The bid/no-bid literature — ours included — leans on one ratio: estimating cost per pursuit divided by gross profit per win. The scorecard uses it. The web tool and Excel workbook compute it. But the ratio is only as honest as its numerator, and the numerator is where almost everyone lies to themselves.
Most estimators, asked what a bid costs, quote their own hours at their own salary. The real number carries burden, coordination time that never hits a timesheet, software that gets amortized across pursuits, and a share of the department that exists whether or not this bid does. Computed honestly, it is usually two to three times the guess.
The fully loaded formula
Cost per bid = (hours × burdened rate) + direct pursuit costs + allocated costs
Hours × burdened rate
Count every role that touches the pursuit: the estimator's takeoff and pricing hours, the chief's review, the PM's constructability pass, the admin who assembles the proposal. Burden the rate properly — salary plus payroll taxes, benefits, and bonus accrual typically lands at 1.35-1.5x base. A $95k estimator is a $62-68/hour cost, not $45.
Direct pursuit costs
Site visit time and mileage, bid-bond premiums, printing and delivery where still required, and the quiet one: subcontractor and supplier quote coordination. Chasing, leveling, and scoping vendor quotes routinely consumes 15-25% of pursuit hours on assembled bids and almost never gets attributed to the pursuit.
Allocated costs
Takeoff and estimating software seats, plan-room and lead-service subscriptions, and the estimating department's overhead (space, IT, management time), divided by annual bid count. A department that costs $400k a year and produces 120 bids carries $3,300 of allocation per pursuit before anyone opens a plan set.
A worked example
| Item | Quantity | Cost |
|---|---|---|
| Estimator: takeoff + pricing | 42 hrs × $64 | $2,688 |
| Chief estimator: review + strategy | 6 hrs × $85 | $510 |
| PM constructability pass | 3 hrs × $78 | $234 |
| Quote coordination + leveling | 9 hrs × $64 | $576 |
| Site visit (2 people, half day + travel) | — | $430 |
| Software + plan room allocation | — | $310 |
| Department overhead share | — | $650 |
| Fully loaded cost of this bid | $5,398 |
This is a routine mid-size commercial specialty bid. The estimator would have told you it cost "$2,700, maybe three."
Typical 2026 ranges by trade and pursuit size
| Shop / pursuit type | Typical cost per bid | Typical GP per win | Break-even hit rate |
|---|---|---|---|
| Small TI / service sub (<$250k jobs) | $800-2,000 | $12,000-25,000 | 6-10% |
| Mid-size specialty sub ($0.5-3M jobs) | $3,000-8,000 | $60,000-180,000 | 4-6% |
| Steel fabricator (fab & erect) | $5,000-12,000 | $120,000-350,000 | 3-5% |
| MEP sub, design-assist pursuit | $8,000-20,000 | $200,000-500,000 | 4-6% |
| GC, hard-bid public ($5-30M) | $15,000-40,000+ | $150,000-600,000 | 7-12% |
Notice the trap in the first row: small-job shops carry the highest break-even hit rates. The intuition "small bids are cheap, so bid them all" is exactly backwards — cheap bids against small profits demand more selectivity, not less. This is the arithmetic behind why disciplined small-works desks live and die by hit ratio.
Multiply your cost per bid by last year's losing bid count. A 120-bid shop at 20% hit rate and $5,400 per pursuit spent $518,000 estimating jobs it did not win. That spend is only defensible if it was aimed — which is the entire case for scoring pursuits before the takeoff starts.
What the number changes
- It sets your floor. Break-even hit rate = cost per bid ÷ GP per win. Below the floor, estimating is a loss center before a single award. The scorecard tool computes this from your own inputs and flags pursuits with negative expected value.
- It prices the no-bid. Declining a 15-point pursuit doesn't "cost nothing" — it saves $5,400. Framed that way, precon discipline stops feeling like turning down work.
- It exposes the coverage-bid tax. The GC who invites you as the third number twice a quarter is charging you ~$11k a quarter for the privilege. Decline politely, with a letter, and spend it where you can win.
- It reorders the automation math. Quantification is 40-60% of pursuit hours. Cut takeoff to review time and the mid-size sub's $5,400 bid becomes roughly $3,100 — which drops the break-even floor by a third and, more usefully, lets the same team bid the right jobs deeper: real quote coverage, real spec review, real risk pricing.
That last lever is the one PILARS pulls: AI takeoff at $100 per trade, per plan, against $2,700 of manual takeoff labor on the same pursuit. The point is not bidding more — it's making every scored, selected pursuit cost less and get more attention. See pricing here.