Oregon Construction Contractors (CCB) Practice Test

What is the term for when a general contractor seeks lower offers from subcontractors after original bids have been submitted?

1. Bid collusion

2. Bid shopping

3. Bid rigging

4. Bid solicitation

The correct answer is: Bid shopping

The correct term for when a general contractor seeks lower offers from subcontractors after original bids have been submitted is known as bid shopping. This practice typically involves a general contractor using the initial quotes they received to negotiate better prices with subcontractors, effectively shopping around for the best possible deal. Such actions can undermine the competitive bidding process as it may pressure subcontractors to cut their prices below their original bids, potentially compromising quality or service. Bid shopping can create an unbalanced market where subcontractors may feel compelled to undercut their initial bids to remain competitive. It's important to note that this practice can lead to ethical concerns and may negatively impact the relationships between contractors and subcontractors. The other terms listed describe different practices: bid collusion refers to a situation where parties coordinate their bids to manipulate the outcome, bid rigging involves deceitful practices to ensure predetermined winners, and bid solicitation pertains generally to the process of inviting bids without the implications of negotiating or seeking lower offers after the fact. Understanding these distinctions is crucial for anyone involved in construction contracting to maintain fair and ethical practices.