Exploring Bill of Quantities: Everything You Need to Know

What separates a successful construction project from a failed or break-even build?

One of the most critical aspects to consider is thorough planning. Efficiency, cost control, and intelligent resource allocation all start with a carefully thought-out plan. Of course, a plan begins with a comprehensive list of the work that needs to be carried out. After all, the entire project depends on having an accurate assessment of all the components that will bring it to life.

That is where a Bill of Quantities (BoQ) comes in. This invaluable document provides descriptions and firm quantities of the work comprised in a contract. It is also a crucial tool during the bidding process.

This RIB blog post will explore BoQ importance, advantages, best practices, and much more.

Bill of Quantities Key takeaways:

• A Bill of Quantities (BoQ) is a document listing the items and quantity of work required to complete a construction project.
• A detailed BoQ benefits both project owners and contractors during the tendering process by providing a standard format for bid comparisons and making any information gaps requiring clarification readily apparent.
• A digital Bill of Quantities linked to a Building Information (BIM) platform and other real-time construction databases improves transparency, estimation accuracy, and cost control, while eliminating error-prone manual updates.  
• Important elements included in a standard BoQ format include the summary, preliminaries, measured work, provisional sums, credits, and dayworks, with each section covering useful item descriptions and subtotals.
• Modern construction software allows a BoQ to be updated automatically when inevitable design, scope, task, or material changes occur, then shared with all relevant stakeholders to prevent communication lags.
• While quantity surveyors, estimators, and contractors must understand how to prepare a Bill of Quantities, additional stakeholders, including architects, material suppliers, and specialists, benefit from the comprehensive and universal format.

What Is a Bill of Quantities?

A Bill of Quantities (BoQ) is a document listing the items and quantity of work required to complete a project. It includes a description and a measure that allows the work to be priced, and it is handed over to contractors as a key element of the tender documentation.

The RICS’s New Rules of Measurement 2 (NRM2) defines a Bill of Quantities as “a list of items that gives detailed identifying descriptions and firm quantities of the work comprising a contract.” This is illustrated in the image below, showing a BoQ in RIB Candy software.

The work described in the BoQ is defined using different Methods of Measurement, each with a set of rules identified by the item descriptions. The chosen method specifies how the work should be categorized, which is typically by trade.

Generally, BoQs are drawn up by the quantity surveyor, an architect, or an engineer after the project design and specifications are completed. BoQs are mainly used in construction for large, complicated projects requiring a more complex tendering process.

Usually, bidding contractors receive the BoQ as part of the tender documents. This ensures all contractors are pricing the work based on the same information, allowing for easier and faster bid comparisons. This makes an accurate construction Bill of Quantities valuable for both the project owner and the contractor.

The construction BoQ provides sufficient information for the tenderers to calculate costs, such as the manufacturing and delivery of materials, plant, labor, and other associated costs. Contractors might also do their own independent quantity remeasurements using modern 3D takeoff software. If discrepancies are found, the contractor may submit a Request for Information (RFI) to the owner’s Consultant or Engineer to clarify.

From the owner’s perspective, a BoQ reassures owners that every aspect of the project is accounted for, allowing for accurate cost forecasting, interim valuations, and budgeting throughout the project.

Importance & Purpose of Bill of Quantities

Now that we have explored the definition, let’s examine the benefits and importance of a Bill of Quantities.

Simplified and efficient tendering

One of the main benefits and purposes of a Bill of Quantities is to ensure an accurate and fair bidding process. When competing contractors price construction work on the same basis, this reduces the risk of ambiguity through omissions or misunderstandings. It also saves owners time when they review and analyze bids during the construction procurement process.

Planning & scheduling

A BoQ in construction enhances planning and scheduling by linking information about the work to be completed directly to the time-driven project plan. Accurate BoQ information helps to deliver the project within the expected timeline, improve visibility, and avoid waste.

Communication, accountability & transparency

A BoQ provides a comprehensive overview of works, which makes it the perfect tool to promote effective communication, accountability, and transparency between the owner and the contractor. An organized layout of tasks and costs reduces the chance of mistakes or misunderstandings, while boosting accountability and transparency. The BoQ is also a reliable resource for valuing variations, interim payments, and the final account.

