Invitation For Bid - IFB

AAA

DEFINITION of 'Invitation For Bid - IFB'

When a company or organization provides detailed project specifications and allows contractors to send in their proposals indicating how much the project will cost to complete. Because the focus of the invitation for bid is on the bidder's price for project completion, there is less emphasis on the bidder introducing its own ideas. This separates the IFB from a request for proposal (RFP).

INVESTOPEDIA EXPLAINS 'Invitation For Bid - IFB'

Companies typically choose the qualified bidder with the lowest bid. Going with the lowest bid can result in issues if the contractor isn't of sufficient quality, so it is important for the company creating an IFB to be very clear in what qualifications a bidder should possess and what the project specifications are.


Because a well-written IFB does not focus on the bidder producing ideas, the bidder can focus on the potential costs associated with completing a project and can produce a bid faster.

RELATED TERMS
  1. Contractor Fraud

    Illegal business practices committed by firms hired to reform, ...
  2. Bilateral Contract

    A bilateral contract is a reciprocal arrangement between two ...
  3. Independent Contractor

    A self-employed taxpayer that controls his or her own employment ...
  4. Bid

    1. An offer made by an investor, a trader or a dealer to buy ...
  5. Business Credit Card

    A credit card intended for use by a business rather than for ...
  6. Accelerated Dividend

    Special dividends paid by a company ahead of an imminent change ...
Related Articles
  1. Insurance

    Understanding Your Insurance Contract

    Learn how to read one of the most important documents you own.
  2. Personal Finance

    How To Pick The Right Lawyer

    Find out what factors to consider before hiring an attorney.
  3. Investing

    Corporate Governance

    Corporate governance refers to the formally established guidelines that determine how a company is run. The company’s board of directors approves and periodically reviews the guidelines, which ...
  4. Investing

    What does DDP Mean?

    Delivery duty paid (DDP) is a shipping term specifying that the seller is responsible for all costs associated with delivery of the goods to the buyer. It is usually used when goods are exported ...
  5. Professionals

    Advertising, Crocodiles And Moats

    Memorable advertising is a brick in the fortress that keeps competitors at bay.
  6. Investing Basics

    Unbundling

    Unbundling is what happens when a parent company with a few lines of business decides to keep its core businesses and sell the rest of its assets, product/service lines, divisions or subsidiaries. ...
  7. Investing

    Overseas Cash Hoards: Shareholder Boon Or Taxpayer Burden?

    American corporations are holding something in the neighborhood of $1.5 trillion in cash in the coffers of their offshore entities, usually to avoid tax liability. Needless to say, not everyone ...
  8. Retirement

    Consumer Confidence: A Killer Statistic

    The consumer confidence is key to any market economy, so investors need to learn the measures and how to analyze them.
  9. Personal Finance

    Scrooge-Like Actions Of CEOs

    Sometimes CEOs of big corporations aren't as generous and giving as most people would expect them to be.
  10. Personal Finance

    Athletes Who Make More From Endorsements Than Sports

    When an athlete becomes a one-person brand, he or she can make more from endorsements than the sport he or she is famous for playing.

You May Also Like

Hot Definitions
  1. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  2. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  3. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  4. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  5. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  6. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
Trading Center