With more than 160 active projects on their books and a turnover of about $2.6 billion, Hutchinson Builders is one of the most active tier one builders in the Australian tender market.
In this TUD Plus Briefing from our recent Construction Tender Essential course, Hutchies’ business development manager Paul David provides insights into the process from the company’s perspective—including the margins it works with.
David said the Hutchinson’s scope of projects, from $100,000 to $360 million, meant it was delivering more than 260 projects annually.
“We lodge about 1250 tenders annually, so every day, five tenders are submitted out of a Hutchinson office somewhere around the country,” he said.
“Of those 1250, about 10 per cent to 15 per cent aren’t built … so we generally work on a strike rate of about one in four and I think that’s pretty much industry standard.
“If a builder is winning much more than one in four, he’s probably considered by the market to be too cheap.
“And if [they’re] winning less than one in four, they’re probably considered uncompetitive or too expensive.”