Serving the Atlanta area for more
than 30 years!

BID SHOPPING
Bid Shopping, defined in Canon 5 of the American Society of Professional Estimators Code of Ethics occurs "when, after the award of the contract, a contractor contacts several subcontractors of the same discipline in an effort to reduce the previously quoted price." Bid shopping may occur either before or after the award of the contract. In addition to price information, the status of a sub-bidder's competitive position or technical scope is equally sensitive. Legitimate practice precludes use of this information in haggling, trickery, or coercion of any kind. After sub-bidder commitments are made, sub-bidders should request, and should be advised of their competitive position, both in price and scope.

BID PEDDLING
Bid peddling, defined in Canon 7 of the Code of Ethics, occurs when a sub-bidder "approaches a general contractor who has been awarded a project with the intent of voluntarily lowering the original price below the price level established on bid day. This action implies that the subcontractor's original price was either padded or incorrect."

WHY A.S.P.E. PROHIBITS THESE ACTIVITIES
The Contract (or sub-contract, or purchase order) should go to the qualified prime bidder or sub-bidder determined on bid day at bid time, excluding prime bidders or sub-bidders who shopped or peddled bids prior to bid time.

THE ETHICAL DIMENSION
The ethical basis for this stand is free competition and fair play. Many construction firms fall prey to the practice of bid shopping or bid peddling in the belief that they will procure contracts not otherwise available to them, or that peddling will allow their firm to maximize profits on the project being bid. Gambling and often greed replace skill and insight. Professionalism is replaced by rolling the dice, and bid shoppers are gradually isolated and change or perish.

THE ECONOMIC DIMENSION
Bid shopping and bid peddling reduce the total profit available to the construction team. When a bidder cuts a bid below the lowest legitimate bid, the bidder is admittedly taking the contract for less than originally desired. No contractor enjoys the prospect of making less profit than desired. Therefore, the shopper has strong incentive to develop ways to recoup that lost profit. One of these ways is to cheapen quality. Another way is to search for opportunities to increase the amount of one's contract through extras. The bidder is constantly motivated to seek change orders, often pricing them at substantial premiums above the actual cost of the work done. Elimination of bid shopping and bid peddling is essential if the construction industry is to regain its rightful fee structure and it must begin to eliminate these unethical practices now.

Miller Grading Co., Inc. agrees fully with American Society of Professional Estimators' ethical stand concerning Bid Shopping and Bid Peddling. Miller Grading Co., Inc. further states that it will not participate knowingly with any person or firm who participates in this form of business activity.