Bid undercutting reaches ridiculous proportions…Another Example

As was reported by Mark Anthony of “Demolition News” back on August 24, 2009, in an article entitled “Bid Undercutting Reaches Ridiculous Proportions,” [link here: http://www.demolitionnews.com/2009/08/24/bid-undercutting-reaches-riduculous-proportions/#comment-1746] Mr. Anthony highlighted the current atmosphere of excessive low bidding on demolition projects across the United States.

I have expressed in previous postings my own theory regarding the current economic climate and lack of aggressive bidding we have witnessed; companies are desperate to solidify any work, even at the expense of losing money. A quick victory for these companies does little to strengthen long term growth and hampers the probability of surviving into the new fiscal year.

Here is a bid tabulation just faxed to our office. The project entailed the asbestos abatement of a former powerhouse in downstate Illinois. The second bid package was for the demolition of the powerhouse. Overall, a moderate size job for both abatement and demolition. Below are the bid results - I have not included the names of any company despite the public nature of this information.

Asbestos Abatement
$279,483
$531,000
$622,000
$745,000
$794,000
$928,700
$2,715,438

Building Demolition
$59,700
$73,900
$118,000
$126,800
$151,764
$163,436
$202,202
$209,436
$224,000

In each bid package, disregard the high and low bids; the disparity is still abysmal. Certainly, these are not the worst results we have encountered.

What I see reflected in the numbers is an economy that exists in the hallo of a coma; vital signs are apparent, cerebral comprehension, departed.