Tennessee Estimating & Bidding
In Tennessee a contractor must be licensed to bid, and the bid itself must disclose the license. This chapter covers the profit math, the bid-law disclosure, and the quantity takeoff.
Markup versus margin
Margin is profit as a share of the selling price. For a target margin, divide cost by (1 minus the margin): a $60,000 job at a 25% margin is bid at $60,000 / 0.75 = $80,000. Multiplying cost by 1.25 gives $75,000, which is only a 20% margin - the recurring markup-versus-margin trap.
The bid-law disclosure
Because a contractor must be licensed before bidding, Tennessee's bid law (T.C.A. §62-6-119) requires a bid on work requiring a license to disclose the contractor's license number, the classification allowing the work, and the license expiration date. For many public bids this information goes on the outside of the bid envelope, and a bid that omits it can be rejected.
The quantity takeoff
A quantity takeoff measures and counts the work quantities from the plans so they can be priced. For concrete, convert thickness to feet and divide by 27 to get cubic yards: a 20 ft by 30 ft slab at 6 inches thick is (20 x 30 x 0.5) / 27 = about 11.1 cubic yards. Accurate takeoffs keep the bid from running short.