Non-Communication of Bid Results...

With a lack of in-person networking events, conferences, etc. I don’t have any breaking industry news to talk about lately. So, I’m going to ramble about a pet peeve of mine – not receiving any response or feedback when you are an unsuccessful bidder…

To submit a bid/proposal for process equipment requires a lot of work for no return unless you win the bid. Just pricing a custom designed piece of equipment can require quotes from dozens of vendors and many hours of work by a number of engineers combing detailed specifications, not to mention preparing the proposal and sometimes even preparing custom drawings and lifecycle cost analyses for the bid. The very least the recipient of the bid can do is inform the unsuccessful bidders who won the bid and the decision-making process uses in selecting the winner. 

Ideally I also like to see the price spread of the bids or an evaluation matrix that was used so I know if we were competitive and may have a chance of winning next time or if we should not waste our efforts. Often that feedback is provided, particularly for government projects where it is a requirement to provide a bid tab, but there are also many cases where no feedback is provided at all. I haven’t heard back on an industrial job bid a few months ago where we were begged to submit a bid and had to drop everything to get this together in less than 2 weeks, it was submitted at 11pm on a Friday night (bids due by 12pm) and since then it has been all crickets… I did find out indirectly after the bid that we were just there to provide another number so I haven’t pursued a response (plus I was a bit bitter about not being seriously considered after the owner pleading for us to bid). You can’t win them all but a response that we were not successful and why would be nice.

Here are my rankings from worst to best on the types of bids that provide feedback and why I think this is the case:

 

1. Industrial Projects

These are the worst for feedback. My theory for this is that to the owner, this is a one-off transaction and they don’t think they will need to bid this out again, so who cares what the losing bidders think… It is these projects, bidding either direct to the owner or via a consulting firm, where more often than not I have not had any feedback after a bid without badgering them. Good luck getting bidders if they need to rebid the project!

 

2. Design-Build and CMAR Bids

These can be confusing where the contractors ask for firm pricing at 30%, 70% and maybe 90% design and you never know if a selection will be made at the earlier stage quotes or the contractor is just checking the budget. That is often not communicated, so you can put in a lot of work on a proposal when a decision will not be made yet. On the other hand, you could throw a swag budget number out there at 30% design and find out a few months later someone else was selected based on a lower price… I think the contractors like to keep their options open and not commit too early unless they really need to pick a vendor early to help with the design.

 

3. Preselection Bids

In this case you are often sending bids to the design engineer or the owner, where the engineer makes the evaluation based on a selection criterion. Typically, you find out formally who won, but often no reason or a very vague reason is provided for the selection. So there is little you can learn about why you were not selected. These bids are the ones that often require specific system drawings and detailed lifecycle analyses. Where very little feedback is provided, I suspect the engineer or owner had a preferred bidder from the start and you were just making up the numbers. If the bids are sent to a municipality, in most cases you will get a detailed bid tab after the evaluation is complete (see Municipal Bids).

 

4. Municipal Bids

Where a bid is made directly to a municipality, it is a requirement that a bid tab be provided showing the ranked prices submitted. Selection criteria is usually very transparent and a manufacturer is left in no doubt where it finished up and why.

 

There are exceptions when there are some qualitative evaluation factors used as well as price with percentages or points applied to each factor to select a winner. This is where the grey kicks in and the owner (or engineer) can massage the numbers to pick who they want. The evaluation matrix will be published but the results can be very subjective. This also applies to direct/pre-selection bids.

 

5. Design-Bid-Build Contractor Bids

These are bids where you are providing your price to contractors on bid day and the contractors are submitting a total project bid to the owner. There are usually no grey areas here – the contactor will go with the lowest price in nearly all cases unless an OEM has a special relationship or the contractor has had a bad experience with an OEM. If the contractor must write in the suppliers on the bid form, you know within 24 hours if you were selected. If not, you rely on the honesty of the winning contractor to go with the low bidder on bid day and hope there is not post bid backroom deals done (if you were low on bid day). It is possible to get an idea of where the competitor pricing was if you know one of the bidding contractors well enough who will give some feedback. It is in a contractor’s best interest to provide some feedback if he thinks you may be working together on a future project. Otherwise, there is no way to find out if you were way low, or way high.

 

With all that said, it is nearly impossible to predict what feedback you will get despite the type of bid unless you have bid to that entity in the past. If you suspect you are just making up the numbers with another bidder preferred, you could very well be wasting your time and don’t expect any useful post bid feedback.

The comments and opinions in this post are my own and not those of my employer.