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> If someone underbids the next contractor by $250 million on a job they've never done before, you're supposed to politely laugh them out of the room.

Most of the time, you can't, at least not for government projects. Because of procurement laws and rules (designed, among other things, to allegedly be transparent and to provide accountability), a government body is required to accept the lowest bid from the contractor that met all of the requirements. Seeking an "experienced contractor" is usually seen as code for "we want to use our friends" by a skeptical legislative body, so things like tenure and past projects can't be considered.

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Odd. I've been involved in a few government bidding processes in Europe, and detailing past projects was always a major part of what we'd get graded on.

Indeed. Typically, being able to build the thing is a requirement, and that is typically made objectively measurable by stating that you must have successfully built similar projects.

That has its downsides, too. A common complaint in the EU is that there is no way for small building companies to become large companies. Reason is that, to become a large company, you have to do large projects, and to get large projects, you have to have done large projects.

In the EU, when comparing offers, one doesn't have to pick the absolutely cheapest that meets the requirements, either. A slightly more expensive offer that more than meets the requirements (for example by having much less environmental impact, by requiring less closure time of a road, or by producing something that has lower maintenance costs) can windhover one that just meets the requirements.

It's part of your grade, but it is rarely an overriding factor in my experience. Lots of experience plus slightly higher price will beat little experience and slightly lower price, but it won't beat little experience and very low price.

I was recently involved in a bid for a government contract where we got perfect scores on all factors, but still lost the bid to a small company with little to no relevant experience, but who claimed they could to the job for a third of the price.

To alleviate this somewhat, at least in Federal contracting, "best performer" can be chosen over "lowest bid" and often is if the project will be put at risk by an inexperienced contractor, or somebody trying to slip in on the cheap and provide substandard contract completion and/or try to squeeze the money out of the government later.

The obvious counter to this, and it's built-in to the process, is the "past qualifications" requirement. If your company has never built a bridge, they should have been disqualified from the bidding process via F.A.R.

The usual workaround for this is in IT is to sub-contract the necessary portions to those with said experience, so that the packaged team has the experience as a whole, but while that might seem like a loophole, it generally isn't bad because it means that the ones with the experience are the ones doing the work that requires the experience.

Admittedly, this isn't federal, and I don't know how what the bidding requirements are for state work, but if there's no disqualifier for "never done this before", heaven help the state of California.

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