The easiest, most effective way for a construction company to increase its hit rate is to stop going after projects that it cannot win. When a company has no chance to win a project, then it is just wasting its time and that prospect’s time, too.
Here are a few tips for bidding more effectively and ultimately winning more work.
Create a go/no-go process on all potential bids to determine if the contractor can dominate the competition on this bid, or if it has no chance at all. Whether the company decides to “go” or “no go,” it should stick with the verdict.
If you close your eyes and randomly shoot 100 times in all directions, what happens? You’ll probably hit a few targets if you’re lucky. Hopefully, you won’t shoot yourself in the foot. Going after every project out there is just like shooting in all directions with your eyes closed—your hit rate will be random and rely on luck and low bid.
Now, imagine taking only 30 shots and really aiming at the targets this time. The hit rate will increase exponentially because the company took the time to aim. In addition to hitting more targets, it also will make a few bulls-eyes and get those high-profile clients and profitable projects.
The typical marketer works 2,000 hours annually (40 hours a week times 50 weeks a year). If that person works on 100 proposals a year, he or she can spend 20 hours on each one. That same person can spend twice as much time (40 hours each) on only 30 proposals and still have 800 hours to spare.
Most likely, a company will win more bids when it spends twice as long on each of them. To make this work, the company needs to be precise with the bids it pursues.
Also, with all that remaining time, the marketer can be proactive and do things to attract new clients to the company. These activities may include updating recent projects on the website, creating a newsletter, attending a trade show, and meeting with existing clients periodically about upcoming work.
While it seems counter-intuitive, contractors will win more work and earn more by submitting fewer proposals.
Next time you get a proposal that you really can’t win, step back, reevaluate and find a new target.