Commercial Jobs

Value Based Bidding:

The competitive and negotiated bidding processes are not new. Competitive or hard bidding has been and is currently more prevalent in the commercial construction industry. However, in the last 20 years, evolutionary changes have occurred in the subcontracting and architectural fields of commercial construction. The result has been a depression in prices for competitively bid jobs. A need has arisen for a change in the bidding process. The negotiated bid process needs to be seriously considered as an alternative process in today’s environment.

At Cahoon we do not believe in low-bid procurement of services and will rarely toss our hat into that ring, the selection of a builder is often based on several factors such as quality, availability, reputation, resume, and references, and these criteria may or may not include price. From preliminary interviews, the authors conclude that there is a need for a systematic method of evaluating potential job opportunities and determining fair market prices. Cahoon subscribes to this hybrid model, Value-Bidding, refocuses the competitive bidding model from a fee-based selection criteria to a value-based selection criteria. Value-Bidding utilizes an established marketing research methodology, conjoint analysis, to establish the probability of winning based on multiple factors. The resulting analytical model enables engineers to analyze market conditions, evaluate client priorities, systematically track competitors, and optimize proposals, while maximizing the probability of winning, maximizing profit, and optimizing price

Value Bidding is a Cahoon Practice:

A Cahoon Contract bid will introduce a whole spectrum of value to a project and not just price alone.  Because in the end, as we all know, the lowest prices typically ends up costing you more  than the higher ones.