Alternate Bid
A separate add or deduct price submitted alongside the base bid that gives the owner the option to include or exclude defined scope.
Definition
An alternate bid (or "alternate") is a separate add or deduct price submitted alongside the base bid that gives the owner the option to include or exclude a defined scope of work. For example, "Alternate No. 1: Add price for upgrading lobby flooring to polished concrete" or "Alternate No. 2: Deduct price for omitting the rooftop solar array."
Alternates let the owner adjust scope after bids are received based on the actual numbers, without forcing every contractor to redesign the project for different scope options.
How alternate bid is used in estimating
Estimators price each alternate as a self-contained add or deduct. The alternate price typically includes the direct cost of the alternate scope plus a proportional share of overhead and profit. Some contracts also require alternates to include a separate schedule impact (number of days added or deducted), which the estimator calculates by adjusting the project schedule for the alternate scope.
On bid evaluation, the owner selects which alternates to accept based on actual bid numbers and budget. The accepted alternates are added to (or deducted from) the base bid to produce the final contract sum. A bid evaluation can shift the apparent low bidder, because Contractor A might have the low base bid but Contractor B might have lower combined pricing once selected alternates are applied. Estimators should price alternates carefully because alternates can be the deciding factor in bid award.
Pricing alternates correctly
Price each alternate as a self-contained scope including direct cost, share of general conditions, and overhead and profit. Calculate any schedule impact and document it. Be careful with deductive alternates — the deduction should reflect the cost saved minus any already-incurred cost (engineering, mobilization). Alternates that interact (e.g., choosing one finish package excludes another) should be flagged so the owner does not select conflicting options. Read the alternate descriptions carefully and ensure your pricing matches the exact scope described.
Frequently asked questions
Q.What is the difference between an alternate and a change order?
An alternate is priced and submitted with the original bid, giving the owner the option to include or exclude scope at award. A change order is issued after the contract is signed to add or modify scope. Alternates are bid options; change orders are post-contract modifications.
Q.Who selects which alternates to include?
The owner, based on bid numbers and budget. Some contracts require alternates to be selected at award; others allow alternates to be added during construction at the bid prices.
Q.Should alternates include overhead and profit?
Yes — most bid forms specify that alternate pricing must include overhead and profit, just like the base bid. Alternates priced without O&P will lose money for the contractor if accepted.
Q.Can an alternate change the apparent low bidder?
Yes. The owner evaluates the base bid plus selected alternates. A contractor with a higher base bid but better alternate pricing can become the low responsive bidder once the owner selects the alternates they want.
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