What Is a Government Bid Worth? The Profit, Odds and Five-Year Value
Win work that leaves money in the business. Calculate the return on each bid, then see how repeat public customers, references and service contracts can grow your company.
A government bid's expected value is contract value multiplied by your contribution margin and your probability of winning, minus the cost to prepare the bid. Then evaluate renewals, repeat work and the references that help you win the next customer. An award ceiling is not guaranteed revenue, and contribution is not take-home profit. Bid Control by PorchRocket helps you find suitable work, research past winners and price and prepare the response.
What matters most
- Expected bid value equals contract value × contribution margin × win probability − bid preparation cost.
- At the $168,591 roofing median, an assumed 20% contribution margin, one-in-three chance and $1,800 bid cost produce $9,439 of expected value.
- Three bidders is the median; use comparable results and your own history to assess the opportunity to win.
- At an illustrative $72,240 annual price, five years of retained service work produce $361,200 in revenue.
- Use Texas and Virginia's prompt-payment rules to build a billing process around the buyer's contract and legal payment obligations.
A $200,000 government contract can be worth less to your business than a $120,000 job down the road. The larger award may consume four times the estimating hours, tie up your crew during its busiest month, and leave less money after delivery. The award amount is only the first line of the calculation.
I start with what remains after doing the work, then ask how much we should spend for a chance to earn it. The owner’s evenings have a cost. Previous bid tabs help with the odds. Renewal hopes stay out of the committed-work column.
Bid Control by PorchRocket brings nearby opportunities and past award records into that decision. The worksheet below puts those records beside your costs so you can decide whether to bid, how much estimating time to allow, and what a retained customer could contribute over five years.
The four inputs behind bid value
Multiply the revenue you expect from the scope by its contribution margin and your assessed award probability, then deduct the pursuit expense you pay either way.
Expected bid value = contract value × contribution margin × probability of winning − bid cost.
Use four inputs you can explain:
- Contract value: the revenue for the scope and term you are evaluating, excluding uncommitted extra work.
- Contribution margin: the share left after the delivery costs included in your model, available to cover remaining overhead and profit.
- Win probability: your assessed chance of receiving the award, including qualification, competitive position and the chance the procurement proceeds.
- Bid cost: the hours and outside expenses required to pursue this opportunity, paid whether you win or lose.
Suppose a contract is $200,000, the contribution margin is 20%, your assessed win chance is 25%, and preparing the response costs $2,000. The calculation is $200,000 × 0.20 × 0.25 − $2,000 = $8,000.
The $8,000 is the probability-weighted value of pursuing the job. A win produces $40,000 of modeled contribution before the $2,000 pursuit cost. Budget that pursuit cost up front and use expected value to decide which opportunities deserve the investment.
Use the formula to compare opportunities competing for the same estimating time. If one job requires 80 hours to produce $8,000 of expected value and another requires 20 hours to produce $5,700, the second may deserve attention first. Capacity can matter more than the larger headline number.
Two bids competing for one estimating week
Give the next estimating slot to the job with the stronger expected return per hour, provided you can staff and finance the work if awarded.
An estimator’s next week is a limited resource. So is the crew’s next available work window. A bid decision accounts for both.
Consider two hypothetical pursuits:
| Input | Large unfamiliar package | Smaller familiar job |
|---|---|---|
| Contract value | $280,000 | $120,000 |
| Modeled contribution margin | 20% | 20% |
| Assessed win chance | 25% | 30% |
| Total pursuit cost | $6,000 | $1,500 |
| Expected value after pursuit cost | $8,000 | $5,700 |
| Estimating time required | 80 hours | 20 hours |
| Expected value per estimating hour | $100 | $285 |
The smaller job produces less expected contribution in total but 2.85 times as much per estimating hour. If only 20 hours are available, it may be the better choice. If capacity allows both and the crew schedules fit, the company can evaluate both pursuits.
