A bid costs real time whether you win or not. Put in a few rough numbers and see what bidding is worth on average, and how good your chances need to be just to cover the time.
If the contract is won, the profit is the yearly value times the years times your margin. Your chance of winning starts as one in the number of bidders, and goes up or down with how well the work suits you (capped at 90%). The expected return is that chance times the profit, minus the cost of writing the bid. The break-even chance is the bid cost divided by the profit.
It's a rough guide, not a forecast. Quality marks, price weighting and the incumbent all move the real odds. But if a bid only pays when you'd need a better than even chance, it's usually a no.
Want a second opinion on a real tender? Send me the link. I'll read it and tell you what it asks for, how the marks are split and whether it suits your firm. It's free.
Email [email protected] · Bid or no bid checklist · How to price a tender
General information only. Your own figures and the tender documents decide.