How Low Bids Affect Project Costs

LOW BID After more than three decades in this business, we’ve learned that the lowest bid often comes with the highest risk. Here’s what we’ve seen happen when price becomes the only priority: 1. Quality takes a hit. Low bids usually mean shortcuts—cheaper materials, rushed labor, or inexperienced crews. That leads to weak results, safety issues, and expensive rework later on. 2. The extras start piling up. That “low” number often leaves out key scope items. Change orders, added services, and delays show up fast—and erase any savings. 3. The schedule slips. Some low bidders simply don’t have the manpower or equipment to stay on track. Missed deadlines cause real disruptions to the rest of the project. 4. Vendor reliability becomes a problem. We’ve seen low bids from subs or suppliers who aren’t financially stable or don’t follow through. That puts your project at risk for compliance failures or even abandoned work. 5. You end up buying it twice. Many of the lowest bids are built for the short term—just enough to get through inspection. But that kind of work doesn’t last, and you’re back out to bid sooner than you should be. 6. It costs more in the long run. Focusing only on price can limit your flexibility, strain your vendor relationships, and drive up total lifecycle costs. We understand budgets matter. But experienced, qualified contractors build value—not just low numbers. Choose wisely, or you may pay for it twice.

Your Cost-Cutting Strategy Is the Most Expensive Decision You’re Making Every IT leader wants to cut costs on tech rollouts. But picking the lowest bidder? That’s how projects become the most expensive mistake you’ll make. Here’s how it happens: You’re rolling out a POS system to 500 locations. Two vendors bid: ✅ Vendor A: Costs 30% more but has a proven track record, a vetted contractor network, and real-time quality control. ❌ Vendor B: Cheaper—but no data on performance, no verification process, no oversight. You choose Vendor B. Then reality hits: 🚨 Missed deadlines. 🚨 Inconsistent installs. 🚨 Stores dealing with outages and rework. By the end, you’ve spent more fixing mistakes than you ever saved—and burned trust along the way. Want to avoid this nightmare? Before hiring a rollout partner, ask these 3 critical questions: 🔹 Performance Data: Can they show real metrics on completion rates & contractor rankings? 🔹 Quality Control: Do they vet contractors and verify work before sign-off? 🔹 Real-Time Visibility: Will you know what’s happening before problems escalate? If they can’t answer these with proof, you’re not hiring a partner—you’re rolling the dice. The best IT leaders don’t pick the cheapest option. They pick the best investment—the one that delivers on time, at scale, and without the chaos. If you’re scaling tech deployments and want them done right the first time, let’s talk. #ITLeadership #TechDeployments #FieldService #EnterpriseIT #Scalability

The cheapest rate is never the best deal. A $75 freight “win” just cost a broker over $12K. If you skip vetting for reliability, you’re gambling. Here’s why low bids can destroy trust — and profit. I watched a shipper high-five their team over saving $75 on a cross-country load last month. This morning, that same load is stuck 800 miles from delivery, the receiver is furious, and the "savings" evaporated ten times over. Here’s the raw truth about chasing the absolute bottom dollar in freight. It often starts with pressure. Quarterly targets. Budget cuts. Procurement demanding lower bids. And a belief that transportation is purely a commodity – lowest price wins. So they squeeze. Push brokers for unsustainable rates. Award lanes based on pennies, not performance. Ignore warning signs from carriers they don't know. And they celebrate the initial "win" on the spreadsheet. Then reality hits: The bargain carrier's truck breaks down (no backup plan). The driver goes silent – no tracking updates for 12 hours. The delivery appointment is missed, incurring detention and rescheduling fees. The real cheap carrier turns out to be double-brokering the load unsafely. The customer relationship gets damaged because their freight is late. They didn't save money. They just deferred the real cost. They chased price – not value or reliability. Too many in logistics confuse "low rate" with "low cost." They think a cheaper quote automatically means a better deal. Here’s the hard truth for shippers AND brokers: If reliability isn't factored into the rate, the total cost will always be higher eventually. Understand the carrier's reputation. Prioritize communication and visibility. Build partnerships, not just transactions. In logistics, the cheapest price is rarely the cheapest solution. Have you seen a "cheap rate" blow up spectacularly?