Both pursuit budgets use an assumed $75 per hour and no additional outside expenses. Add travel and other costs when your response requires them. A cheap-looking estimate can consume expensive owner attention even when little cash leaves the bank.
Now check what a win would displace. Suppose the larger package would force you to pass on already attractive work or rent equipment you would not otherwise need. Include the relevant added cost and lost contribution when comparing the choices. Signed commitments come first.
Do the same review for service routes. A nearby building can share supervision and travel with an existing account. A distant building at the same contract price can require a separate trip every day. Put those differences into the delivery estimate instead of using an identical margin for both jobs.
Put a name beside the preferred job and reserve its estimating hours. Leave the second pursuit on hold until someone confirms capacity. An attractive spreadsheet does not create another estimator.
A $1,800 pursuit budget, including owner time
Staff hours count from the first scope review through submission, including the site visit and the time spent chasing supplier quotes or a surety letter.
Start a pursuit budget before estimating. Owner time counts even when it happens after dinner and never appears on payroll as a separate expense.
Here is a worked $1,800 bid budget using 22 hours at an assumed $75 internal hourly cost, plus $150 in direct expenses.
| Task | Hours | Cost at $75 per hour |
|---|---|---|
| Read scope and qualification requirements | 2 | $150 |
| Travel and attend site visit | 4 | $300 |
| Prepare takeoff and production plan | 5 | $375 |
| Gather and compare supplier quotes | 3 | $225 |
| Obtain insurance and surety information | 2 | $150 |
| Prepare forms and references | 2 | $150 |
| Review pricing, addenda and submission | 4 | $300 |
| Staff-time subtotal | 22 | $1,650 |
| Travel and other direct expenses | Not hourly | $150 |
| Total pursuit cost | 22 | $1,800 |
Use an hourly figure that reflects the employee’s cost to the business. If your estimating department is already in company overhead, avoid subtracting the same expense twice when reviewing company-level results. For deciding where to spend the next 22 hours, the time still has an opportunity cost.
Keep reusable company information ready: current licenses, reference contacts, project descriptions, insurance contacts and a surety relationship when needed. Reuse the facts, then check every form against the current solicitation.
Stop early when a requirement rules you out. Spending two hours to discover that your company cannot satisfy a required license is better than discovering it after a full takeoff. The bid qualification and winning guide helps structure that first review.
Worked bid values for four trades
A six-figure award can justify the estimating expense at one margin and fail at another; the four examples below show the difference in dollars.
PorchRocket’s Bid Control data (October 2026) shows 57.2% of 1,294 recorded awards below $250,000. The sample is 74% Texas, and these are award amounts, which can include multi-year caps. A small contractor has reason to examine the scope before dismissing public work as too large.
The trade medians below come from those records. Each example uses a stated contribution margin, an assumed one-in-three win chance and a pursuit budget. The medians describe awarded work; they do not tell you the profit earned by its contractor.
| Trade | Median award and sample | Assumed contribution margin | Contribution if won | Assumed bid cost | Expected value at one-in-three odds |
|---|---|---|---|---|---|
| Roofing | $168,591; 48 awards | 20% | $33,718 | $1,800 | $9,439 |
| HVAC | $186,268; 114 awards | 18% | $33,528 | $2,200 | $8,976 |
| Paving | $474,502; 156 awards | 15% | $71,175 | $4,500 | $19,225 |
| Cleaning and janitorial | $181,251; 50 awards | 20% | $36,250 | $1,000 | $11,083 |
Calculations use the unrounded contribution figures; displayed results are rounded to dollars. Each example evaluates the full contract value and its delivery costs. Put recurring work on its annual schedule when planning cash and staffing.
For the roofer, the math is $168,591 × 20% ÷ 3 − $1,800 = $9,439. For the paving contractor, the larger award supports more pursuit expense. Check the bonding capacity before going further. Then confirm that the crew schedule and cash can support the delivery plan.
