There is a phrase that is so familiar yet wildly underrated because it’s often overused to chastise someone who is acutely aware of his folly. The old adage, “if it sounds too good to be true…” doesn’t even need a conclusion since we already know how it ends, badly. We are all susceptible to the allurement of a great offer that’s too good to refuse. Late night infomercials capitalize on this when they say “but wait, there’s more” with every sale.
When Show Managers start receiving responses to their request for proposals, or RFP’s, often times there will be a low bid offer that is tempting to accept. However, just like we know that more will be included with our shopping network order, so will the low RFP offer. And chances are high that it won’t be advertised until it’s too late.
It’s worth noting that guidelines for RFP’s in the event industry tend to be ambiguous which can lead to a poorly constructed proposal. An unclearly defined RFP will often cause lower bids, thus leading you down a road that’s hard to navigate. In the case of murky expectations, businesses might bid low with the intention of profiting from change orders.
On the other side of the spectrum, when contractors are faced with in explicit specifications, a few might bid on the high end because they want to make sure that anything and everything is covered, whether you need it or not. When you are thorough with your proposal, you can be confident that what you receive will be a truer representation of what the company has to offer.
Most contractors offer reasonable and comparable bid numbers in RFP’s with larger companies sometimes bidding on the higher end. This can be a natural result of having experience with the trade show business and knowing what it takes to get the job done, while lower bids are often an indication that they are willing to cut corners.
In The Game of Life, a popular children’s board game, players are given the option to travel down the risky path or the safe path. In real life, we aren’t given the secure choice of a safe path, but there are usually warning signs that can prevent us from making poor choices that would ultimately jeopardize our outcome.
There is a major red flag that Show Managers need to be aware of when they receive their RFP’s back, and that is the low bid or $0 invoice. These are usually submitted by disreputable and untrustworthy companies that you need to be very cautious of. When you receive a lowball or $0 offer, it’s often to persuade you to accept their services at the lower rate, only to bill you and exhibitors at the end for the following:
- Services that would normally not be billed to you.
- Requests for extras like tables, chairs and waste baskets.
- Sneaky ways to make up for slim or backward margins, like order changes.
Also, a low-bid can indicate that the company doesn’t understand the scope of the job and would deliver services that could miss the mark by a landslide. You should also be leery of returned proposals that agree to all of your terms. This could be a sign that they aren’t paying attention to the details and are saying “yes” to everything in a desperate attempt to seal the deal. The pitfalls of the $0 dollar invoice keep racking up with further repercussions such as:
- Unhappy contractors and subcontractors, that can threaten the stability of those partnerships.
- Getting nickel and dimed for every last thing.
- Upset Show Managers and exhibitors who feel low on the priority list and are left with needs unmet.
- Cutting corners on quality and craftsmanship in order to maintain the low-bid.
- Lack of liability insurance in case something really goes awry.
No one likes to be caught off guard. There will be times when you are confronted with something unexpected, like overage charges on your cell phone bill when you were promised unlimited data. While you can’t always protect yourself from the unanticipated, being diligent with research and not being afraid to ask questions can spare you the painful lesson. Don’t allow moments to find you unprepared for what you are qualified to handle.