How to Bid a Construction Job (+ Free Bid Template)

A bid is a promise about money you haven't spent yet. Get it right and you win profitable work. Get it wrong and you either lose the project to a competitor or win it and lose money on every phase.

Most contractors don't lose bids because their prices are too high. They lose because their bids are sloppy, incomplete, or slow. A clear, itemized bid delivered as a professional proposal beats a lowball number scribbled on a napkin almost every time.

This guide walks through how to bid a construction job the right way, from reading the plans to presenting the final number. Whether you run residential remodels or commercial buildouts, the process is the same.

Step 1: Read the plans and nail down the scope

Before you touch a calculator, you need to know exactly what you're being asked to build. Read every page of the plans and specs, not just the ones that look relevant.

Look for:

• The full scope: what's included, and just as important, what's excluded
• Specifications: material grades, finishes, and brand callouts that change your pricing
• Site conditions: access, demo, existing structures, grading, utilities
• Allowances: where the client hasn't picked finishes yet
• The schedule: deadlines and phasing that affect labor and overhead

If anything is unclear, ask before you bid. Write down every assumption you make. A bid built on a fuzzy scope is a change-order argument waiting to happen.

Step 2: Do a takeoff

A takeoff is the count. It's where you measure the plans and turn drawings into quantities: square footage of drywall, linear feet of trim, cubic yards of concrete, number of fixtures.

This is the foundation of the entire bid. Every dollar you price later depends on getting these numbers right.

How to do a construction takeoff

1. Work through the plans systematically, one trade or phase at a time
2. Measure areas, lengths, and counts for each material
3. Record quantities with units (SF, LF, CY, EA)
4. Add a waste factor to each material

Waste matters more than people think:

• Tile: 10-15% (more for diagonal or herringbone patterns)
• Lumber: 5-10%
• Drywall: 10-12%
• Paint: 10-15%
• Concrete: 5-10%

Build the waste into your quantities. If you need 150 SF of tile, order and price for 170 SF.

Manual takeoffs from paper plans are slow and error-prone. Foreman's AI plan takeoffs let you upload a floor plan or PDF and get measured quantities in minutes instead of hours, so you can bid more jobs without more late nights.

Step 3: Price materials, labor, and subs

Now you turn quantities into dollars. Every construction bid has three direct-cost buckets.

Materials

Multiply your takeoff quantities by current unit prices. Two rules:

• Use today's prices. Lumber, copper, and steel move constantly. A quote from three months ago is a liability.
• Handle allowances honestly. When the client hasn't chosen a finish, set a clear allowance: "Tile allowance: $8/SF, 30 SF = $240. Selections above the allowance are billed as a change order." This protects your margin when they fall in love with the $22/SF tile.

Labor

Labor is where most bids go wrong. Estimate hours by trade, then multiply by your fully burdened labor rate, not the raw hourly wage.

Your burdened rate includes payroll taxes, workers' comp, insurance, and benefits. That $25/hour framer probably costs you $38-42/hour once everything is loaded in. Price the real number or the profit disappears.

Subcontractors

Get written quotes from your subs for their portion of the work. Read each quote against the plans to confirm they're pricing the same scope you are. Then carry that number into your bid, and consider a small markup on subs to cover the time you spend managing them.

Step 4: Add overhead and markup

Your direct costs are only part of the picture. Overhead and profit are what keep the business alive.

Overhead is everything it costs to run your company whether or not this specific project exists: your truck, your office, your software, your insurance, your phone. Every bid needs to carry a share of it.

Markup is the amount you add on top of costs to cover that overhead and leave a profit. And here's the trap that quietly bankrupts contractors: markup and margin are not the same number. A 20% markup does not leave you a 20% profit margin. Confuse the two and you'll under-price every project.

We break the whole thing down in our construction markup and pricing guide, including the formulas and the margins other contractors actually use. Read it before you send another bid.

The short version: decide the profit margin you need, work backward to the markup that produces it, and apply that markup consistently on every job.

Step 5: Build the bid

With costs and markup in hand, assemble the numbers into a structured bid. Group line items by section or phase so the total is easy to follow and easy to defend.

For a kitchen remodel, that might be:

Demolition

• Remove existing cabinets (12 LF): $1,800
• Remove countertops and flooring (150 SF): $1,050
• Haul-off and dump fees: $400

Rough-In

• Plumbing relocation: $2,200
• Electrical, 6 circuits + undercabinet lighting: $3,100
• HVAC modifications: $800

Finishes

• Cabinets, 14 LF (allowance): $8,500
• Countertops, quartz 45 SF (allowance): $3,600
• Tile backsplash, 30 SF installed: $1,200
• Paint, walls and ceiling: $1,400

Then show section subtotals, a combined subtotal, your markup, tax if applicable, and the grand total. Section subtotals make change orders painless later: "Adding a pantry cabinet is an extra $2,400 to Finishes."

A budget builder beats a spreadsheet here because it carries your margin and markup automatically, keeps a library of reusable line items, and ties the numbers to the actual project so nothing lives in a file you can't find later.

Step 6: Present a professional proposal

Here's the difference between contractors who win bids and contractors who chase them: the winners don't send a number, they send a proposal.

A bare price forces the client to shop you on cost alone. A proposal sells the whole package: your scope narrative, your line items, your timeline, your terms, and your branding. It signals that you run a real business, and homeowners and commercial clients both notice.

Every professional construction proposal should include:

• Your company name, logo, and license number
• A clear scope of work and what's excluded
• Itemized pricing grouped by section
• A payment schedule (a common residential split: 50% deposit, 40% at rough-in, 10% at final walkthrough)
• A change order clause requiring written, signed approval for scope changes
• An expiration date (30 days is standard)
• A signature line for both parties

The change order clause is not optional. Without it, you absorb scope creep for free.

With Foreman's one-click proposals, your bid becomes a branded proposal your client can sign online with built-in e-sign. No copy-pasting into Word, no "let me email you a PDF," no waiting on a printed signature. For more on structuring the document itself, see our guide on how to write a construction proposal.

Bid faster without cutting corners

The contractors who win the most work aren't the cheapest. They're the ones who bid quickly, price accurately, and present professionally, every single time. A repeatable process, a solid template, and honest markup are what get you there.

Start with the free bid template above, or build the whole thing inside Foreman so your bid, budget, proposal, change orders, and invoices all share one source of truth.