In construction industry, we know that there are fixed costs and estimated costs. Fixed costs are the costs which we can calculate and price them, this includes materials, labour, plants and equipments cost. Sometimes contractors called it as direct costs. While estimated costs are the costs which due to their unpredictability and uniqueness, we cannot calculate and price them precisely. Preliminaries is one of the latter’s example. Preliminaries in construction industry can be defined as requirements/components/facilities which are need to be provided prior to commencement of actual implementation of physical work. But this is the general definition of preliminaries.
Now, what items which are constituted the preliminaries? Following are the items that normally will be considered by the contractors for many projects as preliminaries:
|1||Site Supervision – Site Agent, etc||13||Protection and casing of finished work|
|3||Code of welfare conditions||15||Telephone|
|4||Temporary roads||16||Temporary compounds|
|5||Temporary fencing, hoardings, screens, gantries and walk-away||17||Notices and fees to local Authorities and Public Undertakings|
|6||Setting out||18||Attendance on clerk of works|
|7||Watching and lighting||19||Temporary Power and Site Lighting|
|8||Insurances||20||Travelling time fares|
|9||Additional overtime||21||Transportation to site|
|10||Maintenance of the public and private roads||22||Temporary offices, storage sheds, man store|
|11||Weather protection and precautions||23||Cleaning out Buildings|
|12||Testing materials||24||Temporary water on site|
Preliminaries & Contingency: The Differences
The definition of preliminaries is different with contingencies. Contingency is an estimated allowance for the cost of unknowns or changes. It also includes escalation and estimating error. So basically it is an anticipated allowance for any cost which may be incurred during the construction process. It can vary in amount depend on the project size and type. While preliminaries are estimated allowance for the cost of things which are known but we cannot priced them precisely due to their uniqueness and vastness.
Preliminaries & Overhead: The Differences
Overhead is defined as indirect expenses that cannot be charged to individual costs or bid items. Overhead covers items such as directors, secretariat, marketing, equipment not only for project necessity but also for headquarters necessity. Usually the overhead is expressed as a percentage and added to tender cost. Since it cannot be charged as an individual cost, we cannot find this item in Bill of Quantities. While preliminaries as a cost can be find in Bill of Quantities.