September 2003

Ran: San Diego Business Journal - Monday, September 8, 2003

Public Bidding Gets High-Tech With eBidBoard Web Site
Construction: Agencies, Contractors May Benefit

By: Mandy Jackson

Michael Cornelius, founder and CEO of Construction BidBoard Inc., is a civil engineer by training, not a Web site designer.

Cornelius was fed up with inefficiencies associated with the public bidding process after more than 20 years in the construction industry. He used his savings and money from private investors to put the process online.

Construction Bidboard was established in July 1999 and is headquartered in Sorrento Mesa. In August 2002, the company introduced its Web site to the market, first recruiting public agencies to post bid requests on the site. Ebidboard opened up for the contractor subscriptions in February of this year.

To date, the Web site has handled $5 billion in projects for more than 130 public agencies.

"Every day there is more and more data pumped into the system," Cornelius said

Construction Bidboard has 20 employees, 18 of whom work locally. The other two work in Northern California. Subscribers are located between San Diego and Kern Counties, and as far north as Santa Barbara.

"We want to have California built out by March 2004. Then we want to move into other regions in 2005 and 2006," Cornelius said.

Subscription fees vary for commercial users by the type of company. The maximum is $1,795 per year.

Public agencies post their project data on the site for free.

Another Form Of Outreach
Noel Gilchrist, senior information technology specialist for San Diego's engineering and capital projects department, said the service is free, but the city has to pay for staff time to input the information.

"We post our major construction and design project there," Gilchrist said.

That includes water, sewer, transportation, and building projects worth more than $250,000. Ebidboard did not replace any other media where the city normally advertises its projects since not all contractors subscribe to the site, Gilchrist said.

"It's just another form of outreach," he said. "Eventually we hope to link their Web site to the city Web site."

Gilchrist said the convenience is that it sends and e-mail to contractors who subscribe as soon as a request hits the site.

Comparing Costs
"One of the biggest benefits, if utilized properly, is eBidboard gives you historical costs," Gilchrist said.

For example, the city can compare concrete costs that have been paid on other projects.

Cities require general contractors to hire subcontractors and suppliers that are considered disadvantaged businesses - small companies and minority-owned businesses. Finding them is difficult, Cornelius said, so EBidboard provides a directory.

Also, contractors can review projects online to decide if they are worth bidding on. In the traditional method, the contractor would have to go to the public agency and spend a few hundred dollars on plans before knowing if it is likely to bid on the project.

When Cornelius worked for Malcolm Drilling Co., a San Francisco-based general engineering contractor with an office in Vista, he said he would send price quotes to five contractors when seven were bidding on a project. The company would lose work because it didn't know about the other two.

"I can look at it before we go out and buy the plans. (Otherwise) I can spend $400 on the plans, then there's only $1,000 worth of supplies," said Cliff Reichel, sales director at Marden Susco in San Marcos.

The pipe, valve, and fittings supplier has been using eBidboard for seven months. The Web site helps Marden Susco find more customers and narrow down the projects it bids on.

Marden Susco still uses other traditional sources for finding prospective bids, such as print publication called the Dodge Report and Bid America.

Bill Sharp, president of San Diego general contractor Douglas E. Barnhart Inc., said the company has not bought a subscription to eBidboard but it is under consideration.

Currently, Barnhart uses standard construction industry publications to find public bid requests like the publication Construction Market Data and an online service called the Daily Construction Reporter.

While he admitted he does not know a lot about eBidboard, Sharp said he is intrigued by the feature that provides historical data on past bids. It helps contractors keep an eye on prices charged by their competitors.

Sharp explained that contractors race against each other to find bids first.

"We're constantly trying to lower our numbers," he said.

Contractors are becoming educated about how they can work together more efficiently, Sharp explained. Instead of putting together a "shotgun marriage" for a bid, they can offer construction management services to put together a team early on in the process.

"We still hard bid about 25 percent of our work. We have concrete and framing crews we want to keep busy," Sharp said.

The San Diego Daily Transcript publishes public bid advertisement. It has offered a plan room at its Bankers Hill office for 30 years and created an online version two years ago.

Chris Tran, director of marketing and public relations for the Transcript, said the newspaper's Web site is connected to a statewide network.

The online plan room allows contractors to find projects in their area of expertise by conducting a keyword search. Subscriptions are $495 per year or $43 per month. Contractors can also buy plans online.

Public projects advertised in the print edition of the Transcript also are listed in the online plan room.

"Everything's about providing convenience. With that they can work in the field, from home, or in the other offices," Tran said.

The online plan room helps contractors cut costs, as well, she noted, because they can preview plans before they buy them.

Gilchrist said San Diego doesn't use the Transcript's online plan room, although the newspaper has access to the city's plans and specifications. The city can't gauge how may contractors use eBidboard because it does not accept electronic bids.

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