Public bids... why are so many bid so low?

Discussion in 'Landscape Maintenance' started by Ramairfreak98ss, Mar 2, 2012.

  1. Ramairfreak98ss

    Ramairfreak98ss LawnSite Silver Member
    Messages: 2,210

    Sat in the bid opening for one of the local municipalities... There were 9 bidders they opened...

    There were two bids each, one included 30 week lawn mowing for the season, including trash duties "empty public waste cans, new bags & dispose in dumpsters" as well as restroom cleaning for the season. It didnt stipulate if those duties were daily, weekly, monthly etc.. but i'd assume they'd want the restrooms restocked and cleaned more often than once a week. Because we didnt bid until close to the end, and no one returned us a definite answer in time, we did not submit the bid.

    Second bid # was for lining/dragging/striping all the soccer,football, and baseball fields, there were six total sites, a mile apart from the main one, all in center town, the main site was about 110 acres, another was 22, and all the rest were only buildings with trimming maintenance on the main road and a park with a gazebo next to a creek, a "scenic park" area. Total of about 140 acres max.

    There were 10 baseball fields, 4 football fields, and 3 soccer fields... some of the soccer fields overlap the baseball fields, but theres a lot of open space in between many areas. We estimated just in paint and lime alone for the year would cost us $4500-5000... that might be low.

    Monday-Saturday between 2-5pm, yeah 6 days a week, you redo the baseball fields, touch up the soccer and football fields and redo all lines on soccer/football once a week... I would assume it would take a couple guys at least 1 to 1.5hrs a day, and 25 mins travel to/from shop so figure 2 to 3.5hrs x6 days a week plus supplies.

    Dragging the fields we could do with a small garden tractor and pull around chainlink fence with some weights and the 2nd guy would manually touch up small areas like batters box etc.

    So the low bidders were $12,000 and $7200
    $22,325 and $5,630
    $29,900 & $8,700

    I havnt even gotten to what i consider our "low bid" competition in the areas lol. Two local companies bid very close to each other, and i know one, "clintar" with green trucks, has outbid us on other municipal/school work two years ago at nearly half of our bid, and half of what the previous company was getting per season.

    Their bids were $34,500 and $36,400 clintar
    company #2 $32,500 and $36,500... how they were that close.. i doub't its a coincidence.

    Brickmans, $39,026.00 and $20,600.... which not sure why their 2nd bid portion was so low on that scope of work.

    I worked out most of the bid anyway, came up with roughly 2 full days, 3 man crew, leave trailer there one night even though its only a half hour from our shop. They'd be on the clock for roughly two 11hr days, minus hr for lunch each day, so 60 man hours to mow, trim, blow off, trash duties and "i was hoping" could squeeze in the public restroom duties at the end of day #2...

    My estimate was $54,000 mowing inc. trash duties., $3500 in mulch work, $13,500 cleaning restrooms, trim and pruning work inc. spring and fall cleanup... totals $72,600.. we havnt even gotten to the 2nd bid #.

    We have enough machines to have lots of guys mowing/working, but its not productive to really have more than a 3-4 man crew, ever... But we could put a 4th on this crew if we had to.

    I broke down everything to how many acres per hour we could mow wide open, semi wide open and not wide open, and with each machine.

    We would either have two 72" ferris zero turns or one 72" and one 61" machine going for nearly both full days, and one guy trimming/edging, alternating with mower guys every couple hours. We could put a 15' batwing mower on our JD tractor, but then would likely have to leave it there 24/7, switch to turf tires, and a $50k+ tractor w $12-14k mower attachment doesnt make sense for the contract price either.

    For the 3, maybe 4 man crew, i estimate gross billing at $900/day, since our two man crews can do $700+ in a 7-9hr day easy doing just basic residentials.

    If we cant get the restrooms done each week in those two mowing days, it would take 2 of our guys 3hrs total plus half hour each way, so 8 man hours on the clock to do all janitorial duties... this is if we could even handle it internally and not have to sub out to a janitorial company.

    8man hours week = $400 week
    Soap 1g, paper towes cleaners, etc. $another 1200 per season.

    At even brickmans highest bid of $39,000... that would mean we'd bill about $400 a day for all that work?

