A scenario I am encountering for the first time as a relatively new small business owner. Any feedback/suggestions would be appreciated.
A week or so ago I was approached to prepare an estimate/proposal on a project for a client. A few days later a different client requested a proposal for the same project. I have a relationship with both clients and have performed work for each in the past and hope to continue to do so in the future. First proposal has not been accepted and no signed work authorization is currently in place.
Do I..
1. Submit proposal to second client without letting either know that I have been contacted by the other party?
2. Submit proposal to second client and inform both parties that I have been approached by the other?
I know which way I am leaning, but there is a wealth of information and experience here on this forum and would be interested in others thoughts.
Sound like your clients are putting their proposals together too. They are probably aware the "other guy" has got his eye on the same job.
My experience tells me it's a good idea to give them all the same proposal, but discreetly. This is common, especially if GCs are soliciting quotes for providing surveying services for their construction projects.
I'd go with option 1. It's none of their business who else asks you for proposals, unless you agreed to some sort of exclusive deal.
It may be time to start charging for proposals.........
I know people that do just that, companies contact them to work up a proposal of costs because they are good at taking a set of plans and doing just that.
I have had different people contact me about the same job hoping that I would cut one of them a deal.
3. Submit proposal to second client without letting either know that I have been contacted by the other party, but not hide the fact in any way, from anyone.
that is SOP in my little world forever.
Very standard issue in general contracting. The general contractor needs 47 different subvendors to fulfill everything called for in the project specs. If 10 general contractors are bidding on the same project many of the subvendors will be the same on several, if not all, bids by the general contractors. You may be low bidder for general contractor #4 but are next to low bidder for general contractor #7. General contractor #4 never contacted the competitor who would beat you out if general contractor #7 gets the job.
You don't have to share everything you know with everyone else but you do not want to look as though you have favorites. That will be readily apparent at the bid opening when every bidder gets to see how every other bid was put together. If your bid of $67458 appears on several bid lists, it is clear you have treated them as equals.
Texian,
This is a common situation in both the construction and design world. I have no problem providing proposals to multiple clients for the same job. If I am asked to team exclusively I will contemplate it but there has to be something in it for me. Other that that, I will not voluntarily let other clients know that I am on multiple teams and if asked I will let them know that I am but not with whom. I will diffidently not divulge a clients approach to any other possible proposers. For the most part each proposer for a design project usually has a slightly different approach to a project and my proposals and fees reflect that fact. I would love it if I could give out the same proposal to multiple clients but that rarely happens in my business.
John Putnam, post: 417024, member: 1188 wrote: If I am asked to team exclusively I will contemplate it but there has to be something in it for me.
I've only done this once, and the only thing I got it off it was good will. The team I committed to didn't get the job, it went to the one I declined. I don't think I'm going to do any more exclusives.
One of the best projects I ever worked on was where the general was hired by owner then the general had an exclusive bid list that they pulled the trades from. It was a fast track job and it went so smooth and all made fair money and got along beautifully, no back charges or complaining. I have always questioned low bid projects sense then. Jp
Texian, post: 416989, member: 10243 wrote: A scenario I am encountering for the first time as a relatively new small business owner. Any feedback/suggestions would be appreciated.
A week or so ago I was approached to prepare an estimate/proposal on a project for a client. A few days later a different client requested a proposal for the same project. I have a relationship with both clients and have performed work for each in the past and hope to continue to do so in the future. First proposal has not been accepted and no signed work authorization is currently in place.
Do I..
1. Submit proposal to second client without letting either know that I have been contacted by the other party?
2. Submit proposal to second client and inform both parties that I have been approached by the other?I know which way I am leaning, but there is a wealth of information and experience here on this forum and would be interested in others thoughts.
Give them both the same proposal. Be careful though, there is a reason that you are proposing the same job for different clients. Ethics come into play. Something is going on that you do not know about and never divulge that you have talked to another about the same project. Your price should be what it is, regardless of the client and revealing information to another is a breach of ethics.
1. submit the same proposal to whomever asks for it. you are competing just as much as they are. If one sub asks for a different scope, respond to that sub with your revised scope.