Cost control

A BoQ in construction provides project owners and contractors with improved cost control. A detailed overview of items and their prices helps identify the costliest ones and look for alternatives to safeguard the budget. During construction, upcoming expenses, resource constraints, and unexpected modifications are more easily managed using the BoQ as a baseline.

Analysis, collection & storage of cost data

Once the BoQ is priced, it serves as an invaluable source of cost data. Quantity surveyors or cost professionals can use a priced BoQ to provide professional advice about the potential costs of future building projects. The cost data from a priced BoQ can be easily stored and retrieved to support upcoming estimation or benchmarking tasks.

Risk management & contingency planning

A well-structured BoQ provides a detailed breakdown of the work to be carried out, facilitating the early identification of potential challenges and the implementation of construction contingency plans. For example, a specific task like excavation and earthworks, historically more prone to error or changes, might need an exclusive contingency budget.

Composition of a Bill of Quantities

Understanding a construction Bill of Quantities is essential for anyone involved in planning, estimating, or procurement.

A form of tender is a separate document where the tenderer can provide details about their proposal, including name, address, and tender price. If the tenderer wins the bid, the tender price will become the “contract sum”.

In some cases, an additional document called a “certificate of bona fide tender” might be included as a commitment that the main contractor has not communicated their tender to other parties.

The composition might vary for different projects, measurement standards, and software providers. However, for this post, we will use the standardized structure from the RICS New Rules of Measurement 2 (NRM2) to explain the key BoQ elements:

• Form of tender is a separate document where the tenderer can provide details about their proposal, including name, address, and tender price. If the tenderer wins the bid, the tender price will become the “contract sum”. In some cases, an additional document called a “certificate of bona fide tender” might be included as a commitment that the main contractor has not communicated their tender to other parties.
• The summary section comprises all the individual sections of the BoQ, with totals for each section, such as preliminaries, measured works, provisional sums, etc., along with the same grand total found in the Form of Tender. 
• Preliminaries include information and requirements regarding items that are not directly related to a work section, such as security, safety, environmental protection, and site administration, and overhead costs.
• Measured work is the most important component of a BoQ, since it includes all the work items to be completed, with a detailed description, units of measurement, and quantities. Examples might include excavations, concrete placement, and masonry, depending on the project.
• The risks section lists residual risks the owner wants to transfer to the contractor, such as the disposal of contaminated material, asbestos removal, or flooding, just to name a few.
• Provisional sums are allowances for work that is anticipated to happen but was not included in the design documents during tendering.
• Credits are deductions in the total contract price to account for salvaged materials, such as copper piping, or other components with residual value that are retained by the contractor to be sold or reused.
• Dayworks are typically included when unexpected, minor, or urgent work items arise that weren’t initially included in the BoQ or cannot be measured in advance.
• Annexes or appendices are additional documents like drawings, specifications, and schedules included at the end of the BoQ to provide supporting information, especially for large or complex projects.

Types of Bill of Quantities

When learning how to prepare a Bill of Quantities template, you must understand the differences between standard types of BoQs used in the construction industry. The RICS NRM2 recognizes two kinds; the one you use will depend on the size and nature of the project and the requirements of the different stakeholders involved.

Let’s explore them below!

Firm Bill Of Quantities

A firm BoQ is used to obtain a lump sum price, which means the fully designed project is priced at a fixed amount. The work items need to be described and measured with the utmost accuracy to ensure the tendered prices are fully reliable. Theoretically, if no design changes are recorded during the project, the price agreed at the tender stage will be the same at the closing stage. In practice, it is unlikely that the project won’t have any changes, so the firm BoQ serves as a great point of reference to assess changes based on defined rates.

Approximate Bill Of Quantities

As the name implies, an approximate BoQ is used when there is not enough information to provide definitive details about measurements and quantities. An approximate BoQ might be selected if the project design is still somewhat incomplete or the client decides it is not necessary to generate a firm BoQ. In this type of contract, contractors do not provide a lump sum price but a quantified schedule of rates (SoR).

When utilizing an approximate BoQ, contractor selection can be completed faster. However, the approximate quantities and measurements can result in more variation and re-measurement that adds uncertainty. Generally, the use of approximate BoQs is only recommended when there is genuine uncertainty about some works, such as excavations or earthworks.