    My initial estimate for the lining/dragging etc was for two guys , 6 days a week, taking 6hrs on the sites including travel... i reduced it to 3hrs, because half hour each way and 2hrs work is probably doable.

    Thats still $43,200 for 6 man hours a day, x 6 days wwk, @40.00/hr x 30 weeks, plus $4500-5000+ in supplies. Again, highest bid was $36,400, lowest $5,630.00 LOL

    There were so many odd ball and low bids, that even the companies i consider low ballers were bitching and reviewing the bids, but its just two numbers, nothing to see broken down anyway.

    I'd be glad to hear any of your experiences on this type of work.

    Oh, and i'm not sure how the one 2nd company could even do this work because im positive they have two zero turns, all they do is lawns usually, a Dixon 48 or 61" and another machine thats probably a 60" mower too,, maybe a Husler water cooled or something. I'm worried two 72"s would take eternity let alone anything less :/

    Lowest bid was
  2. tailboardtech

    tailboardtech LawnSite Senior Member
    Messages: 390

    well i work for a municipality and can honestly say nothing surprises me anymore. we do contract inspections and ever since the economy went in the crapper i have red flagged at least 40 contractors for failure of there jobs (meaning they can no longer bid on county contracts ). no surprise these people are the one's that are 2000 and one was almost 10000 cheaper that all the other bids the county's never learn cheapest isn't always the best.
  3. Ramairfreak98ss

    Ramairfreak98ss LawnSite Silver Member
    Messages: 2,210

    Yeah, well you can estimate that it would cost the county a minimum of about $80,000 per year salary to pay two guys full time including benefits maybe, to handle this work and maybe some snow in the winter. But still, why would they entertain bids that are $30k or less when they know the bids should start at 50-60k?
  4. JB1

    JB1 LawnSite Fanatic
    Messages: 5,904

    i go with they are dumber than a sack of rocks theory.
  5. Dr.NewEarth

    Dr.NewEarth LawnSite Bronze Member
    Messages: 1,476

    A larger company spreads its overhead costs amongst more employees, making their hourly labour cost lower.

    On the other hand. There is a city lawn cutting contract that I know of that was granted for 158 thousand a year for many many years. Two guys from that company knew the price and under bid on the contract behind the owners back. They put in for 96 thousand, got the contract, bought a truck, trailer, big mower and other tools. After two years they were dead in the water.

    One of the problems with underbidding, besides the obvious just stated, is that the clients budget gets set low for the following years. That other money gets allocated to other things and it's hard to get it raised again.

    Other companies that are realistic about the cost of business and bid higher than the new budget lose out. Then the quality of work goes down, less gets done and so on....
  6. Ray_Lawns

    Ray_Lawns LawnSite Member
    from NE AL
    Messages: 125

    I was looking at a bid this morning and was going to take a ride and start planning to bid untill i did some research. It is for maintenance on a levee that totals 32 acres. The bids for the last time were 2,245, 4,150, 18,735, 35,440 and 35,760. Two grand for 32 acers on a levee that has to be cut biweekly is insane.
  7. doyles

    doyles LawnSite Member
    Messages: 133

    you got to remember. when it comes to city or county bids these guys can get a list of current bid prices. there is no figuring out prices they drive by the area for bid look at what it is going for cut that price by a quarter put there bid in they get it. and this keeps repeating untill its not even worth looking at the bids.
    i think when something goes up for bid you should not be able to see the current bid prices. this way you would have to look at the job and figure out the your cost. this way it might bring the bid prices closer together.
  8. doyles

    doyles LawnSite Member
    Messages: 133

    this is another good example of not knowing how to bid.
    the contract went for 158 thousand the to guys found the price out
    and they cut 62 thousand of the current bid price. no figuring out.
    people don't think of the bigger pitcher insurance,gas,maintains
    don't forget the big one TAXES
  9. corey4671

    corey4671 LawnSite Silver Member
    Messages: 2,931

    Two things I don't even bother to bid anymore. Government and cemetaries.
    Posted via Mobile Device
  10. White Gardens

    White Gardens LawnSite Fanatic
    Messages: 6,776

    Just baffles me.....

    I just don't see how anyone thinks that they could come close to making a profit on something like that.


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