From Bidding To Winning
Writing a strong proposal is tough. How can firms in the Architecture and Engineering (A/E) industry improve their bid writing for better outcomes?
A firm in the A/E industry is the sum of its projects. But to secure projects, first, you need to bid for them.
Bidding is an art. To win clients, you need to be able to predict project cost and profitability; and to do that, your proposals need to be evermore financially robust and accurate.
Under the lid of the bid
What can go wrong in the bidding process? The primary cause of financial distress is when project costs overrun. So in order to maximize project profitability, you need to showcase ways to improve project management; relatively small changes can have a big impact on your firm’s bottom line.
In the A/E industry, an average of 20% of projects do not meet their profitability targets because their estimate costs are inaccurate. It’s even more difficult for firms without a centralized database with project histories and cost data. Institutional knowledge of prior projects can help project managers develop more accurate fee estimates without resorting to guesswork.
Developing accurate, attractive proposals
New business opportunities require strong proposal-writing skills, as firms must prove their expertise. Clients like to have a menu of choices, as it makes it easier to understand what they are paying for. To achieve client satisfaction, as well as results for your company, why not address project profitability in project initiation procedures?
Work up a signed contract that clearly states the scope and payment schedule of the project. If there is no contract, agree on an authorization-to-work letter from the client and attach a comprehensive project budget and schedule. This might seem obvious, but it is not an industry standard procedure. Only 60% of the time do A/E firms require an itemised project budget breakdown before time is billed to a project, and only 32% of firms require a project schedule before time is even billed.
In order to improve your project management, make sure you’ve planned your milestones and scrutinized your budgets. Our solution, Timemaster, helps provide real-time information, crucial to project profitability. Since implementing the solution, Timemaster customers have seen an increase of 43% in project profitability, because with it, they can manage and predict costs more efficiently – creating infallible bids.