UNDERSTANDING BILLS OF QUANTITIES

Introduction

One of the greatest advantages a contractor can have during tendering is a thorough understanding of the Bill of Quantities (BOQ).

Unfortunately, many contractors view the BOQ merely as a pricing document. They focus on filling rates into blank spaces without fully understanding what the document is communicating.

This approach creates risk.

A well-prepared BOQ is much more than a list of items. It is a roadmap of the project. It provides insight into the scope of work, procurement requirements, labour demands, construction sequence, and cash flow expectations.

Contractors who understand the BOQ can price with confidence, identify risks earlier, allocate resources more effectively, and improve profitability.

This chapter explains how to read, interpret, and use Bills of Quantities as a project management tool rather than merely a pricing document.

What Is a Bill of Quantities?

A Bill of Quantities is a document that describes, measures, and quantifies the work required to complete a construction project.

The BOQ serves several purposes:

• Provides a common basis for tender pricing.
• Enables fair comparison between bidders.
• Assists cost planning and budgeting.
• Supports valuation of completed work.
• Forms part of the contract documentation.

Simply stated, the BOQ answers three questions:

1. What work is required?
2. How much work is required?
3. How will that work be measured for payment?

Why Contractors Must Understand the BOQ

Many contractors focus exclusively on the total tender amount.

Professional contractors focus on understanding the composition of that amount.

The BOQ allows contractors to:

• Identify high-value work packages.
• Plan procurement activities.
• Estimate labour requirements.
• Forecast cash flow.
• Allocate equipment resources.
• Evaluate project risks.

A contractor who understands the BOQ is effectively looking into the future of the project.

Typical Structure of a BOQ

Although formats vary across countries and projects, most BOQs contain similar sections.

Preliminaries

Preliminaries include project-wide obligations that are not directly related to specific construction activities.

Examples include:

• Site offices
• Temporary works
• Security
• Site supervision
• Insurances
• Mobilization
• Demobilization

One common mistake is underpricing preliminaries.

Contractors often focus heavily on production work while forgetting that preliminaries continue throughout the life of the project.

Measured Works

Measured works form the bulk of most BOQs.

Examples include:

• Excavation
• Concrete
• Reinforcement
• Masonry
• Roofing
• Finishes

These items are measured in defined units and paid according to completed quantities.

Provisional Sums

A provisional sum is an allowance included for work that cannot be fully defined at tender stage.

Examples include:

• Specialist installations
• Utility relocations
• Landscaping
• External works

The actual value of provisional sum work may increase or decrease during the project.

Contractors should understand that provisional sums do not automatically represent profit opportunities.

Prime Cost Sums

Prime Cost (PC) sums are allowances for materials or services that will be selected later.

Examples include:

• Sanitary fixtures
• Tiles
• Light fittings
• Specialist equipment

Contractors should carefully review what is included and excluded in PC sums to avoid misunderstandings.

Understanding Measurement Units

Every BOQ item is measured using a specific unit.

Understanding these units is essential for pricing accurately.

Cubic Metres (m³)

Typically used for:

• Excavation
• Concrete
• Backfilling

Example:

100 m³ of concrete does not simply represent material volume.

It also requires:

• Labour
• Formwork
• Equipment
• Transport
• Supervision

Square Metres (m²)

Commonly used for:

• Plastering
• Painting
• Flooring
• Roofing

Contractors should verify dimensions from drawings rather than relying solely on quantities provided.

Linear Metres (m)

Used for:

• Pipes
• Kerbs
• Fencing
• Cable trenches

Production rates can vary significantly depending on site conditions.

Number (Nr)

Used for discrete items such as:

• Doors
• Windows
• Light fixtures
• Pumps

Contractors must ensure all installation requirements are included within pricing.

How Quantities Are Measured

Many countries use formal measurement standards.

Examples include:

• Standard Method of Measurement (SMM)
• New Rules of Measurement (NRM)
• Civil Engineering Standard Method of Measurement (CESMM)

Regardless of the system used, contractors should understand that quantities are measured according to specific rules.

Failure to understand measurement rules often leads to pricing errors. These standards can also be found online.

Linking the BOQ to Drawings

One of the most important tendering exercises is cross-checking BOQ items against drawings.

Questions every contractor should ask:

• Does every major drawing element appear in the BOQ?
• Are quantities reasonable?
• Are specifications reflected correctly?
• Are there missing items?

This process frequently reveals discrepancies that can significantly affect pricing.

The Danger of Blindly Trusting Quantities

Many contractors assume BOQ quantities are perfect. This assumption is dangerous.

While quantities are generally prepared by professionals, errors can occur.

Common issues include:

• Omissions
• Duplication
• Incorrect dimensions
• Measurement mistakes

Professional contractors perform independent checks on critical items.

Trust the BOQ, but verify it.

Building Rates Correctly

Every BOQ item requires a rate. That rate should be built systematically.

Labour Cost

Calculate:

• Crew size
• Productivity
• Working hours
• Labour rates

Material Cost

Consider:

• Purchase price
• Transport
• Waste allowances
• Storage costs

Equipment Cost

Include:

• Fuel
• Maintenance
• Operator costs
• Depreciation

Site Overheads

Examples include:

• Site management
• Security
• Temporary facilities

Profit and Risk

Every rate should include:

• Desired profit margin
• Risk allowance

Without profit, the contractor is simply providing employment rather than building a business.

BOQ Analysis for Project Planning

The BOQ is not only useful during tendering. It becomes a valuable project management tool.

Contractors can use it to:

• Develop work breakdown structures.
• Create procurement schedules.
• Forecast resource requirements.
• Monitor project costs.
• Measure progress.

The best contractors continue using the BOQ long after the tender has been submitted.

Case Study: The Missing Waterproofing Item

A contractor submitted a competitive tender for a commercial building. During construction, waterproofing requirements became apparent.

The contractor assumed waterproofing was included elsewhere in the BOQ.

The client argued that the contractor should have identified the requirement from the drawings.

The contractor absorbed the cost.

The project remained technically successful but generated substantially lower profit than expected.

Lesson:

Always compare drawings, specifications, and BOQ items before pricing.

Practical BOQ Review Checklist

Before submitting any tender:

• Review every BOQ section.
• Compare BOQ items against drawings.
• Verify major quantities.
• Check provisional sums.
• Check prime cost sums.
• Identify missing scope.
• Confirm measurement units.
• Build rates systematically.
• Include risk allowances.
• Review assumptions.