How to Write a Contractor Bid: What to Include in a Construction Proposal
A good proposal wins work and prevents arguments later. It tells the client exactly what they're getting, what they're not getting, what it costs and when they pay. Behind it sits an estimate the client never sees.
1. Build the estimate first, internally
Price materials, labor hours at a loaded rate, subcontractor quotes, equipment, permits and dumpsters. Then add overhead (insurance, vehicles, office, your own time) and profit. Keep these numbers on internal sheets. The client sees the price, not your markup.
2. Margin vs markup
If costs are $10,000 and you want a 20% margin, the price is $10,000 ÷ 0.80 = $12,500. A 20% markup gives only $12,000, which is a 16.7% margin. Know which one you mean.
3. What the proposal should include
- Your details: business name, contact, and license number where required
- Client and job address, date, and how long the price is valid
- Scope of work: specific and in plain language, with materials, brands or allowances where they matter
- Exclusions: what's not included (permits? haul-away? painting?). This section prevents the most disputes.
- Alternates and options, priced separately, so the client can choose upgrades without a new bid
- Price: total, or by phase
- Payment schedule: deposit and progress payments tied to milestones, plus the final payment
- Change order terms: changes are priced and signed before the work is done
- Timeline and what could affect it
- Signatures and date
4. Check local rules
Some states limit deposit sizes for home improvement work, require specific contract language or cancellation notices, or require a license number on proposals. Check your state's contractor board.
5. Keep it readable
One or two clean pages beat ten pages of boilerplate. Use the client's language ("replace back deck") rather than internal cost codes.
6. Track win rate and actuals
Note which bids you win and lose, and compare winning bids with actual job costs (see construction job costing). Both tell you whether your pricing is right.
Our Contractor Proposal Template Spreadsheet (Excel and Google Sheets) prices the job on internal tabs, including construction bid and estimate lines with alternates, then prints a clean client proposal with a payment schedule and signature block.
General information, not legal advice. Contract requirements vary by state.
Contractor Proposal Template Spreadsheet: instant download for Excel and Google Sheets.
Get the Contractor Proposal Template Spreadsheet on Gumroad