GC Hard Bid Soft Bid

A General Contractor (GC) is a professional who is responsible for overseeing and coordinating the construction of a building or other structure. In order to do this, a GC must bid on projects and be awarded the job by the owner or developer. There are two main types of bids that a GC can use: a hard bid and a soft bid.

A hard bid, also known as a fixed-price bid, is a type of bid in which the GC provides a firm, fixed price for the entire project. This price is based on a detailed estimate of the cost of labor, materials, and other expenses required to complete the project. The GC will typically provide a detailed breakdown of these costs to the owner or developer, and the bid will be based on these estimates.

A soft bid, also known as a cost-plus bid, is a type of bid in which the GC provides an estimate of the cost of the project, but does not provide a fixed price. Instead, the GC will charge a percentage of the total cost of the project, plus any additional expenses that may arise during construction. This type of bid is typically used when the scope of the project is not fully defined or when there is a high level of uncertainty about the cost of the project.

There are pros and cons to both types of bids. Hard bids are attractive to owners and developers because they provide a clear, fixed price for the project. This can be especially useful in situations where the budget is tight and there is little room for cost overruns. However, hard bids can be risky for GCs because they are based on estimates and can be difficult to accurately predict. If the GC underestimates the cost of the project, they may end up losing money on the job.

Soft bids, on the other hand, can be more flexible and allow for changes to be made to the project as it progresses. This can be beneficial for GCs, as it allows them to adjust to any unforeseen challenges that may arise during construction. However, soft bids can be less attractive to owners and developers because they do not provide a fixed price for the project. This can make it difficult to accurately budget for the project and may result in cost overruns.

In conclusion, hard bids and soft bids are two different types of bids used by General Contractors to bid on construction projects. Hard bids provide a fixed price for the project, while soft bids provide an estimate of the cost of the project, plus any additional expenses that may arise. Both types of bids have their own pros and cons, and the right choice will depend on the specific needs and circumstances of the project.