Bidding Strategies and Probabilities

by Marvin Gates,


Serial Information: Journal of the Construction Division, 1967, Vol. 93, Issue 1, Pg. 75-110


Document Type: Journal Paper

Discussion: Keevil Albert S. (See full record)
Discussion: Bristor John D. (See full record)
Discussion: Star Robert M. (See full record)
Closure: (See full record)

Abstract: Seven competitive bidding strategies for optimizing profits in construction contracting are developed; namely: (1) Lone Bidder Strategy—no competitors; (2) Two Bidders Strategy—one competitor; (3) Many Bidders Strategy—more than one competitor, number and identity of competitors not known; (4) All Bidders Known Strategy—more than one competitor, number and identity of competitors known; (5) Number of Bidders Known Strategy—more than one competitor, number of competitors known but identity of competitors not known; (6) Least Spread Strategy—minimizing money left on the table; and (7) Unbalanced Bidding—maximizing competitive position through quantity change. In addition, the following statistical distributions and applications are investigated: (1) Binomial Distribution—forecasting the frequency of winning; (2) Gaussian Distribution—precision of bidding; and (3) Poisson Distribution—forecasting of number of competitors. Other related topics are examined briefly.

Subject Headings: Bids | Frequency distribution | Profits | Gaussian process

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