Does Using the Lowest Bid Really Save You Money? In the world of HVAC projects, it’s tempting to gravitate towards the lowest bid, thinking it will save your budget. But does it truly save you money in the long run? The answer is more complex than it seems. The Real Cost of Low Bids 1. Quality of Work: Often, the lowest bid comes from firms cutting corners to reduce costs. This can result in subpar workmanship, leading to frequent maintenance issues and, ultimately, higher expenses over time. 2. Material Quality: Cheaper bids might involve using inferior materials. While the upfront cost is lower, the durability and efficiency of these materials are often compromised, leading to premature replacements and increased energy costs. 3. Hidden Costs: Initial savings can be quickly offset by hidden costs that emerge due to scope changes, additional labor, and unforeseen complications. A seemingly low bid can escalate into a costly endeavor. 4. Project Delays: Companies offering the lowest bid may be working on tight margins, impacting their ability to adhere to timelines. Delays in project completion can lead to operational disruptions and lost opportunities.

When Low Bids Lead to High Failures: A Wake-Up Call from Our Local VA Hospital Here’s a hard truth: 80% of these low-quality LED flat panels installed at our local VA Hospital are already failing. This is the direct result of the government’s low-bid requirement in action. While cutting costs upfront might seem like a smart move, the reality is that poor-quality lighting leads to frequent failures, increased maintenance expenses, and ultimately, higher total costs. More importantly, it disrupts the environment where our veterans receive care—a place that demands reliability and excellence. You would think our government leaders would understand that you get what you pay for. Investing in quality LED lighting not only saves energy and money over time but also ensures long-lasting performance and a better experience for everyone. Let’s push for smarter procurement decisions that prioritize value and durability—not just the lowest price tag. Our veterans deserve lighting solutions that stand the test of time.

Low-bid wins is a guarantee for mediocrity, not savings. Too often, awarding construction projects to the lowest bidder leads to poor quality, missed deadlines and... ...you guessed it, blown budgets. Imagine that. Pushing for the lowest price as the deciding factor actually leads to higher overall cost. Don't believe me? The data backs it up: ➡️ 9 of 10 construction projects go over budget by an avg of 28% ➡️ Large projects take 20% longer than planned ➡️ Roughly 30% of work is rework due to quality issues ➡️ USACE sees 60% time and 7% budget overruns on average When cost is the only criteria, corners get cut and we all pay for it later. It’s time to rethink how we define "value" in construction. #construction #contech #enablinginnovation #capitalprojects TheEngiNerdLife

Let’s talk about the real cost of taking the low bid. If you manage 20, 50, or even 300+ sites, you’re under pressure to stretch every dollar. But here’s the truth no one wants to say out loud: Low-bid contractors don’t deliver value. They deliver headaches. • Sloppy workmanship • Over-sprayed sealer on curbs, sidewalks, and fences • Cut corners (literally) where edges are left unsealed • No communication • No accountability • Pavement sealer that is nothing more than black water that will wear off the asphalt in a few months • And let’s not forget: overdue invoices, slow punch list completion, and vendors who disappear when the check clears All while YOU—the facility manager—get the blame for “hiring the wrong guy.” Here’s the kicker: These jobs don’t even protect the pavement. They leave your properties looking worse… and your capital budgets in worse shape a year later. We’ve cleaned up tons of these messes. And in the end, the “cheap” job costs 2x more when you factor in rework, admin time, and the reputation hit. ⸻ Pro tip: Vet vendors the way you would a new hire. Cheap labor is the most expensive mistake you’ll make this year. #facilitymanagement #propertymanagement #asphaltmaintenance #sealcoating #paving #lowbidfails #multisiteops #capex #facilitymanagers #b2bfacilityservices