How To Prepare a Bill of Quantities

We’ve learned the definition, benefits, and types of Bill of Quantities. Now, you might be wondering, how do I actually generate a BoQ? Preparing a bill of quantity involves several steps. The quantity surveyor will usually prepare the document during the preconstruction phase using professional quantity surveyor software. Let’s explore the steps you should follow to ensure success.

Define the scope of work and collect documentation

The first step in preparing a BoQ for construction is meeting with all relevant parties using effective construction communication to define the work scope, contract type, and associated terms and conditions. You must also collect and review all relevant documents from the project design, such as architectural plans, engineering drawings, construction specifications, and design criteria to build a foundation for your BoQ.

Break down the work into items and measure them

Once you’ve collected all the documents, you can start breaking down the work into items and measuring according to the rules of your chosen Measurement Method.

Construction tools like Candy estimating software are incredibly useful for formatting and organizing the categories within your BoQ. Contractors can easily import their Bill of Quantities into RIB Candy, manually add items, allocate trade codes, and price bill items using plug rates, split plug rates, and free-format rate sheets. Using software, contractors can also ensure that their layouts are consistent and have all the necessary columns.

Define, check, and verify the quantities

A standard BoQ comprises a list of items (with a number and a description), a measurement unit, the quantity, the cost per unit, and the total cost per item. You can define quantities for all project items manually, or by utilizing BIM takeoff & estimating tools, such as RIB CostX software. Integrated tools automatically modify the BoQ if the model is updated, reducing the need for manual calculations and human error. The image below shows an example of a Bill of Quantities in CostX, where we see all the elements mentioned previously.

This tool also allows users to import data from an Excel spreadsheet into an RIB CostX workbook. This is incredibly valuable when a contractor receives an unpriced BoQ from a client, since the spreadsheet can be imported into an RIB CostX workbook to streamline the addition of cost information within the software.

Draw up the BoQ with preliminaries

Once you start putting your BoQ together with the measurements and quantities you defined, don’t forget about preliminaries. Examples of preliminaries include method statements, preconstruction information, client reporting requirements, quality management procedures, subcontracting methods, and insurance requirements, among many others.

The RICS NRM2 divides preliminaries into two sections. The first one, called Information and Requirements, describes the project in general and any particular requirements from the owner. The second one, called the Pricing Schedule, is where the contractor describes preliminary costs related to the owner’s requirements and contractor cost items like management and staff, site accommodation, etc.

Assess compliance

Check that your BoQ complies with the Method of Measurement on which it was based to ensure clarity and eliminate risk of misinterpretation. There is currently a wide variety of BoQ standards. Some are region-specific, like the New Rules of Measurement 2 (NRM2) used in the UK or the CSI MasterFormat, a standardized classification system mainly used in North America.

Review and approve the BoQ

The last step is to thoroughly review your BoQ compared to the rest of the tender documents, i.e., drawings and specifications. This will avoid future disputes with the bidding contractors, making the tendering process more time—and cost-efficient.

Luckily, modern construction software solutions assist you in ensuring your Bill of Quantities is accurate and error-free.

Common Mistakes & Challenges When Preparing a BoQ

Even experienced professionals can make costly errors when preparing or interpreting a Bill of Quantities. These mistakes can detrimentally impact the budget and timeline. Below are some of the most common pitfalls and challenges to watch out for.

Inaccurate quantity takeoffs

A construction quantity takeoff (QTO) is a process where all the quantities of materials, labor, and other resources are calculated to determine the amount of each item required. The information gathered in the QTO is then used to generate the BoQ.

An inaccurate takeoff can lead to significant errors in the BoQ that can cause critical components of the project to be under- or overestimated, leading to contract disputes, budget overruns, or delays. Consistent quality checks, digital takeoff tools, and experienced estimators are vital to minimizing errors and accurately quantifying measured work.

Managing changes across the project

Changes and modifications, like client variations, design updates, or unforeseen site conditions, are inevitable in building projects. When they occur, the BoQ must be adjusted accordingly to maintain accuracy and avoid potential issues or disputes. Professional software tools foster smooth communication and automated updates to ensure documentation is always up to date.

