How to Create Jobs or Start a Business by Bids and Quotes

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Do you want to find work by creating a flow of jobs for yourself and/or others -- to get freelance arts, or acquire an order or a project in a skill that you have or can supervise or be manager/worker -- in all kinds of things, such as:

• Website design, video, photography, keyboarding, writing, technical-writing,
• Handwork, art, food catering, seamstress for cleaners/laundry, tailoring for clothiers,
• Mowing, yard-work, floral arrangements, formal landscaping,
• Maintenance of rentals, cleaning homes, commercial custodial services,
• Repairs or tech-work, remodeling, construction,
• Architecture, engineering, appraisals, inspections,
• Private or government contracting, subcontracting under other contractors, etc.

You may seek and make bids as an individual and as an independent contractor/subcontractor, with or without a crew/partners, (or even as an estimator, pricing and bidding proposals as an employee finding work and jobs for an establishment), bidding and quoting. Here's how to do it.

Steps

1. Prepare yourself for the new work: This may be the key if individuals or corporations expect success from the bid-tendering process. Some preparation may demand a capital investment for software or equipment, and if you or your representative is to travel to perform a site visit, sales call, or if you and others need to take part in additional training, but not all preparation is costly.
2. Get the job specifications: Learn all about the work, materials, products or project that you need to bid on. If there is one, get a copy of the "Request for Quotation" (RFQ) that gives you, the bidder, the exact special information and instructions, called specifications. You must prepare a specific written proposal of all the work and services you or your company will perform and the amount that you will charge.
   
   • Your bid has to be accurate, exact, on their requested points and provide your answers so that the customer can decide upon whether to award the work to you. They have to decide, whether you are capable, qualified, can do the level of quality and of the size needed; do you have the equipment and personnel, etc.
3. Be sure that you read the specs of your job or product and prepare your exact bid -- understanding all of the specifications and knowing the skill level and quality that you and your partners or employees must be able to do. All must be documented as needed, following specifications or instructions precisely. If you win the bid you may need to satisfy things such as for:
   
   • Large companies and the government, do complex bids including formal sales agreements (samples, multiple inspections, surveys, testing, debugging, photo or printed proofs, schedules, etc.), insurance clauses required for you the contractor, procedures manual, health and safety disclaimers, environmental protection policy, etc.
     
     • Ask for any examples of such a job quote as you want to bid, including how they want your proposal letter, bid and a sample sales agreement. It may be several pages of information to put in a formal bid.
4. Write your job bid. Turn it in at the time it is needed. It must be formal looking, neat and official. Print it out on your letterhead or your company bid/proposal form.
   
   • Include the name of the individual or company for whom you are making the bid proposal.
   • Follow a logical job order, ie: follow order of the RFQ from the customer (the requesting company).
   • Break out and extend cost subtotals. Customers expect to receive clearly how much you charge per unit or hour, if that is how it could be charged, or per item provided.
   • Along with such subtotals, give the grand total of everything clearly. If you bid without per unit (not broken down), or without totals, your customer can not trust your bid.
5. Ask the customer whether they will accept and seriously consider a bid using a different process or materials, done your way (for you and your team's know-how or a specialty). If they will, then they will let others bid on your method, too. But if they will not, they may say it is not fair to other bidders to allow different specs for you. So unless you have an exclusive method, then it may be no advantage (but it is worth a try, if you have a less expensive, good, similar material or a good way to do it -- but not to their same spec).
6. Show a portfolio of similar work on your website (jobs you've completed): include your online gallery of photos, articles, documents (or PDFs) and references for customers to read.
7. You, as the bidder, or a partner, or sales persons should follow-up: visit, call or email to thank the potential customer for the bid and ask for the business to check your bid status and ask whether there are any questions. Show your interests to them for bidding on future jobs, and ask to demonstrate your products, services, and tote your product availability.
8. Keep all commercial aspects of the quote in confidence, but it is important to get any details of the winning bid outcome and winning price if possible. After the award is made to the winner, it is a better policy for the customer not to reveal to you and other bidders the amount by which they beat or overbid to the other losing bidders. This is considered a good standard.
9. Stick to your bid, proposal, estimated amount, time schedules and specs. If you get the job, avoid a costly penalty on your company for being late. Avoid having to do it over, or not get paid, or make them a big discount, if you do not follow their specs precisely in production or such!
10. Get paid, considering giving up an early pay discount: this requires knowing the terms and how long you expect to wait to be paid. The Vendor (you) may have quoted a payment term of "Net 30 days" (no discount to pay early). A customer/buyer may ask and stipulate their proposed payment term of "1%/10 Net 30" (1% discount if your invoice is paid within 10 days by the buyer, otherwise the total amount is due in 30 days), for example if you give:[1]
    
    • 1% discount for early payment monthly discount, if you are a vendor/supplier, on a $50,000 per month business supply invoice = $500 break per month x 12 is $6,000 / year savings for the buyer. That means that the buyer can save by paying early and your receivables are to be discounted monthly. Cash flow might be an issue with your company and some buyers prefer or end-up paying late rather than early, but if you can make a case to identify potential savings, you may find prudent account payers, on payables, are all over paying early to get their discount. In any event, discuss this before putting it on the table.
11. Watch out for the buyer to possibly negotiate for an even higher discount: when they are prepared to award the winning bid to you, as you, the Vendor are ready to take the order, and are in their office and have quoted a payment term of "Net 30 days" -- meaning no discount (which is your standard bid). Yet, the buyer may ask you to agree to a "2%/10 net 30 days" payment term; so in the example if you give: [1]
    
    • 2% discount on $50,000 sales per month implies the buyer would receive a discount of $1000 per month x 12 is $12,000 / year savings for the buyer, on the invoice amount if full payment is made each month within 10 days of delivery, otherwise the total amount is due within 30 days. If they succeed, they have created an opportunity to save thousands of dollars off of paying you in the course of the year. Not bad for a few minutes work for them!

Tips

• The low bid is often accepted, but sometimes the purchaser writes to explain why they do not accept your lower bid (such as your bidding differently from their spec material or method).
• Any RFQ will be subject to the opportunity to bid, get the award or have your bid rejected. You as a supplier/producer are put to some expense and at times, or possibly a very considerable one in travel, lodging, samples, dining with suppliers and customer, in these exercises. After all, you wish to ensure they will ask you to bid on future requirements.

Warnings

• If you bid your work on their process and materials "or the equivalent" while thinking that you'll do it using your own chosen (less expensive) way, and that you'll use your kind of process or materials: No! They can accept your cheaper price but insist on their specs, methods and materials because:
  
  • If there is a choice such as the spec "or the equivalent", the customer gets to choose what they had specified (not letting you choose your preferred way, oops!), or you lose the customer by backing out -- if they say yes at that price but require using the spec materials and processes.
• You can even get sued for damages, according to the required sales agreement, if you miss their schedule, or because of having to do over or start over.
• Keep in mind, if bidders are aware their prices are being disclosed to their competition, they may opt to no longer bid on quotations for that customer, opening the door for other vendors, but undermining each other, and removing the competitive aspect of your bids tendered.

Sources and Citations

• Partially based on information about sample RFQ, quote, letter sample, some free templates, http://rfqpro.com/

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