Test a less attractive case. At the same roofing contract value, a 10% contribution margin and a 10% win chance yield $1,685.91 before the $1,800 pursuit cost. Expected value becomes negative $114.09. Use that result to focus on jobs with a stronger margin or competitive position.
Then test your cost advantage. Perhaps the job is beside another project, your supplier quote is stronger, or the required system is work your crew already knows. Write down the dollar saving. If the advantage instead affects award probability, point to the qualification it satisfies or the comparable result that supports your judgment.
Use the full public award data report for more trade ranges, and government bid pricing to turn comparable records into a costed offer.
How should you estimate your chance of winning?
Start with comparable bid tabs and your own submission history, then test a lower probability before paying for a full estimate.
The updated records show a median of three bidders across 725 bid tabulations. About 61% of that sample is Texas. This is a starting point for competition research, not a measured win rate for a new contractor; parsed counts can also include a duplicate row, so read the comparable tab itself.
Use one-in-three only as a starting scenario for three equally likely bidders competing for one award. The first bids are the slow ones: portal setup and unfamiliar forms consume time before you have a record of responsive submissions. Budget for losing those early pursuits; three submissions do not entitle you to one award. Next check your delivery plan against the buyer’s requirements. Review your costs. Your own history will sharpen that initial probability as you complete more comparable pursuits.
Separate three questions:
- Can we submit a responsive offer and meet the buyer’s qualification requirements?
- If we qualify, are our price and other evaluated factors competitive?
- Is the owner likely to complete the purchase on the stated scope and schedule?
Check mandatory requirements first. Confirm the funding and scope before comparing your delivery estimate with relevant winning prices. Resolve the largest questions before approving the pursuit budget. That early work puts more estimating time behind opportunities you can win and perform.
What about a one-bidder job?
One bidder does not guarantee an award. The buyer still has to accept the price and qualifications, and it may cancel or rebid the purchase. A previous single response also tells you nothing certain about who will compete next time.
Look for the reason participation was low. Was the mandatory walk scheduled on short notice? Did the work require equipment few local firms own? Was the buyer asking contractors to hold a rate for several years? Those details can explain a thin field and reveal costs you would otherwise miss. Low participation deserves investigation before it deserves a higher probability in your worksheet.
You can also calculate the minimum odds needed to justify pursuit: bid cost ÷ contribution if won. In the roofing example, $1,800 ÷ $33,718 = 5.34%. Above that break-even probability, the modeled pursuit creates positive expected contribution. Compare it with the return available from your other suitable bids.
Stress-test the margin before trusting the result
A job that looks attractive at a 20% contribution margin can fail the pursuit test at 10%, even when its scope and award amount stay unchanged.
Use the roofing median of $168,591 from PorchRocket’s 48-award sample and the illustrative $1,800 bid cost. The table changes only the assumed contribution margin and win probability.
| Assumed contribution margin | Expected value at 10% win chance | Expected value at 25% win chance | Expected value at 50% win chance |
|---|---|---|---|
| 10% | Negative $114 | $2,415 | $6,630 |
| 15% | $729 | $4,522 | $10,844 |
| 20% | $1,572 | $6,630 | $15,059 |
Results are rounded to the nearest dollar. The 50% column is a sensitivity test, not a suggested starting win rate. Replace the planning margins and win probabilities with the inputs supported by your own estimate and bid history.
The table shows why an owner should question a single confident answer. At a 10% margin and 10% win chance, the pursuit loses money on an expected-value basis. At a 20% margin and 25% win chance, it has $6,630 of expected value. Same contract amount.
Resolve the assumptions that have the largest effect. If labor production is uncertain, inspect the site and review similar completed jobs. If supplier pricing is incomplete, get current quotes. If the win probability rests on a guess, read the buyer’s recent comparable bid results.
Margin and win probability can also move together. Lowering your selling price may improve your competitive position while reducing what remains after costs. Recalculate both inputs and the contract value. A price cut is worthwhile only if the resulting economics fit your business.
