Winning 30–40% of submitted bids means you're competitive but not the cheapest option. Your pricing likely reflects actual overhead and a margin that makes the job worth doing. You're losing to price sometimes — and that's correct.
Winning 50–65% of bids consistently suggests your prices are below what the market needs to be profitable. You might be winning because your overhead estimate is stale, your markup hasn't kept pace with actual cost growth, or you're leaving cost categories out of your estimates.
Winning 70–80%+ of bids is a strong signal that you are the cheapest option in your market — reliably. The only ways to be reliably cheapest are to be the most efficient operator or to be underrecovering overhead. For most contractors in this zone, it's the latter.
The most common cause. Your overhead rate was 12% two years ago and that's still what's built into your markup formula. Your actual overhead is now 16–18% and every bid is shipping with a 4–6 point markup shortfall. Calculate your actual current overhead rate using the overhead rate calculator and compare it to what you're actually pricing in.
Common missing categories: mobilization costs that aren't broken out, small tool and consumable allowances that get absorbed by direct labor, owner time on jobs that gets treated as overhead when it's actually a job cost, and equipment teardown and cleanup costs that always happen but never get estimated. Each one is small. Together they add up to 2–4 points of margin given away per job.
Some contractors shade bids down to win a relationship or fill a slow period — then never shade back up. If you've been discounting for 18 months, the discounted number becomes your reference point. Every subsequent bid is anchored to a number that was already too low. The discipline is knowing your true floor — the price at which you stop winning jobs rather than win them at a loss.
Use the overhead rate calculator to run actual SG&A against actual revenue for the last 12 months. Compare to what you're pricing in your bids. The gap is the first number to close.
Don't reprice everything overnight. Raise bids incrementally — 2–3% across the board — and watch what happens to your win rate. If your win rate drops from 70% to 50%, you've found a healthier price point. If it drops to 25%, you've gone too far for your market and competitive position. The data tells you where to stop.
Win rate should be on your monthly financial dashboard. Not just revenue, backlog, and margin — win rate. A rising win rate is a warning signal, not a success metric. Build it into your monthly review and treat any sustained move above 55–60% as a trigger to re-examine your pricing.
The goal: Win enough work at the right margin to fund the business, build cash reserves, and generate a return. Not win all the work at any margin. The jobs you don't win at the wrong price are not lost opportunities — they're losses you avoided.
You keep winning because your price is below what competitors need to be profitable on the job. A win rate above 60–70% consistently is a signal that your bids aren't recovering overhead at the rate it's actually accruing. Calculate your actual overhead rate and compare it to what you're pricing in.
Three signals: win rate consistently above 60–70%, jobs completing under budget but net margin still shrinking, or full backlog with persistent cash flow tightness. Any one of these points to underpricing. Use the overhead rate calculator to find the gap.
Raise prices 2–3% per bid cycle and track win rate. A drop from 65% to 45% win rate after a price increase is healthy — you're now winning fewer but more profitable jobs. The goal is not maximum wins. It's enough wins at the right margin.
If your win rate is above 60%, your overhead rate probably isn't built into your bids. Let's find the gap.
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