schedule. The estimator priced from his own takeoff and never ran the bid-schedule-to-takeoff comparison, and no second person touched the item. An item worth 16% of the total was entered by one person, unchecked.

Fixes that actually work:

• Two-person rule on any line item exceeding 5% of bid value.
• Mandatory reconciliation of every bid-schedule quantity against the plan takeoff, with variances flagged and resolved in writing before submission.
• A bid-day checklist that includes unit-price × quantity re-extension on a calculator, not just the spreadsheet total.
• An independent review of any bid that is more than 5% below the nearest competitor - being that far under is information, not luck.