Bid leveling is essential for accurate subcontractor comparison. A well-designed spreadsheet reveals hidden costs, identifies scope gaps, and ensures you're comparing equal proposals. Here's how to build and use effective bid leveling tools.
What Is Bid Leveling
Definition
Bid leveling (also called bid analysis or bid comparison) is the process of normalizing subcontractor proposals to ensure accurate apples-to-apples comparison. It accounts for scope differences, exclusions, qualifications, and pricing structures.
Why It Matters
Without Leveling
- Lowest price may have scope gaps
- Exclusions become change orders
- Qualifications limit liability transfer
- "Surprises" after award
With Proper Leveling
- True cost comparison
- Scope gaps identified
- Risk properly allocated
- Informed decisions
Basic Spreadsheet Structure
Essential Columns
Subcontractor Information
- Company name
- Contact person
- Phone/email
- Bid date
- Validity period
Pricing Breakdown
- Base bid amount
- Alternates (each separately)
- Unit prices
- Allowances
- Total adjusted price
Scope Analysis
- Inclusions checklist
- Exclusions list
- Clarifications/qualifications
- Compliance notes
Row Organization
By Scope Item
- List all required scope elements
- Each sub prices separately
- Identify gaps immediately
- Compare line by line
By Subcontractor
- One row per bidder
- Columns for each scope item
- Totals at end
- Easy sorting
Template Design
Header Section
PROJECT: [Project Name]
BID NUMBER: [Owner Bid #]
DIVISION: [CSI Division]
TRADE: [Trade Name]
DUE DATE: [Sub Bid Due Date]
PREPARED BY: [Estimator Name]
Subcontractor Grid
| Item | Scope Description | Sub A | Sub B | Sub C | Sub D | Notes | |------|-------------------|-------|-------|-------|-------|-------| | 1 | Base Scope | $ | $ | $ | $ | | | 2 | Alternate 1 | $ | $ | $ | $ | | | 3 | Unit Price A | $/unit | $/unit | $/unit | $/unit | | | 4 | Exclusion Credit | ($) | ($) | ($) | ($) | | | | Adjusted Total | $ | $ | $ | $ | |
Scope Checklist
Example for Electrical
- [ ] Service and distribution
- [ ] Branch circuits
- [ ] Lighting fixtures
- [ ] Fire alarm
- [ ] Low voltage
- [ ] Generator connection
- [ ] Testing and commissioning
- [ ] Permit
- [ ] As-builts
Leveling Techniques
Scope Normalization
Identify All Required Scope
- Review specifications thoroughly
- List every required item
- Note specification section references
- Include general conditions requirements
Compare to Proposals
- Check each item against each bid
- Mark included/excluded/unclear
- Request clarification for unclear items
- Price missing items separately
Exclusion Handling
Common Exclusions
- Permits and fees
- Cutting and patching
- Scaffolding
- Winter conditions
- Testing beyond specified
- Extended warranty
Leveling Approach
- Identify each exclusion
- Determine if you need it covered
- Get pricing to add back
- Or adjust your coverage/carry
Alternates Analysis
When Subs Price Alternates
- Ensure same scope understanding
- Compare add/deduct values
- Consider probability of acceptance
- Factor into ranking
When Subs Don't Price
- Request pricing
- Use historical percentages
- Budget conservatively
- Note uncertainty
Advanced Features
Weighted Scoring
Price + Other Factors
- Price (60-70%)
- Experience/references (15-20%)
- Schedule capability (10-15%)
- Safety record (5-10%)
Formula Example
Score = (Lowest Price / Sub Price × 60) +
(Experience Rating × 20) +
(Schedule Rating × 10) +
(Safety Rating × 10)
Conditional Formatting
Color Coding
- Green: Best price per item
- Yellow: Within 10% of best
- Red: More than 10% high or missing
Automatic Flags
- Highlight exclusions
- Flag missing items
- Alert on outlier pricing
- Mark incomplete proposals
Linked Worksheets
Organization
- Summary sheet with totals
- Detail sheet per trade
- Backup documentation
- History tracking
Formulas
- Roll up from detail to summary
- Automatic total calculations
- Variance analysis
- What-if scenarios
Common Leveling Errors
