Sunday, January 13, 2013

How to Decide When to Receive and Open Bids

There are a number of considerations that public agencies should take into account when making the decision on what day public works bids should be received.  These factors should all be considered together to determine the best schedule for when to receive bids.

What's required?  Some states and local governments have laws that specify how many days a public works construction project must be advertised for prior to receiving and opening bids.  Research this and know what requirements govern your agency.

Project schedule:  Each project has certain schedule deadlines that need to be met.  Bid openings should be scheduled in order to keep the project schedule on track.

Bid preparation time:  Public agencies should pay attention to the size and complexity of the project in making the decision how long a project should be advertised for.  If too little time is provided for bidders to prepare their bids before the bid submission deadline, they may either not bid, or submit an unreasonably low or high bid due to not having had sufficient time to understand the project.  An unreasonably low bid may cause problems during the project and result in unnecessary change orders. 

Other projects:  Pay attention to other projects from other public agencies that may be advertised and bidding at the same time.  If there are too many bid openings for the same type of work scheduled for one day, bidders may be forced to pick bidding only a limited number of projects.  This may result in fewer bids being received by your agency, and thus less competitive bids. Try to schedule bid openings when there are not a lot of other bid openings by other agencies in the general region.

Best days of the week:  Most public agencies make it a practice to only receive and open bids on Tuesdays, Wednesdays, or Thursdays.  Receiving bids on Mondays or Fridays may reduce the number of bidders since the bidders' staff may be taking vacation time for a long weekend.

Holidays:  It is a wise idea to avoid receiving and opening bids around major holidays.  Like Mondays and Fridays, it may limit the number of bidders, reduce competition, and result in higher prices for the public agency.
Mike Purdy's Public Contracting Blog 
© 2013 by Michael E. Purdy Associates, LLC

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