Question

Which of the following factors could result in you increasing your profit margin on a potential bid. a. Location of the project b. who the architect is c. the subcontractors d. who the owner is e. all of the above

3. An adjustment will need to be made to the total bid bond cost when. a. The contract bid amount changes b. The project duration is under 12 months c. The project duration is over 12 months d. A & B e. A & C

Answer 1

• Which of the following factors could result in you increasing your profit margin on a potential bid. -
  • e. all of the above

Explaination- Option a) Contractor's profit may vary depending on the location of the project suppose the project is located in remote area it will cost him more for mobilization and transportation rather in city area or nearby area. This factor may result in increase of profit.

Option b) Who the architect is ? This is the major factor affecting on contractors increasing in profit, if architect's drawing, specification suggested to the client are not marginally complex or difficult to execute it can increase profit of contractor. This factor may result in increase of profit.

Option c) The subcontractors assigned by the contractor to complete the project may affect contractor's profit depending on the rate quoted by them to the contractor. This factor may result in increase of profit.

Option d) Contractor's profit mainly depends on owner, as owner decides at what price he is going to freeze the contract. This factor may result in increase of profit.

Option e) So option e is preferable.

• 3. An adjustment will need to be made to the total bid bond cost when-
  • a. The contract bid amount changes

Explaination- Basically bid cost is a guarentee to the owner or client that if contractor fails to start the project then owner/client will get the compensatation. And bid cost is usually 4-10% of total contract amount. So options b), c), d), e) are not aplicable.

Summary- Which of the following factors could result in you increasing your profit margin on a potential bid -e. all of the above , An adjustment will need to be made to the total bid bond cost when- a. The contract bid amount changes .