You may have asked yourself "Why do I need a professionally-developed bid tabulation analysis system when I can get bid tabs results for free from the DOT?" Or, said, "I already know my market and the prices that everyone is bidding." Or, stated, "Bid tabs data is history, we only look at future jobs and no two jobs are alike."
These are questions or comments heard every day from owners, estimators and project managers.
As the business climate gets more and more competitive, it becomes critical to have more information to make better business decisions. Just knowing the state average for a pay item is not enough. A bid tabulation analysis system gives you the speed, power and flexibility to easily generate much more information in much less time than ever before. Listed below are some of the benefits of using this system.
- Pre-Letting Job Analysis
Using a bid tabulation analysis system allows you to load historical averages for an upcoming job in just moments. In a matter of seconds you can have a rough estimate of the total project size and breakdown of each category of work including how much of the total is your work and how much is subcontracted. You can also see a comparison of your historical averages to your likely competitors on the project. This type of information takes only seconds to generate and provides a valuable "first look" at a project. The totals can also be used to provide information for bonding purposes.
- Competitor Analysis
Understanding your competition, the market and prices can make the difference between your business being first and second. Tabulation analysis systems allow you to see who your biggest competitors are and how you have historically stacked up against them. These systems can show you how much work your competition is bidding, how much they have left on the table and even a listing of the projects they have bid. The more you know about your competition, the better decisions you can make. You may not care about your competition, but I bet they care about you.
- Eliminate Errors
Although no two projects are exactly alike, many, if not most, of the pay items on each project are similar. Using a tabulation analysis system allows you to check your bid against historical averages and can highlight any areas that are outside certain parameters. This allows you to quickly check your bid and highlight any prices that seem out of line.
- Win Change Orders
When disputes with the DOT arise, you can set parameters to shore up and defend your prices. Although you will base your change order request on actual costs to perform the work, the DOT looks at historical averages when evaluating costs. With a tabulation analysis system, you can provide additional support for your proposal by searching through prices in a specific quantity range, a specific region or county and a specific time frame, all in just a few seconds.
- Search for Rare Pay Items
When bidding a job and it's almost the time to turn in your bid, you may notice that you don't have a price for a pay item you haven't seen before. When using a tabulation analysis system, you can quickly search through the database and see all the prices for that item. Even if you have to plug a price, you can be somewhat comfortable in the price you enter.
- Market Overview
Tabulation analysis systems can provide valuable "big picture" market trends. These systems can show month-to-month and year-to-year pricing and can analyze pricing for specific pay items, categories of work or overall market size and breakdown.
- Post Bid Analysis
Using a tabulation analysis system allows you to perform both summary and detailed analysis of a bid. This type of information can help answer the following questions: Where did we miss the job? Where did we leave money on the table? Did we get the best sub prices? Are there any areas of our bid that are lower or higher than our competition?
These systems are typically very easy to learn and use and allow you to sift through information in seconds. These tools give you an even better understanding of your market and your competition, as well as prices.
Tabulation analysis systems give owners and estimators access to historical information in ways never before possible. Although these systems are based on "historical" prices, the past is always a useful tool in knowing where you are going. An analogy would be a stock broker using graphs and charts to see the historical profits of a company. When you combine this history with knowledge of the current operations of a company, you can make accurate predictions of future returns. Just like having the right equipment on the job maximizes productivity, having the right tools in the office is just as important.
Construction Business Owner, April 2006