For example, at $200,000 revenue and $160,000 modeled costs, contribution is $40,000. Cutting the price to $190,000 reduces contribution to $30,000, a 25% reduction in the dollars left, even though the selling price fell only 5%. That discount costs $10,000.
Write down the base case. Then make it tougher. If the opportunity works only when every uncertain input goes your way, resolve the uncertainty before committing the full pursuit budget.
How much profit can you make on a government contract?
Calculate government-contract profit by subtracting the total costs of delivering and supporting the job from the revenue you will earn under its terms.
Define the cost base first. A gross margin after field labor and materials may still need to cover supervision, insurance, estimating, office costs, financing and warranty service. Calling that amount “net profit” will make a bid look better than it is.
Build the estimate around what the job requires:
- Labor hours, wage obligations and payroll burden.
- Materials, freight, waste and equipment.
- Supervision, access restrictions and mobilization.
- Subcontracted work and coordination.
- Project-specific insurance, bonding and administration.
- Cash carrying costs, warranty obligations and a supported risk allowance.
Margin and markup are different. If modeled costs are $80,000 and you add a 20% markup, the price is $96,000. The $16,000 left is 16.67% of revenue. To achieve a 20% margin on the same cost base, the price is $80,000 ÷ 0.80 = $100,000.
Keep that distinction visible when someone says “we need twenty points.” Ask whether the company means markup on costs or margin on the selling price. A small language error becomes a pricing error when repeated across several jobs.
Price the required base work to earn the return your company needs. For federal construction contracts containing FAR 52.243-4, changes and price adjustments follow the clause’s authority and notice process. Local contracts have their own terms. Record the approval and notice steps before treating a change as additional revenue.
Option years belong on a separate line
Count future authorized work at its expected contribution, weighted for the chance you receive it; keep the base commitment visible on its own.
In our Texas sample of 140 term or as-needed contracts with stated durations, 77.1% extend beyond one year when renewals are included, and the median total duration is 60 months. That measures available contract periods, not how often buyers exercise them. It supports building a five-year worksheet, not assigning a five-year revenue guarantee.
Read the ordering provisions alongside the base term. Check each option year. Record the committed work first, then the value and timing of each possible additional period. Label each amount in the worksheet. Is it an annual price? A full-term amount? An ordering ceiling?
For federal contracts, FAR 17.207 makes option exercise depend on determinations including available funds, continuing need, value and acceptable performance. State and local options follow their own contract provisions and legal authority. Read the renewal language.
Give each year its own row. Record revenue, staffing, wages, equipment replacement, contract administration and permitted price adjustments for each period. Then assign a probability to receiving that period’s work.
Price year one and each option year to support the required work. Model wage and material changes against the permitted adjustment. This gives you a contract worth keeping when the buyer exercises its next option.
Keep change orders on a separate opportunity line until the buyer authorizes priced work. A legitimate extra roof section or added service location can increase revenue, but it also adds labor, materials, supervision and risk. Count the expected contribution from the change, not its full selling price.
The same logic applies to the next job from the same agency. Good performance can create a relevant reference and a better understanding of the facilities. Any new purchase still needs the buyer’s authorized procurement route.
What could one public customer be worth over five years?
One public customer’s five-year value is the contribution from work you expect to retain or win, less acquisition and account costs, with each future year assessed separately.
Start with an award amount. PorchRocket’s award records include a $72,240 one-year cleaning contract for City of Pflugerville city hall, library and recreation-center facilities, awarded to Austin Professional Cleaning in August 2025.
