Withdrawal of bid: Overview, definition, and example
What is withdrawal of bid?
Withdrawal of bid means taking back an offer that was submitted—usually during a tender, proposal, or bidding process—before it has been officially accepted. It’s basically saying, “We’re no longer making this offer,” and removing yourself from consideration.
In most cases, once a bid is withdrawn, it’s off the table. The other party can no longer accept it, and you’re not bound by it anymore—so long as you followed the rules around timing and process.
Why is withdrawal of bid important?
Sometimes things change after a bid is submitted—costs go up, timelines shift, or new information comes to light. Being able to withdraw a bid gives you flexibility to step back before committing to a deal you can’t follow through on.
But it’s also something to handle carefully. Some tenders have strict rules about when or how a bid can be withdrawn. Missing a deadline or breaking those rules could damage your reputation—or even lead to legal or financial consequences. A clear understanding of how withdrawal works helps you avoid these risks.
Understanding withdrawal of bid through an example
Imagine you run a construction company and submit a bid to build a new office space for a local business. A few days later, your main supplier notifies you of a major price hike for materials, which would make your bid unprofitable.
You decide to withdraw your bid before the business accepts it. Because you acted before any formal acceptance, and you followed the instructions for withdrawal laid out in the bid request, you're free to back out without penalty.
But if you tried to withdraw after your bid was accepted—or without following the rules—you could be held liable for breaching the bidding process or even sued for damages.
An example of a withdrawal of bid clause
Here’s how a withdrawal of bid clause might appear in a contract or tender document:
“A Bidder may withdraw its Bid at any time before the Bid Submission Deadline by providing written notice to the Procuring Entity. After the Submission Deadline, withdrawal is permitted only with the written consent of the Procuring Entity. Any Bid withdrawn after acceptance shall be subject to forfeiture of bid security or other applicable penalties.”
Conclusion
Withdrawal of bid gives you the chance to back out of an offer before it becomes a binding contract—but only if you do it properly and on time.
Whether you're bidding for a project, submitting a proposal, or responding to a tender, always check the rules about how and when you can withdraw your bid. Done right, it protects your business from entering into commitments you can’t fulfill. Done wrong, it could cost you time, money, or trust.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.