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Blog | 02.27.20

Road Construction is Getting Ready to Pick Up, and That’s a Good Thing. Here’s Why.

Most of us don't get excited about the prospect of more road construction – unless you're among those bidding on the government contracts for those projects. Then, you can't wait for the next project to start.  

Depending on where you fall on that spectrum, you're either going to celebrate or cringe after hearing this news: “state transportation departments and local governments are expected to spend $77.5 billion on highway and street construction investments alone in 2020, a 6% increase over 2019, according to the American Road & Transportation Builders Association.” That's after a 9% spending increase that occurred between 2018 and 2019. 

In other words, your commute may soon take longer, but the opportunity to secure more work could be worth it.  

Whether you’re a prime contractor or a subcontractor, government-funded highway, byway and even city road projects present significant growth opportunities. They generate significant revenue (assuming you plan and manage resources properly), establish a performance track record that opens up doors to future public sector projects and, in the meantime, provide job stability to your workers. Though your family and neighbors may not be a fan of the orange cones, detours and road closures, we can all agree that the finished product – smooth, open roads with less traffic – will land you some goodwill.  

A few tips when bidding on these projects:  

  • Build a “team” you trust – We’re not just talking about a strong workforce, either. (Though having experienced and reliable workers on your payroll is critical.) When it comes to bidding on any infrastructure construction or improvement project, it is imperative that the company positioning itself as the prime contractor have a team of highly qualified subcontractors on standby
  • Join a “team” you trust – If you are better suited to serve in a subcontractor role, then make sure you vet the prime contractor like you would any other partner. Does the company have a good reputation for quality and on-time delivery? Does it have strong financials and a track record of on-time payments to subs? What is the prime’s project management style? And what level of liability does it maintain or defer? These are just some of the things you should investigate before partnering with other on a project and aligning your reputation with theirs.
  • Scope out the project using multiple lenses – Attend public forums hosted by government agencies and listen to community concerns. Schedule pre-bid site visits and briefings to ensure the solicitation and your proposal thoroughly address the requirements. Review early plans to see if any potential issues have been overlooked and, of course, to better plan your resources should you be selected as either a prime contractor or subcontractor.
  • Verify that you meet minimum business requirements for each project – The bonds, licenses, insurances, permits and technical documentation you will need to produce with your bid will vary between public sector agencies and, sometimes, even projects. Knowing that many of these things can take weeks to secure, confirm these requirements the second you learn about the bid opportunity. Better yet, reach out to agency procurement officers to see what you can learn about planned solicitations or to inquire about their typical requirements.

Does Teamwork Make the (Government Contract) Dream Work?

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Curious Which States are Spending the Most?  

The National Association of State Budget Officers (NASBO) has several reports that breakdown state spending by category. This could be helpful if you’re trying to prioritize your bidding resources or focus your market research. For example, we know that 18 states increased their transportation spending in FY 2019 by at least 10 percent and that each state is taking a slightly different approach to road improvements.  

You could also tune into the “State of the State” speeches, as governors have a tendency to highlight spending priorities such as transportation infrastructure. (Replays are available for those you’ve already missed on many state’s websites.)  

Taking Advantage of the Boom  

Make sure that your Periscope S2G account is updated to search for these opportunities and that you're checking your daily bid notification emails daily (or logging into your dashboard) to get a jump start on proposals as soon as solicitations are posted.  

Don’t yet have a Periscope S2G account? Sign up for free now to start receiving bid notices from state and local governments, as well as non-profits, education entities and special districts. Since it can be hard to narrow down the precise keywords you should use to find solicitations related to road construction / transportation infrastructure projects, you'll want to take advantage of Periscope S2G's Relevance Engine. It uses machine learning to search beyond traditional keywords to find all of the relevant opportunities.   

Not quite ready to start bidding on these types of projects but want to in the future? Know that more projects are always in the works, which means there are always new opportunities to add to your pipeline when ready. But you need to pay attention because the planning phases are quite long and the solicitation process can start months, or years, before work actually commences.