For a separate five-year customer model, use that $72,240 annual price with these assumptions: you have won year one, maintain a 20% contribution margin after account costs, spend $1,200 acquiring the job, and assume an 80% conditional chance of continuing each following year solely to demonstrate the calculation. That retention rate is not measured in our records; replace it with evidence from the contract and your own account history.
| Year | Chance of reaching that year after the first win | Probability-weighted revenue | Probability-weighted contribution at 20% |
|---|---|---|---|
| 1 | 100% | $72,240.00 | $14,448.00 |
| 2 | 80% | $57,792.00 | $11,558.40 |
| 3 | 64% | $46,233.60 | $9,246.72 |
| 4 | 51.2% | $36,986.88 | $7,397.38 |
| 5 | 40.96% | $29,589.50 | $5,917.90 |
| Total | Five-year scenario | $242,841.98 | $48,568.40 |
Year three uses 0.80 × 0.80, because the scenario requires continuing through two renewals. Subtract the $1,200 acquisition cost once, leaving $47,368.40 of expected five-year contribution. The figures are nominal dollars, without discounting later cash flows to today’s value.
Before winning year one, the initial win chance must also enter the calculation. At one-in-three odds, the expected pursuit value is $48,568.40 ÷ 3 − $1,200 = $14,989.47. Use that before-award value when deciding how much to invest in pursuing the account.
If all five years happen at those same economics, revenue totals $361,200 and contribution after the acquisition cost is $71,040. That full-retention case is an upper scenario under fixed prices and costs. It is not the revenue to put in a committed backlog.
A public reference has value too, especially when the next solicitation asks for similar work. Record the completed scope, size, schedule and permitted reference contact. Use that reference to qualify for the next suitable project and evaluate that new pursuit on its own economics.
How does one public win help you earn the next customer?
A finished job supplies evidence for the next buyer who asks whether you have handled a similar scope, especially when experience is a qualification requirement.
Build that record while performing the contract. Save the agreed scope, important dates, approved changes, closeout documents and the information you are allowed to share about the completed work. Ask the buyer who can serve as a reference and which contact details to use.
Then write a short factual project summary. Describe what your crew delivered and the site conditions it handled. Record whether the work met the completion requirements. Keep the proof. A clear account of occupied-building roof work or reliable recurring cleaning is stronger than a page of broad claims about quality.
Keep a one-page job record ready for the next packet. For an occupied-building roof replacement, record the roof system and area, how access was controlled, the contract dates, and the approved final amount. If the next buyer wants three similar projects, one excellent reference still leaves two slots to fill. Check that requirement before paying for a takeoff.
For an owner, the lesson is to research the buyer as well as the single job. Which other facilities does the agency operate? What repairs or service needs appear in its plans? What qualifications will the next package require?
Keep future purchases attached to their own process. A relevant reference can strengthen a response when experience is evaluated. Familiarity with the buildings can improve your estimate. Each new opportunity still needs a supported price and the required submission.
Use the first win to improve the operation too. Compare recorded labor with the estimate. Review supplier performance separately, then check whether invoices were accepted on the first submission. Better cost knowledge helps the next bid, including work for a different city or district.
I would give a reference no separate dollar value in the bid worksheet unless I could explain how it changes a later pursuit. Otherwise, the same hoped-for benefit can get counted twice.
How much does a nearby service route add to contract value?
A nearby public service account can add value through shared travel and supervision, letting your company keep more of the price it earns.
Location belongs in the cost estimate for recurring services. Map the new sites against existing accounts. Map the equipment trips. Assign a supervisor and count paid time for each service day, including travel between buildings that cannot share the same access window.
Use a worked example at the $72,240 annual value of the Pflugerville cleaning award. For the hypothetical company in this example, assume delivery costs of $57,792. That leaves $14,448 of annual contribution, a 20% margin before remaining overhead and tax.
Now assume that grouping the new work with a nearby route saves three loaded labor hours each week. At an assumed $40 per hour over 50 service weeks, the saving is 3 × $40 × 50 = $6,000 per year.
| Annual account measure | Separate route | Combined nearby route |
|---|---|---|
| Contract revenue | $72,240 | $72,240 |
| Modeled delivery costs | $57,792 | $51,792 |
| Contribution | $14,448 | $20,448 |
| Contribution margin | 20% | About 28.3% |
The same selling price now leaves $6,000 more in the business each year. Five years of the same saving would add $30,000 to the account’s full-term contribution. Use the required service calendar and loaded labor cost when testing your route.
