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Shop Talk with Steve
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Estimator's Corner
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The Project Manager
Steel Advice - The Fabricator's Resource
Dedicated to support the steel fabricator with real world solutions to real world problems.
October
  2011
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Estimator's Corner
The bid letter is the only document that indicates the steel fabricator's interpretation of the contract documents. Writing a good bid letter is important to every project as this letter will set the stage for the whole course of the job.
 
The proposal letter protects you, the company you are working for and your potential customer. It is a legal document and should be incorporated into any purchase order or contract agreement entered into without exception, for it specifically identifies the information used to produce the pricing.

All the documents and drawings that are reviewed during the process of creating the estimate need to be listed including the release dates, revisions and addendums that were incorporated. This is important as any later revisions or addendums may affect the pricing given at bid time, and only your bid letter will verify that for you.

Particular attention should be paid to the inclusions or exclusions of the miscellaneous items found at the architectural drawings. Often this is where ambiguities are found that can lead to disaster. Even the smallest, seemingly insignificant detail may lead to a large dollar item. Great care should be taken to identify these at the bid letter.

Don't worry about the letter being too long or too detailed. Tedious as this work is, it is very necessary. It will be the item or items that are not listed at the inclusions or exclusions of the bid letter that will cause problems. Guaranteed.

The Bid Letter
The Devil Is In The Details - Making Allowances For Items Not Shown
Almost every project has requirements for the steel fabrication that is not shown at the drawings and specifications. The statement "Any and all items, whether or not shown or indicated in the contract documents shall be included" may be found in any Miscellaneous Metals Section 05500 in the Division 5 specifications. What is the steel estimator to do with such a statement?

The designers don't necessarily know everything that may be required with regard to fabrications for every project, so the inclusion of the statement "any and all item whether or not shown or indicated..." is the way for the designers to cover themselves for all the things they are not sure about.

Specifications are written in specific and general terms. It is those general terms that will get us into trouble. If the estimator's bid letter is written specific to each project the solution is simple. Add to the list of exclusions all the items listed at the specifications that are not part of the project, including this 'any and all items" statement.

Unknown or unforeseen items can and do come up during the course of fabrication. It is expected that the steel fabricator will have included everything necessary to provide a complete job. If the list of exclusions is comprehensive, then the project manager will have an easier time getting paid for extra work. It will be items that are not identified and not specifically excluded that may be costly and will prove to be difficult to collect for.

We do not get to be low bidder by assuming anything. We cannot make allowances for items that are not shown or indicated, for if we did, we would never get a job.

Granted, there are some things that we know as fabricators that we need to do, and it only makes sense to put the money in our quote to cover such things. An example of this would be nail holes for embed angles and plates, or erection holes for bracing, since these items are an understood trade practice and the designers generally do not put these in their details.

Be careful how the bid letter is written, and be clear about what you do and do not have in your quote. Extra time invested in developing the proposal will keep your company from providing items or performing work that was not included in your estimate.
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