Glossary

Contractor bid & restoration terms, in plain English

The words that quietly decide whether a bid is a good deal — defined for property managers who don't work in construction.

Scope gap

A scope gap is required work that one contractor bid leaves out while others include it — a permit fee, debris disposal, or patch-and-paint that quietly shifts to the property owner. Scope gaps are why the lowest bid often isn't the lowest cost: the missing work returns later as a change order. Read more →

Bid leveling

Bid leveling is adjusting competing bids so they all cover identical work before their prices are compared. General contractors call it bid leveling; property managers usually call it bid tabulation or scope normalization. The mechanic is the same: put every bid on one common scope so the price comparison actually means something. Read more →

Exclusion

An exclusion is work a contractor states it will not perform at any price — permits, disposal, code upgrades, or access work someone else must cover. Exclusions create scope gaps: the work still has to happen, so its cost lands on the owner. Reading the exclusions list is how you catch a deceptively low bid. Read more →

Allowance

An allowance is a placeholder dollar amount a contractor includes for work whose final cost isn't known yet — for example, $4,000 for flooring the owner hasn't selected. The work is in the contract, but the price isn't locked. Allowances create budget risk: the final number can climb once the real selection is made. Read more →

Contingency

A contingency is a reserve amount set aside for unknowns that surface once work begins — hidden water damage, failed substrate, or conditions no one could see at bid time. Unlike an allowance, a contingency isn't tied to a specific line item; it's a buffer against surprises, and it's spent only if a real unknown appears. Read more →

True cost (normalized bid)

True cost is a bid's headline price plus the market value of any required scope it leaves out. It's the number you get after scope normalization — what each bid would actually cost to finish the whole job. Comparing true costs, rather than sticker prices, is what stops a cheap-but-incomplete bid from winning on paper. Read more →

Change-order exposure

Change-order exposure is how likely a bid's price is to grow after you sign it. It comes from vague language, allowances instead of firm pricing, 'as needed' items, missing unit prices, and excluded scope. High exposure means the number on the bid is a starting point, not the final cost — which is exactly what a budget can't absorb. Read more →

Apples-to-apples comparison

An apples-to-apples comparison means every bid covers identical scope, so the only thing that differs is price. Raw contractor bids are almost never apples-to-apples — each describes slightly different work. You make them comparable through scope normalization: mapping every line item across bidders and pricing the gaps before comparing any totals. Read more →

True cost (normalized bid)

A bid's sticker price plus the value of any required scope it leaves out — so a cheap bid can't win just by doing less. Read more →

Scope of work

The definition of what a project must include — the yardstick that turns three confusing bids into an apples-to-apples comparison. Read more →

Change order

A mid-job increase to the contract price for work not in the original bid — usually predictable from the bid before you sign. Read more →

Allowance

A placeholder dollar figure for work the contractor hasn't actually priced yet; overages come back to you. Read more →

Supplement

A request to the carrier to adjust the settlement for scope the original estimate missed — legitimate for real hidden damage, a red flag when used to book a job low. Read more →

RCV vs. ACV

Replacement Cost Value is the full repair cost; Actual Cash Value is that minus depreciation. Knowing which you hold changes whether a bid looks affordable. Read more →

Xactimate

The estimating software most carriers use to price insurance repairs — you don't write one, you read one as your baseline scope. Read more →