This is an alternative to reaching for a discount. Cutting the $72,240 price by 10% would give up $7,224 in annual revenue. Improving delivery efficiency can protect the price while making the account more valuable to your company.
Check the staffing plan before banking the saving. Check the service windows against crew availability. Can the assigned supervisor cover the sites without another trip? Put extra visits on the calendar too, including periodic floor care or seasonal grounds work.
The same idea applies to construction. A job near your suppliers, yard or another suitable project can reduce the travel and mobilization you must price. Capture the measured saving in the estimate and use it to build a competitive offer with a healthy margin.
Start by browsing open Texas cleaning bids or the work for your trade. Look for the customer whose location strengthens the operation you already have. That is a direct way to grow revenue and contribution together.
How do public payment terms help you plan cash flow?
Public payment terms give contractors a defined invoice process and legal payment obligations to use when scheduling cash from completed work.
The attraction is a defined process: an authorized scope, an agreed price, an identified invoice route and a payment obligation you can document. Build your operation around completing that process correctly.
Payment rules vary by state and buyer. Use these Texas and Virginia examples to see which dates belong in your cash plan:
| Jurisdiction | General rule in the cited provision | Detail that affects cash planning |
|---|---|---|
| Texas, Government Code 2251.021 | Covered payments generally become overdue on day 31 after the latest of receipt of goods, completed services or invoice receipt | Certain political subdivisions whose boards meet monthly or less often use day 46 |
| Virginia localities, Code 2.2-4352 | Use the contractual due date; without one, the default is no more than 45 days after receipt of goods or services or the invoice, whichever is later | A contract can establish the payment date; the statute also addresses invoice defects |
The Texas statute also provides for interest on covered overdue payments. Virginia’s local-government provision requires notice of defects or improprieties that would prevent timely payment. Check the applicable provision alongside the contract and set your billing process up to meet it.
Ask the buyer which documents make an invoice acceptable. Confirm the purchase order, required supporting records, receiving contact, billing frequency and payment route before mobilizing. Save proof of submission and acceptance.
Then stress-test the cash. If an illustrative cleaning operation spends $12,000 per 30 days on delivery and must fund 45 days before receiving cash, it needs $18,000 to bridge that period, assuming costs accrue evenly. Arrange that $18,000 bridge as part of preparing to deliver the contract.
Retainage, when required, adds another timing issue: part of earned payment is held until the contract’s release conditions are met. Model that withheld cash separately from profit. The bond guide helps distinguish bonding requirements from available working capital.
What should go on a bid/no-bid scorecard?
A bid/no-bid scorecard tests eligibility first, then compares delivery fit, economics, cash needs, competition and pursuit effort using facts someone can verify.
First apply hard gates: required license, mandatory visit, required experience, submission eligibility and the ability to obtain required bonds and insurance. If a mandatory condition cannot be met, stop or identify a permitted teaming route before spending more.
Then score the opportunity using the suggested management tool below. Record the evidence behind each score so the decision is clear to the owner and estimator.
| Factor | 0 points | 1 point | 2 points |
|---|---|---|---|
| Scope fit | Unfamiliar work | Some new requirements | Repeat work your crew knows |
| Crew and schedule | Cannot cover the window | Needs a credible staffing fix | Capacity already available |
| Contribution | Negative or unsupported | Positive with unresolved costs | Supported by an itemized estimate |
| Working capital | Funding gap cannot be covered | Financing needs confirmation | Cash plan is funded |
| Competitive position | No credible path to win | Mixed evidence | Comparable records support the case |
| Pursuit effort | Budget exceeds expected value | Heavy but manageable | Focused response within budget |
| Customer potential | One poor-fit job | Possible future fit | Documented recurring need or relevant references |
For this seven-factor version, 11 to 14 points suggests a strong pursuit, 7 to 10 calls for resolving the weak areas, and 0 to 6 suggests passing. Any failed hard gate overrides the total. Use these suggested bands consistently and adjust them as your own completed pursuits show which factors matter most.