Jim Frame, post: 417027, member: 10 wrote: I've only done this once, and the only thing I got it off it was good will. The team I committed to didn't get the job, it went to the one I declined. I don't think I'm going to do any more exclusives.
Jim,
I did not mean to imply that I received any compensation for going exclusive. Just that I figured that it gave our team a significant competitive edge over the other proposers. I have only done this a couple of times and only for good, long term clients that had a way better than average chance of being awarded the project.
Texian, post: 416989, member: 10243 wrote:
A week or so ago I was approached to prepare an estimate/proposal on a project for a client. A few days later a different client requested a proposal for the same project. I have a relationship with both clients and have performed work for each in the past and hope to continue to do so in the future. First proposal has not been accepted and no signed work authorization is currently in place.
Do I..
1. Submit proposal to second client without letting either know that I have been contacted by the other party?
2. Submit proposal to second client and inform both parties that I have been approached by the other?.
Nothing unusual there. If they give you identical scopes they get identical prices.
If a third (fourth, fifth etc) contractor approaches you for the same project but gives a better defined scope that limits your risk they get a better price based on the scope they provide.
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If the scope varies slightly or past experience indicates a large pleasure/pain factor discrepancy between client I would not hesitate to have different quotes.
Steve
Texian, post: 416989, member: 10243 wrote: A scenario I am encountering for the first time as a relatively new small business owner. Any feedback/suggestions would be appreciated.
A week or so ago I was approached to prepare an estimate/proposal on a project for a client. A few days later a different client requested a proposal for the same project. I have a relationship with both clients and have performed work for each in the past and hope to continue to do so in the future. First proposal has not been accepted and no signed work authorization is currently in place.
Do I..
1. Submit proposal to second client without letting either know that I have been contacted by the other party?
2. Submit proposal to second client and inform both parties that I have been approached by the other?I know which way I am leaning, but there is a wealth of information and experience here on this forum and would be interested in others thoughts.
You surely do not want to change the numbers here. The thing is that if you do, they will know and you will alienate one or both of the clients. Let them know you've bid the project for someone else, and just don't say for whom, and that this is the price you gave the other party.
John Putnam, post: 417048, member: 1188 wrote: I have only done this a couple of times and only for good, long term clients that had a way better than average chance of being awarded the project.
That was the scenario I went exclusive on -- the firm I teamed with was local and well-respected. But they still didn't get the job, and had I teamed with both I'd have gotten the work. Done with exclusives!
sjc1989, post: 417088, member: 6718 wrote: If the scope varies slightly or past experience indicates a large pleasure/pain factor discrepancy between client I would not hesitate to have different quotes.
As a variation on this theme, my fee to a firm with which I have long and positive experience is going to be lower than my fee to an unknown. For the latter I'll pad it some to account for the uncertainty in the working relationship, including payment practices.
I agree with Peter. Send to both and there is no reason to tell them proactively. We don't hide anything if they ask, but most are smart enough to know we aren't exclusive. I've only been asked once if we put in a proposal for another company on the same project and they didn't ask anything about pricing. We have to do this all the time since many of our clients bid the same project, and our company is typically the Engineer as well.
I don't agree that the numbers need to match. We are always consistent in the way we bid the projects (Time/material we feel it's going to take times our billing rates). Some clients prefer things staked in a certain way which may equal more time, so not all proposals are the same.
Good question, great responses.
I will agree with those that say if the scope of work is exactly the same, and there is no PITA factor with a repeat client, then the price should stay the same. But if a repeat client is a pain, takes a lot of hand holding, or a lot of "hey can you check this for me really quick", then I would just adjust their proposal with some additional man hours. Just make sure it is stated in the proposal.
Brian Gillooly, post: 417105, member: 12268 wrote: Send to both and there is no reason to tell them proactively. We don't hide anything if they ask, but most are smart enough to know we aren't exclusive.
Lets face it PITA's are an increase in SOW. If I was ever asked why the numbers were different I would explain it in terms of SOW rather than straight out tell them they are a pain. Every so often the music stops and some of the staff at my former favorite client moves to what's probably about to be my former PITA. I don't burn bridges if I can help it.
Steve
