what is the difference between a bid and an estimate?
An Estimate is a best faith prediction of the effort that will be expended to perform a task. It has tolerance and distribution, and may depend on other factors out of the estimators control. It is the opinion of a professional. A Bid is a price submitted to perform a task. This is probably based on an estimate, but takes many other factors into account. It includes either profit or a market margin (which may be negative), and reflects the interest that the bidder has in the task. It also includes the risk the bidder wishes to take.
In the construction industry, a bid is a document that a general contractor gives to a potential client that shows how much he will charge to do the work. The word âbidâ can also refer to the actual dollar amount in the document. A bid is created when the scope of the work is clearly defined by the client.