bids

A bid is an offer made by a person or entity to purchase something at a stated price or to execute work under specified terms. In auctions, bidders submit bids as prices; the highest or most favorable bid determines the winner depending on auction format. Common formats include ascending price (open outcry), descending price (Dutch auction), and online or proxy bidding, where participants place bids without being present and a mechanism automatically raises bids up to a maximum.

In procurement and construction, a bid (or tender) is a vendor's response to a solicitation in which the price and terms to supply goods or services are proposed. Bids are typically evaluated on price and compliance with specification, with other factors such as delivery time, quality, and after-sales support considered. Many processes require sealed bids to prevent disclosure of competitors’ offers, and a bid security or bid bond may be required to deter non-performance or non-submission.

Bid evaluation results in contract award to the bidder that meets mandatory requirements and offers best value, which is not always the lowest bid. Depending on jurisdiction, the contract is formed when the bidder's offer is accepted and the bid is deemed a binding proposal.

Other terms include standing offers or framework agreements, where a bid establishes a price for ongoing orders over a period; bid bonds, performance bonds, and liquidated damages may be used to manage risk.

Ethical and legal considerations include prohibitions on bid rigging and collusion, which are illegal in many jurisdictions and can lead to penalties.