How to compare three contractor bids that look nothing alike

The advice to get three quotes is sound and almost always incomplete, because it stops before the hard part. Three bids for the same project routinely differ by a wide margin, and the instinctive reading — one is greedy, one is a bargain — is usually wrong. Most of the time they are quoting different work, and the job is to find out how before choosing.

Write the scope before you ask for prices

This is the step that makes everything else possible and the one most people skip. Put in writing what you want done, what stays, who supplies materials, and what your budget assumptions are. Hand the identical document to every contractor. Without it each one quotes a slightly different project shaped by what they assumed you meant, and no amount of analysis afterwards recovers the comparison.

Find the exclusions first

Read what each bid does not include before reading what it does. Disposal, permit fees, painting after repair, moving and reconnecting appliances, protecting floors, final cleaning — these commonly appear in one bid and not another, and they are where a cheap quote and an expensive one converge once you add the missing pieces back in.

Normalise the allowances

An allowance is a placeholder for something not yet chosen — tile at a certain price per square metre, fixtures at a certain budget. Two bids with different allowances are not comparable at all, because the cheaper one may simply have assumed cheaper materials. Ask every contractor to price the same allowance figures, or the comparison is meaningless.

Ask what happens if the scope changes

Every bid should say how change orders are priced and approved. A contractor with a clear process — written, approved before work continues, priced at a stated rate — is telling you something good about how the project will run. A bid silent on change orders is a bid that will change without a conversation.

Interrogate the low bid rather than dismissing it

A materially lower bid is information, not automatically a red flag. Sometimes it reflects a genuinely leaner operation or a gap in their schedule they want to fill. More often it reflects work left out, cheaper materials assumed, or a contingency the contractor intends to bill later. Ask directly what they have assumed that the others have not. A confident answer is reassuring; a vague one is the answer.

Weigh the schedule honestly

A contractor who can start next week may be the right choice or may have availability for a reason. A contractor booked three months out is usually booked because people keep hiring them. Neither fact decides it, but a suspiciously immediate start on a busy trade in a busy season is worth a question.

Separate the two warranties

Manufacturer warranties cover materials failing early. The contractor's workmanship warranty covers installation errors — and that is the one that matters more, because most failures are installation rather than material. Compare the length and terms of the workmanship warranty across all three bids; it varies far more than people expect.

What to do with the result

Once exclusions and allowances are normalised, the bids usually cluster more tightly than they first appeared, and the remaining gap tells you something real about overhead, crew quality or how much risk each contractor has priced in. Choose from that adjusted comparison rather than the headline numbers, and you will be choosing on the thing you actually care about.