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Estimating & Bidding

Subcontractor Bid

In Plain English

A specialty contractor's price offer to a general contractor for completing a specific portion of the work.

Definition

A subcontractor bid is a price proposal submitted by a specialty contractor to a general contractor for a defined portion of the project work. General contractors collect subcontractor bids for all major trades before assembling their own bid to the owner. The GC typically uses the lowest qualified subcontractor bid for each trade to minimize overall project cost.

Why It Matters in Bidding

Subcontractor bids make up the majority of most general contractors' total bid value, so the quality and timing of those numbers largely determine whether the GC's proposal is competitive and accurate. GCs must level scattered, inconsistently scoped sub bids to compare equivalent work before plugging a price into the final estimate. A missed exclusion or apples-to-oranges comparison at this stage can turn an apparent low bid into a money-losing award.

Example

The general contractor received four electrical subcontractor bids ranging from $310,000 to $385,000, but after leveling found the lowest one excluded the fire-alarm scope, making the $340,000 bid the true low number.

Related Terms

Bid LevelingBid PackageGeneral ContractorBid Shopping

Frequently Asked Questions

Differences usually stem from scope interpretation, included or excluded items, assumed quantities, crew productivity, current backlog, and how much risk each sub prices in. One bidder may carry permits or specialty equipment another excludes. That is why general contractors level bids line by line rather than simply picking the lowest dollar figure.
Subs typically submit hours, sometimes minutes, before the GC's deadline to the owner. This compressed window pressures GCs to receive, level, and incorporate numbers quickly. Late sub bids are common on bid day, so estimators often carry placeholder budgets and swap in firm prices as they arrive right up to submission.
Bid shopping is when a GC discloses one subcontractor's price to competitors to drive numbers lower after bids are received. It is widely viewed as unethical, can damage sub relationships, and is restricted on some public work. It differs from legitimate bid leveling, which compares scope rather than pressuring subs to undercut each other.

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