Legal Definitions - bid

A bid is an offer to do a job or provide materials at a certain price. The person making the bid is called the offeror, and the person receiving the bid is called the offeree. The offeree can choose to accept or reject the bid.

• Bid peddling: This is when a subcontractor chooses not to bid on a job, but waits for another subcontractor to pay for the estimate and make an offer. Then, the first subcontractor offers to do the job for a lower price. This is not fair to the subcontractor who paid for the estimate, and it can be illegal.
• Bid shopping: This is when a general contractor receives a bid from one subcontractor, but then pressures other subcontractors to submit lower bids. This is not fair to the subcontractors, and it can lead to lower quality work.
• Bid rigging: This is when competitors work together to raise prices for their goods or services. This is illegal because it is a violation of antitrust laws.

These examples show how bids can be used unfairly. Bid peddling and bid shopping are both examples of unfair competition, while bid rigging is illegal. It is important for bids to be made fairly and honestly, so that everyone has a fair chance to get the job.