November 27, 2024

Checklist for Bidding on Larger Projects

1. Determine if the Project Is a Good Fit
Leverage past experience to guide your decision. If your team has successfully built a two-mile bridge, evaluate whether scaling to a 10-mile bridge aligns with your capabilities. Reflect on your company's track record to assess if the leap is manageable.
Additionally, account for inflation, as today's costs can make standard-sized projects appear larger.
2. Assess Your Capabilities
Evaluate your leadership skills and your team's overall capabilities to ensure they are sufficient for the complexities of a larger project.
3. Consider the Project's Impact on Cash Flow
Larger jobs often require significant upfront costs, impacting your company's cash flow and existing projects. Plan for this by increasing working capital, securing credit lines, or raising borrowing limits.
4. Evaluate Internal Controls
Robust accounting and project management platforms are essential for larger projects. Invest in the necessary tools and systems to scale your financial oversight and track costs in real time.
5.Review Standard Contract Agreements
Ensure subcontractor contracts reflect updated insurance requirements and other specifics for larger projects. Urban environments with high foot traffic, for example, may demand increased liability coverage.
6. Secure Multiple Subcontractor Bids
Obtain multiple bids for each aspect of a project to ensure accurate pricing. A single subcontractor bid poses risks of underestimating costs.
7. Requalify Existing Subcontractors
Verify that your usual subcontractors can handle the demands of a larger job. This ensures they possess the sophistication and technical expertise required.
8. Ensure Team Leaders Are Committed
If your success hinges on newly hired staff with specific expertise, confirm their commitment to staying with the company for the duration of the project.
9. Evaluate Existing Commitments
Review your current obligations to ensure you have the resources and capacity to complete both existing and new projects.
10. Avoid Underpricing the Work
Larger projects are prone to unknowns, including inflation and supply chain disruptions. Ensure pricing accounts for long-term changes and unexpected challenges.

Final Thoughts
When deciding whether to bid on a larger project, thoughtful planning is critical. By addressing these considerations, construction companies can better position themselves for success while minimizing risks.
Disclaimer: This article provides general guidance and does not constitute legal or financial advice. Always consult with appropriate professionals for specific concerns.

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