Tender Bid Price Calculator

Work out tender bid price instantly with clear inputs, formula shown and shareable results.

About Tender Bid Price Calculator

A tender price builds up from direct cost through overhead recovery and a risk allowance, then grosses up for margin. Grossing up is essential: adding an 8% margin to cost yields only 7.4% of the bid price, so bids priced that way systematically under-recover.

Formulas

Fully loaded cost

Cost = Direct cost x (1 + Overhead %) x (1 + Risk %)

Bid price

Bid = Loaded cost / (1 - Target margin %)

Worked example

With the default values below, Tender Bid Price Calculator returns Bid price to submit of $2,322,782.61. Change any input above and every figure here is recalculated in your browser.

Inputs used

Direct cost of the work: 1,800,000
Overhead recovery: 12
Risk and contingency: 6
Target margin on bid price: 8

Results

Bid price to submit: $2,322,782.61
Fully loaded cost including risk: $2,136,960.00
Margin in the bid: $185,822.61
Total markup on direct cost: 29.04%

Step by step

1Values used
2Fully loaded cost
3Bid price
4Bid price to submit= 2,322,782.61
5Fully loaded cost including risk= 2,136,960.00
6Margin in the bid= 185,822.61
7Total markup on direct cost= 29.04

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation, tax or compounding frequency into account.
Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How should I size the risk allowance?

From the specific risk register: price the exposures you have identified rather than applying a flat percentage, and disclose which ones are excluded.

Should I bid below cost to win work?

Only with a clear, quantified reason — keeping a critical team intact, or a follow-on contract you can evidence. Otherwise it destroys value and resets the client's price expectation.