Price-Only Focus
The Mistake Selecting lowest price without scope analysis
The Risk
- Change order exposure
- Schedule delays from gaps
- Quality issues
- Relationship problems
The Fix Always level before comparing price
Assuming Compliance
The Mistake Assuming proposal covers full scope if not explicitly excluded
The Risk
- Contractor interpretation differs
- Dispute after award
- Claims and back-charges
- Project friction
The Fix Verify inclusion of all key items
Ignoring Qualifications
The Mistake Overlooking "subject to" or "based on" language
The Risk
- Price changes after award
- Limited liability transfer
- Risk retained by GC
- Unexpected costs
The Fix Evaluate and price qualifications
Mathematical Errors
The Mistake Calculation errors in leveling spreadsheet
The Risk
- Wrong subcontractor selected
- Bid accuracy compromised
- Margin erosion
- Embarrassment
The Fix Double-check all formulas; verify totals
Trade-Specific Considerations
Electrical
Key Leveling Items
- Fixture allowances vs. specified
- Data/communications scope
- Fire alarm vs. FA contractor
- Generator connection vs. mechanical
- Permit responsibility
Mechanical
Key Leveling Items
- Equipment included vs. NIC
- Controls scope vs. BAS contractor
- Insulation scope
- Balancing and commissioning
- Startup assistance
Concrete
Key Leveling Items
- Reinforcing included vs. separate
- Formwork for architectural concrete
- Finishing levels
- Curing methods
- Testing and mix design
Sitework
Key Leveling Items
- Rock excavation pricing
- Dewatering
- Haul distances/disposal fees
- Import material sources
- Erosion control
Integration with Estimating
Workflow
Standard Process
- Issue bid invitations
- Collect proposals
- Level bids immediately
- Clarify as needed
- Select subcontractor
- Carry price in estimate
Timeline
- Start leveling as bids arrive
- Don't wait for all bids
- Allow time for clarification
- Complete before bid day crunch
Documentation
What to Keep
- All original proposals
- Completed leveling sheets
- Clarification correspondence
- Selection rationale
- Negotiation notes
Why It Matters
- Audit trail
- Dispute resolution
- Learning for future
- Team communication
Subcontractor Communication
Pre-Bid
Improve Bid Quality
- Clear scope descriptions
- Bid forms with required items
- Pre-bid meetings
- Question deadlines
Set Expectations
- Leveling will occur
- Complete bids expected
- Exclusions will be priced
- Best value selection
Post-Bid
Clarification Requests
- Specific questions
- Written responses
- Deadline for response
- No price changes for clarification
Award Communication
- Clear scope of work
- Exclusions covered by GC
- Schedule expectations
- Contract terms
Technology Integration
Spreadsheet Best Practices
File Management
- Consistent naming convention
- Version control
- Backup procedures
- Access permissions
Template Maintenance
- Update for new scope items
- Refine based on experience
- Standardize across team
- Train users
Software Options
Dedicated Bid Leveling
- Purpose-built for construction
- Scope libraries
- Integration with estimating
- Collaboration features
Spreadsheet Add-Ins
- Enhanced functionality
- Custom forms
- Automation
- Reporting
Conclusion
Effective bid leveling separates successful contractors from those constantly dealing with scope gaps and change orders. A well-designed spreadsheet is the foundation, but the real value comes from thorough analysis and good judgment.
Invest time in creating templates that work for your common trades, and refine them based on experience. Train your team on consistent leveling practices, and review leveling decisions after projects complete to improve future accuracy.
The goal isn't just picking the lowest price—it's identifying the best value while fully understanding the scope and risk each subcontractor's proposal represents.
ConstructionBids.ai helps you organize bid opportunities and track proposal deadlines, giving you more time for thorough bid leveling.