Write one specific sentence beside every score, such as “The first two payroll cycles and material deposit fit within available funds.” Assign unresolved items to a person and a deadline.
Optimism needs evidence. Two people should be able to look at the same facts and understand why the owner approved the pursuit.
How can you improve bid value without cutting your price?
Cutting six hours of avoidable paperwork improves the pursuit calculation without reducing your selling price; choosing a familiar scope can also reduce estimating uncertainty.
Start with wasted hours. Reduce unnecessary estimating hours. Improve the contribution through better production planning. Choose jobs where your qualifications fit. Find work early enough to obtain firm supplier quotes and resolve scope questions.
For example, reducing bid cost from $1,800 to $1,200 raises expected value by $600 without changing price or win odds. Avoiding one unsuitable pursuit saves the whole cost you would have spent on it.
Track those savings with recorded hours. Keep a small bid log containing the agency, scope, contract amount, estimated contribution, pursuit hours, expected odds and final outcome. Review completed, comparable pursuits together, including the jobs you declined.
When a result surprises you, investigate the right question. A very low winning price may reflect different scope, selected alternates, a term misunderstanding or a competitor’s cost advantage. Follow the scope and cost differences until you find a change worth making for the next estimate.
Use the government bid source map to improve coverage, then narrow aggressively. The goal is a manageable set of suitable opportunities with enough information to make a sound decision.
Set a monthly limit on pursuit spending
Follow buyers that repeatedly need the work you do: cities with public buildings, schools with aging systems, and agencies with recurring cleaning or grounds requirements. Keep current bids in one working list with upcoming projects. Add existing contract end dates.
Give every worthwhile pursuit an owner and a next action. One needs an insurance check, another needs a supplier quote, and a future project needs a follow-up after its next budget decision. The list earns its place when it tells your team what to do this week.
Set a monthly estimating budget and review it against contribution from completed work. A small company can begin with a few carefully chosen bids and increase the pace as its reusable records, cost history and references improve. An established bidder can use award history to concentrate effort on the buyers and scopes where its operation is strongest.
Then plan the next capacity step. Discuss larger jobs with your surety producer. Arrange the working capital, then assign supervision. Do this before committing the crew to a larger package.
Bid Control gives that process a clear starting point: checked work in your area, early project records, the previous winner and amount, and help pricing and assembling the response. Keep the pursuit budget beside that list so a busy month of bidding does not consume the cash needed for work already underway.
Bid Builder keeps the pursuit cost visible
Bid Builder helps an owner spend less time re-entering company information, leaving more of the pursuit budget for checking quantities and testing the delivery estimate.
Start with a job you can cost. The Bid Control board brings the bid papers and deadline together with past winners and award amounts. Listings are reviewed before reaching your board, so you have a starting point for the qualification check. Read the current packet before approving the estimating hours.
The roofing board and cleaning board narrow the search to work you recognize. A previous award can help establish scale, but compare its term and quantities before borrowing the amount. A three-year ceiling and a one-year service price cannot occupy the same cell in your worksheet.
Choose the plan around the part of bidding that consumes your time:
- Bid Board: Find work in your trade and area, then use previous awards to check contract size before authorizing a takeoff. Early signs in budgets and meeting minutes help you plan future estimating capacity. Keep unposted projects out of the near-term revenue forecast.
- Bid Builder: Reuse your Bid Passport company file for the buyer’s forms, follow the required steps, and review past winning prices on similar jobs. Text a bid expert when a requirement stalls the response. This fits an owner who handles the estimate and wants fewer hours spent rebuilding the packet.
- Bid Team: Work with Rafael on which jobs justify the effort. The team plans each bid with you and handles the paperwork, including addenda, notary pages and portal accounts, one bid at a time on agreed dates. You make the final call on your number, sign and send.
