As a construction company or contractor, the first step in securing more projects is to craft a compelling construction proposal. This important document not only serves as one of the biggest selling tools for your construction company. However, participating in construction project bids can be a stressful journey. Crafting precise construction bids and submitting them to clients requires dedicated time, resources, and effort.
To speed up the proposal creation process, we suggest having a construction proposal template ready. This proposal template should include all the essential elements of a winning proposal, so you don’t have to start from zero and should also be customizable, so you can make it your own and add any changes you’d like.
In this blog, we will teach you how to write an effective construction proposal that stands out from the competition. We will also prove you with examples of construction proposals, top tips to boost your chances of winning the bid, and a downloadable construction proposal template.
Contents hideA proposal for construction is a formal document submitted by a construction company or contractor to a client or project owner. Its purpose is to outline the details of a construction project, including the scope of work, cost estimates, timeline, materials, and other relevant information.
The proposal serves as a key communication tool between the construction firm and the client, providing a clear understanding of the project’s objectives and how it will be executed. Creating a construction proposal is easier when you have an effective construction proposal template you can customize.
The term “construction proposal” is often used interchangeably with “construction bid” and “construction bid proposal.” However, a bid differs from a proposal. Proposals include all the details found in estimates, quotes, and bids but go beyond simple approximations. They are tailored and specific, highlighting the unique value that a construction company can provide to a potential client.
A construction proposal is used as a persuasive tool to showcase the construction company’s capabilities and convince the client that they are the right choice for the project.
When submitting a proposal, you are likely to face competition from other companies that want to win a client’s business. Therefore, it is crucial to use a compelling construction proposal template and invest time in writing the details of the proposal to effectively showcase the value you can offer.
On the other hand, a construction bid is used by the project owner to compare different offers from various contractors. After evaluating the bids, the project owner can select the most suitable and competitive bid to award the construction contract.
Bids are specifically common in the construction industry, especially for larger projects. Sub-contractors frequently submit construction bids to general contractors to undertake specific portions of the project.
To summarize, bids and proposals are very similar, but proposals tend to be more detailed. Both are useful in different situations, and people will continue to use them interchangeably.
Construction proposals are essential for several reasons. A construction proposal is not only about winning clients and making money; it’s also a way to show off your company. It reflects both what makes your company special and its overall image. A construction proposal plays a crucial role in the construction project’s success and the relationship between the construction company and the client. Here are some key reasons why construction proposals are important.
Highlighting the construction company’s brand identity in the proposal reinforces its reputation and credibility. Using custom brand assets, colors, and other customized and personal elements can make a difference between winning or losing a potential client.
A strong brand identity, built on trust, reliability, and quality, can make you stand out from other bidders and instill confidence in the client and reassure them that they are choosing a reputable contractor.
A well-written construction proposal provides a clear and detailed outline of the project’s scope, timeline, and cost. This ensures that both the construction company and the client have a shared understanding of what will be delivered and at what cost.
You should define client expectations and be straightforward about what you are going to provide for the client. A comprehensive construction proposal demonstrates transparency in the pricing and cost breakdown. When the client sees a detailed estimate, they are more likely to trust the construction company, leading to better client-contractor relationships.
The proposal serves as a foundation for project planning and execution. It helps the construction company allocate resources, plan schedules, and coordinate tasks effectively.
For clients, reviewing proposals from different construction companies allows them to compare offerings and select the best-suited contractor for their project. The proposal becomes an important document in the client’s decision-making process.
A construction proposal will typically include:
Below, we’ll go into more detail on what information to include in each section.
Additionally, here are some optional construction proposal elements to consider:
Equipment: This is useful for contractors that require heavy equipment on the job.
Writing a construction proposal requires careful planning and attention to detail to ensure that all the necessary information is included. Here’s a step-by-step guide on how to create winning construction proposals:
The first part of a construction proposal is to highlight the details of both parties involved. Identify the parties involved in the construction project, including the construction company (contractor) and the client (owner).
Make sure to include both your contact information and the clients on the first page of the proposal. Include both parties’ names, logos, addresses, phone numbers, email, and any other relevant contact details.
Describe in detail the scope of work that the construction company will undertake. Providing a detailed description of the work you’ll be performing is crucial in any construction proposal. This section should outline all the tasks and activities to be completed. We suggest dedicating a good amount of time to this section, ensuring it is highly detailed and comprehensive by listing all the services and tasks you offer.
If you plan to use a sub-contractor for certain tasks you won’t be performing, make sure to include their information and estimated cost, clearly outlining the responsibilities of each party involved. These will be the “exclusions” to the scope of work, which includes work that will not be done by the general contractor.
A thorough scope of work prevents any misunderstandings or unexpected tasks that may arise if it’s not properly outlined.
A realistic timeline is essential for successful project management. Present a realistic and detailed work schedule, including start and completion dates for each phase of the construction project. Make sure to include the time needed for obtaining permits and approvals, as well as the steps of work and completion. Remember to account for potential delays due to weather, delivery services, and other external factors beyond your control.
Identify any relevant authorities or regulatory bodies that the construction project must comply with, such as building codes or permits required. The relevant authorities in a construction project refer to the roles and responsibilities of both your crew members and anyone else with decision-making power. This includes individuals at local municipalities, affiliates, and partners involved in the job.
Also known as administrative breakout, the cost breakout section should provide a comprehensive breakdown of the estimated costs for the entire project. This should include:
It’s essential to have a payment schedule outlining how and when the client will compensate you for the work you are performing.
Normally, the cost should be stated on the first page of the proposal. If your proposal extends beyond one page, include the total cost on the first page and the detailed breakout on the page where it falls naturally.
In this section, outline the legal and contractual terms and conditions that both parties must agree to before starting the project. This section may cover:
The more specific and clear the conditions, the smoother the outcome will be. Both parties must acknowledge and accept the scope of work, costs, and terms in writing to avoid potential legal disputes later in the project.
Specify any warranties or guarantees offered on the completed work. Clearly state the duration and coverage of the warranty. In this section, you outline the specific work you are responsible for fixing and the conditions under which you will do so. Additionally, it clarifies the aspects you are not liable for.
Lastly, there’s the acceptance of the proposal. Leave space for the authorized representatives of both parties to sign the proposal, indicating acceptance of the terms and agreement to move forward with the project. This will happen if the project owner is satisfied with the construction proposal. The signatures serve as the foundation for a legally binding document between the two parties, confirming their agreement to the terms and conditions specified.
Here are some construction proposal examples to help you get an idea of what your construction proposal should look like.