FREE Construction Bid Contract Template: Streamline Your Bidding Process

Ever feel like you're spending way too much time drafting complex contracts instead of focusing on winning construction bids? A construction bid template can help streamline this tedious process. Instead of starting from scratch every time, you can simply plug in the specifics of each project, and you have a comprehensive contract ready to go.

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An Overview of Construction Contracts

A construction contract is a legally binding document that formalizes the agreement between you and a project owner. It reflects an accepted offer, where you commit to completing the scope of work specified, and the project owner agrees to pay the agreed-upon sum.

To put it simply, it outlines exactly what needs to be done, when it needs to be done, and how much it costs. You're legally bound to stick to what's written there, and so is the client.

For example, you cannot return to your client requesting more money if certain aspects of the project turn out to be more challenging or costly than initially anticipated. Likewise, the project owner cannot request a discount if they're cash-strapped.

These terms provide clarity and avoid any potential headaches down the road. Fail to stick to them and you risk a breach of contract. For instance, using materials that are clearly inferior to the ones required could result in a material breach.

That said, any revisions must be made through mutual consent, typically for the mutual benefit of both parties. Maybe project requirements change, or critical, unforeseen circumstances arise that alter the timeline or budget. Whatever the case may be, all the parties involved need to be on the same page before any changes happen.

Construction Bid Contract Template Vs Bid Proposal Template

Note that some contractors may refer to a construction proposal as a "contract," but it's important to distinguish between the two.

A bid proposal is a detailed document you submit as part of a competitive bidding process to win business. It's your chance to show off what you can do and convince the project owner to hire you. Once they accept your proposal and you both sign on the dotted line, that's when it becomes a construction contract.

This article focuses solely on the contractor bid contract template. Here's a simple construction bid contract template you can make a copy and start using today.

If you'd like to read more on:

• how to create winning construction proposals
• download a bid proposal template
• or learn how bid proposal templates can help you.

Follow the guides we've linked above.

Essential Elements of a Construction Contract

Construction contracts don't have to be overly complex, confusing documents. But you need enough detail to ensure everyone knows what they're signing up for. So, what should you include?

Detailed Scope of Work

If you're a seasoned pro, you've probably been in situations where you're asked to do extra work that wasn't part of the original deal. This could be due to a lack of detail in the scope of work or miscommunication with project managers. Either way, you need to nail down all the details in your scope of work to avoid such surprises.

When putting together this section, aim for a balance. Your goals should be broad enough for easy reference but specific enough to provide all the necessary information that covers all the bases.

Start by painting the big picture. What's the end goal of the project? What does success look like for your client? What exactly will make this project a win?

Then, break things down into manageable tasks and deliverables, specifying the materials, labor, and resources required for each.

It's also important to establish clear boundaries and limitations. Define in detail what is included in the scope of work and, equally important, what is not included.

Construction Project Timeline

"Time" in this context is not just about meeting deadlines.

For starters, it's also about knowing exactly when things kick off. Some contracts require you to start as soon as you sign on the dotted line, while in others you might need a formal "Notice to Proceed" before you can get going.

Defining substantial completion is key too. It marks the point where the owner can start using the property, even though there might still be some finishing touches to wrap up. It can affect:

• deadlines for making final payments to the GC and subcontractors
• the deadline for you to file mechanics' liens or bond claims
• the start of warranty periods for various project components, such as building systems or materials

You also need to clearly outline your milestones. Milestones provide clear markers of progress and give everyone involved — from clients to subcontractors — a shared understanding of where the project stands and what's next.

Delays and extensions are par for the course in construction. Most contracts address them, detailing submission requirements for delays or claims. But you'll need to differentiate between their different types to avoid any surprises down the line:

• Critical delays impact project completion dates or crucial milestones, affecting the critical path and leading to schedule extensions. Noncritical delays affect specific activities but don't stall overall project completion.
• Excusable delays, like bad weather, are usually listed in the contract and often extend project schedules. Inexcusable delays, caused by the contractor's actions, typically don't result in extra time or money.
• Compensable delays warrant extension or compensation for the affected party.

Payment Schedule

This section is essential for managing your cash flow and ensuring you're compensated fairly for your hard work. It needs to answer questions like:

• What's the process for submitting payment applications?
• Will a portion of your payment be held back until the end of the project as retainage?
• How is the timing of progress payments determined?
• When do you consider your work "substantially complete"?
• What happens if the owner raises concerns about the quality of work?
• Are you getting paid in stages as the project progresses or all at once when it's done?

You'll likely find a reference to the Schedule of Values, which breaks down how much you'll get paid for each part of the job as it progresses.

It allows GCs to track work progress against payment milestones. By comparing actual expenditures to the predetermined estimated cost for each work item, GCs can ensure that payments align with completed work and the cost estimate of materials delivered and labor costs.

Other elements often overlooked in the fine print? Pay-when-paid and pay-if-paid clauses. They're like safety nets for owners and they dictate when payments are made based on other events (like payment from the owner to the GC.)

To clarify:

• A pay-if-paid clause states that the owner is not obligated to pay the you unless they themselves receive payment. In short, if the owner doesn't get paid, you might not either.
• On the other hand, a pay-when-paid clause means that even if the owner hasn't been paid yet, they still have to pay you within a certain timeframe. So, you're not left hanging indefinitely waiting for your money. It's more about when you'll get paid, rather than if you'll get paid at all.

Review these provisions carefully and seek clarification if needed to ensure fair payment terms.

Changes

Changes are a fact of life in the construction industry. So it's essential to define how to deal with them early on to ensure everyone stays on track and avoids doing extra work for free.

These provisions typically fall into three categories:

• Change Orders: These are like mini-adjustments to the original plan. When you sign off on a change order, it becomes part of the official contract. But these minor tweaks can sometimes cause a bit of chaos. That's why you need clear guidelines in the general conditions section of your construction bid form for how they are agreed upon, executed, and billed.
• Change Directives: These can be risky if not limited by the contract's general conditions. They authorize the owner to make changes to the work without your input, with the details on price and schedule changes hashed out later. If this is part of your contract, it's likely subcontractors will have similar terms.
• Minor Changes: These are simple adjustments to the project that don't impact the price or completion time significantly. But what you consider minor might not be so minor to someone else. So to avoid confusion, it's wise to establish clear parameters in the agreement for defining minor changes.

Having clear procedures in place for dealing with these different types of changes allows you to survive the twists and turns of construction projects without getting thrown off course.

Try Downtobid For Free

After creating contracts that cover all the essential aspects and dotting all the i's and crossed all the t's, the next step is assembling the right team to bring your entire project to life.

That's where Downtobid comes in. Our construction software offers a tailored list of local, qualified subcontractors who are ready to lend their expertise to your project. You can bid goodbye to outdated methods like cold calling and endless Google searches that eat away at your valuable time during the construction process.

But that's not all; Downtobid goes beyond just providing a list of names. You can create personalized invites to bid that showcase the expertise of your subs and provide clear scope summaries, allowing them to understand your project at a glance.

And the results speak for themselves. Users report a 30% increase in response rates when using our platform.

You can try Downtobid for free today.