Critical Factors Influencing the Bid/no-Bid Decisions of Small and Medium-Sized Contractors in Sri Lanka

Abstract

ABSTRACT The significance of the factors influencing bid/no-bid decisions varies significantly depending on the organization’s size and geographical region. The present study examined the critical factors influencing the bid/no-bid decisions of small and medium-sized contractors in Sri Lanka. Primary data were collected from 160 small and 118 medium-sized contractors in Sri Lanka through a questionnaire survey. The respondents were requested to rate the relative importance of 43 factors, and consequently, critical factors were identified. In-depth interviews with six industry experts were conducted to obtain a deeper understanding of the critical factors. Small-sized contractors perceived project size, availability of capital, timeliness of client in the payments process, current workload, and general overhead as the five most critical factors in the bid reasoning process. In contrast, medium-sized contractors deemed project size, current workload, type of project, availability of qualified staff, and duration of project vital in their bid/no-bid decision reasoning process. This study’s findings bridge the literature gap by prioritizing the factors most relevant to small and medium-sized contractors’ bid/no-bid decisions in South Asia. The study further qualitatively assessed the critical factors and added insight into the governing mechanisms behind the critical factors, an area often neglected in the literature.