Small Construction Business

[Carboholic]

We were awarded a job through the city for $300K, and they required a performance bond in order to proceed. Unfortunately, we were unable to qualify for a bond due to insufficient financial strength and had to turn down the job. This was the first time we had gone after a city contract like this and were disappointed on having to pass up the opportunity.

What steps would you recommend us to take in order to establish ourselves enough to qualify for bonding, so in the future we can bid on larger jobs?

[Admin]

The obligee allowed you to bid without a bid bond? Or are you a sub-contractor that is required by a GC to post a bond?


In order to increase you bond line, a bonding company is going to want to see you crawl before you walk or run. Therefore, you have to start small and build their confidence by completing larger jobs in time while adding financial strength to your business financials. This can get quite complicated, it would be best to call an agent to discuss, so he/she can help you develop a strategy for your surety credit.