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|Title:||Bidding model for refurbishment work|
|Authors:||Pin, Teo Ho |
|Source:||Pin, Teo Ho,Scott, W.F. (1994). Bidding model for refurbishment work. Journal of Construction Engineering and Management 120 (2) : 257-273. ScholarBank@NUS Repository.|
|Abstract:||This paper develops a simple statistical model for competitive bidding in the building industry. We take a statistical approach, using a large set of actual bids (1,350 renovation contracts) collected by the Builders' Conference in London, United Kingdom. The distribution of bids is fitted to a normal curve, from which one may estimate the distribution of the lowest of n bids (representing a given contractor's competitors). Part of the study involves the estimation of various parameters, such as the coefficient of variation, which is a measure of the relative spread of bids. A simple formula is obtained for the bid that has a specified chance of success (e.g. 20%, 50%, or 90%), and the theory is tested on data from five contractors. A likely consequence of the adoption of the proposed models by the industry in general would be a tendency toward tighter bidding, i.e. the difference between the winning bid and the next lowest (which is, in a sense, a loss to the construction industry caused by variations in bids) would be reduced.|
|Source Title:||Journal of Construction Engineering and Management|
|Appears in Collections:||Staff Publications|
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