Upgrading Your Pre-Qualification Process to Today’s Market Demands

With the bidding landscape drastically altered by the COVID-19 pandemic and economic downturn, contractors and sub-contractors are fighting up-hill battles to find and win new work. As they burn through their backlogs, it becomes increasingly important to strategically reposition the way they present their company’s qualifications.

Changes to the Pre-Qualification Process

Now that the bid spread is wider and higher on almost every job, contractors and their qualifications are facing more scrutiny and competition than ever before. And with new jobs being scarce for the foreseeable future, sub-contractors may need to seek work beyond their existing GC relationships.

This new environment has necessitated changes in the pre-qualification process to make a company stand out in the crowd and improve its chances of success.

Standing Out from the Competition

There are several areas a contractor or sub-contractor can highlight to differentiate their qualifications from the rest, including:

Experience – Customize the bid to highlight the unique trade, type of work (public/private), market sectors and other experience the company has that would be relevant to the job being bid on.

Past Performance – Quantify your performance record of coming in on-time and within budget on past jobs. Consider including cost performance reports, customer testimonials, quality reviews, and other materials that support your promises of efficient, high-quality service.

Safety Record – Go beyond the basic safety record that is required in the bid and demonstrate your overall commitment to safety. Outline the safety training, compliance programs, technology and other tools your company employs to create a safe jobsite, avoid project delays and protect the customer from financial and reputational risk. If you have a safety officer, explain his or her role and how it will benefit the customer’s overall experience with your company.

Technology – In an industry that is slow to adopt new technologies, your investment in safety technology, digital financial tools, data analytics and artificial intelligence will go a long way in differentiating your company from the rest. Explain how these technologies allow your company to increase efficiencies, avoid project delays, make the billing process easier on the customer’s staff and provide other benefits to improve their overall ROI.

Financial Capability – Your bid should paint a clear picture of your company’s financial solvency, both now and in the future. Include details on credit lines, cash flow projections, relationships with lenders and other advisors, top-line revenues and audited financial statements. Savvy customers know the lending restrictions, delayed payments and economic damages that are plaguing the construction industry today and will find extra reassurance in your transparency in a depressed economy.

Payment History – Emphasizing your strong history of on-time payments to your sub-contractors and vendors will further demonstrate your financial capability and put the customer’s mind at ease that project delays will not be caused by delinquent payments or liens.

Compliance with Contracts – Particularly if you are bidding on a contract with government agency-specific requirements, highlight your past compliance with MBE/WBE or other hiring obligations. Even if the contract does not explicitly require it, highlighting the diversity in your hiring practices could serve as another differentiator that separates you from your competition, especially as customers are looking for additional ways to expand their Diversity, Equity and Inclusion (DEI) efforts.

While these extra steps may put an additional responsibility on your already-strained project team as they recover from COVID-19 delays and damages, the benefits and ROI will position your company for long-term financial stability and success. Be sure to lean on the experience of your CPA, surety and other advisors to help you create the pre-qualification process that works best for your company and the bids that put its best foot forward.


Scott Stern Scott Stern is a Principal at Grassi and brings over 15 years of experience working in the construction, manufacturing & distribution, and real estate industries. Scott provides his clients with business and management consulting services, accounting and tax services, and assurance services. Scott works diligently with his clients to assist with financial reporting, preparing financial statements, audits, reviews, and compilations. At Grassi, Scott mentors... Read full bio

Steve Lemke Steven Lemke is an Audit Principal at Grassi and brings over fifteen years of accounting experience to the firm. Steve has experience in preparing financial reports and performing audit, attest and tax work for clients within the construction, professional services and real estate industries. Prior to joining Grassi, Steven was a manager at a private accounting firm where he led and managed a team... Read full bio

Categories: Advisory