Measure the time saved on your next few submissions. Separate company setup from job-specific estimating: a saved insurance certificate can carry forward, but the takeoff for another roof cannot. Use the recorded hours to revise the pursuit-cost assumption instead of assuming every later bid will be cheap.
To try the worksheet on a current opportunity, browse open Texas roofing bids, or bring a packet to a 15-minute call with Rafael. Write down the committed revenue, contribution if won, probability range and maximum pursuit budget. If the case works only with unapproved extras or every renewal exercised, go back to the estimate before spending the next evening on forms.
Quick answers
Is bidding on government contracts worth it for a small company?
Yes, when the work fits your crews and the expected contribution exceeds the cost of competing. Start with a familiar scope, a buyer you can serve and a funded cash plan. Use the first completed contract to build a reference and improve your estimate for the next suitable public job.
What is the formula for the expected value of a bid?
Use contract value × contribution margin × probability of winning − bid cost. Contribution is the money remaining after the delivery costs you include in the model. Keep the definition consistent. For a $200,000 job at 20% contribution and 25% win odds, with $2,000 to bid, expected value is $8,000.
What profit margin should I use for a government contract?
Use a margin supported by your own itemized job costs. Include labor burden, materials, supervision, required insurance and bonds, administration, financing and other costs relevant to the scope. Calculate what remains after those expenses, then account for remaining company overhead and tax. Update the estimate with recorded costs from completed comparable work.
Does one bidder mean the contract is yours?
No. A buyer can reject the offer, cancel or rebid even with one response. A single-bidder result is a reason to research the buyer and scope. Read the previous award, confirm the requirements and build a fully costed price for the next purchase. Your job is to submit an acceptable offer the agency can award, with the qualifications and delivery plan to perform it well.
How much does preparing a public bid cost?
The worked example here costs $1,800: 22 hours at $75 plus $150 of expenses. Budget your own staff time, travel, document charges and outside estimating before starting. Your cost depends on the scope and response. Reuse company records and check each solicitation's specific scope and forms.
Do government customers always pay within 30 days?
No. Payment timing depends on the buyer and contract. Texas generally makes covered payments overdue on day 31 after the latest statutory trigger; certain political subdivisions whose boards meet monthly or less often use day 46. Virginia localities use the contract date or a default of up to 45 days after the later of goods or services receipt and invoice receipt. Submit properly supported invoices through the designated process.
Should I count option years in the value of a bid?
Yes, but separately from committed work. Count the expected contribution from option years, using their contract prices, projected costs and a supported probability of receiving the work. Check how the buyer exercises each option. Show the first committed period on its own and price every later period to support the required work.
How can I choose between two bids with positive expected value?
Compare expected contribution per estimating hour, then check crew timing, cash needs and the value of work you would displace. Give the next estimating slot to the opportunity with the strongest economics and delivery fit. A smaller familiar job can produce more expected value per hour and fit your existing operation more comfortably.
Sources used in this guide
Sources are linked at the claim they support and collected here for auditability. Vendor features and prices can change; verify them before purchasing.
- Texas Government Code Chapter 2251Texas Legislature: Sections 2251.021 and 2251.025 govern payment timing and overdue interest, with exceptions elsewhere in the chapter; verified October 2026.
- Virginia Code section 2.2-4352Virginia General Assembly: Local government payment date, default 45-day rule and invoice-defect notice; verified October 2026.
- FAR 17.207: Exercise of optionsU.S. General Services Administration: Funding, need, value and performance determinations for exercising federal contract options; verified October 2026.
- FAR 52.243-4: ChangesU.S. General Services Administration: Construction changes, notice and equitable-adjustment process for contracts containing this clause; verified October 2026.
- Is submitting to government RFPs worth it?Reddit, r/consulting: Reader questions about proposal effort and opportunity selection; verified October 2026.
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