Corbelworks · Bid Decision Tool

RFP Bid Go / No-Go Scorer

Decide whether to chase a public bid or private RFP before you burn estimating hours. Score fit and risk, then check whether the expected value of bidding is actually positive.

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Part of the contractor RFP bid decision guide — fit/risk scorecard and expected-value bid math.

1 · Fit & risk scorecard

Rate each factor 1–5. Weights are fixed to a common contractor bid/no-bid checklist; the composite is a weighted average on a 100-point scale.

2 · Expected-value math

A high fit score is not enough. Bidding only makes sense when EV = P(win) × job profit − bid cost − opportunity cost is positive.

What you think you would win at — your likely bid, not the owner’s budget fantasy.
$
Profit after labor, burden, materials and overhead. Be honest — 8–15% is common on competitive public work.
%
Your honest P(win). With 4 equal competitors and no relationship edge, start near 20–25%.
%
Estimator hours × burdened rate + printing, bonding prep, travel to pre-bid. Money you spend whether you win or lose.
$
Profit you forgo by tying crew calendar to this job instead of a better one (0 if you have idle capacity).
$
Used only as a sanity check against your P(win). Leave 0 if unknown.
Method, formulas & sources

Why most “should we bid?” gut calls fail

Estimating time is a sunk cost the moment you start. The correct decision uses two independent filters:

  • Fit/risk score — qualitative go/no-go on whether this job belongs in your book (scope match, documents, payment risk, capacity).
  • Expected value — whether the probability-weighted profit covers the certain cost of bidding plus any calendar opportunity cost.

Either filter can kill the bid. A dream-margin job with a 5% win chance and a $6,000 estimate package is often a no-go; a smaller job with strong fit and idle capacity can be a clear go.

Scorecard

Each factor is scored 1–5. The composite is:

score100 = 100 × Σ(weighti × ratingi) / (5 × Σ weighti)

Default thresholds used by this tool:

  • Go — score ≥ 70 and EV > 0
  • Conditional — score 55–69 with EV > 0, or score ≥ 70 with EV near zero (tighten scope, ask for addenda, or cut bid cost first)
  • No-go — score < 55 or EV ≤ 0

Factor weights (normalized to sum 100): scope/experience fit 18, document completeness 12, owner/payment risk 16, competition intensity 12, margin realism 14, location/logistics 8, capacity/backlog fit 12, commercial/contract risk 8. These mirror common contractor bid/no-bid checklists used in construction-management practice; adjust your judgment inside the 1–5 ratings rather than inventing new weights every time.

Expected value

  • Job profit if won = contract value × net margin.
  • EV = P(win) × job profit − bid cost − opportunity cost.
  • Bid cost and opportunity cost are paid (or forgone) win or lose — they are certain costs, not probability-weighted.
  • Break-even win probability = (bid cost + opportunity cost) / job profit. If your honest P(win) is below that line, do not bid.
  • Sanity check: with n equally credible competitors and no relationship edge, a naive prior is ~1/(n+1). If your entered P(win) is more than ~2× that prior, you should be able to name a specific edge (relationship, unique means/methods, incumbent knowledge).

Sources & assumptions

  • Expected-value decision rule for irreversible spend under uncertainty is standard decision analysis (Raiffa; Clemen & Reilly, Making Hard Decisions).
  • Contractor bid/no-bid factor sets appear across construction-management literature and industry practice guides — e.g. PMI construction / AGC estimating guidance, and survey-based bid/no-bid factor studies in the Journal of Construction Engineering and Management tradition (owner, competition, risk, capacity, and document quality consistently rank high).
  • Win-rate priors from equal-competitor auctions follow from elementary probability (1/(n+1) with n rivals under exchangeability); real rates deviate with relationships, prequalification, and bid shopping.
  • Defaults are illustrative. Public low-bid work often clears thinner margins than private negotiated work. This tool is a decision aid, not legal, bonding, or accounting advice.

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