Overlooking risk factors

Part of effective construction change management is proactively preparing for potential risks that can affect the budget. Contingency budgets are included in the contract to cover any eventualities, avoid potential budget overruns, and promote financial stability throughout project execution. Accounting for potential risks also ensures the BoQ provides a more realistic and resilient framework for project success.

Outdated rate and price data

Ongoing fluctuations worldwide make it challenging to keep up with the latest prices for labor and materials. When a BoQ is prepared with obsolete data, unit prices assigned to work items no longer accurately reflect current market realities, which can significantly affect profitability. Regularly updating pricing databases, benchmarking against industry standards, and using professional software to link BoQs with real-time information helps to mitigate this challenge.

Not being detailed enough

BoQs play a crucial role in effective contract management, so they must be drafted with sufficient detail and precision to prevent misunderstandings. To avoid interpretation issues, it is recommended to take the time necessary to draft an accurate and thorough BoQ. A detailed construction Bill of Quantities will ensure the project owner, contractors, and other stakeholders fully understand what is required.

The Role of a Bill of Quantities in Modern Construction

The construction industry is known for its highly complex and unique projects, along with a traditionally hesitant approach to software and technology adoption that once lagged behind other industries. As digital methods become the norm, the construction Bill of Quantities has emerged as an important centerpiece of more agile and successful projects.

Digital construction workflows

Construction workflows that once relied on manual drawings, measurements, and calculations have evolved to include technologies like live-linked cost databases and BIM platforms that maintain all design, cost, schedule, and sustainability aspects of a project in a cloud-based platform. Digital workflows allow BoQ items and work sections to be populated automatically and reliably, and shared with contractors and other stakeholders in real time.

Construction estimating

The digital shift in BoQ creation has also simplified and improved estimation and bid tendering processes. With the BoQ produced and updated almost effortlessly, applying accurate cost information to support an estimate or bid is now more efficient and reliable than ever before. A digital BoQ connects specifications, work elements, rates, and quantities in a structured and collaborative format.

BIM-enabled processes

The rising popularity of building information modeling platforms complements the role of the BoQ in modern construction. The Bill of Quantities translates information from the BIM model into measurable work and material information. With detailed design, process, and quantity data captured in the integrated BIM platform, the impact of any real or prospective changes on the BoQ can be reviewed instantly.

Cost transparency

The Bill of Quantities has always been a useful document for conveying information on key cost drivers to project owners, contractors, and other key stakeholders, but manual updates and paper documents once made this information inaccessible. Digital BoQs take cost transparency to the next level by making cost, work item, and quantity information easy to sort, analyze, and share in real time.

Bill of Quantity FAQs

The Bill of Quantities concept is nearly as old as the quantity surveying profession itself, and estimators, project owners, and contractors have continued to refine the process for over a century. Despite the familiarity, new software and technology introduce some important questions on BoQ definitions and applications.

What is a BoQ vs BoM?

Sometimes, people confuse a construction Bill of Quantities with a Bill of Materials (BoM). While both documents are similar, they differ in their application and focus. A BoM only outlines the materials needed to complete a project. A BoQ, on the other hand, outlines and describes all work required for the project.

Who uses a BoQ?

Quantity surveyors, estimators, contractors, and project owners are the primary BoQ users, so they must understand how to create and interpret these documents, and how they impact their specific roles. Additional project stakeholders like architects, specialists, and suppliers should also familiarize themselves with the latest BoQ formats and technologies to improve collaboration and ensure everyone is on the same page.

What is the difference between a BoQ and a Schedule of Rates?

A Schedule of Rates (SoR) is similar to a Bill of Quantities in some ways, since it details unit prices and hourly rates for various construction tasks. However, unlike a BoQ, the SoR does not tell you how much of each work item is required to complete a specific project. Teams may choose to combine the more generic SoR information with the project-specific BoQ to produce a baseline cost estimate. 

Why is a BoQ important for tendering?

The BoQ is extremely valuable during the bid tendering process, since the standardized format and detailed list of materials and tasks remove ambiguity to ensure all contractors are bidding on the same work. This makes it easier to compare bids side-by-side and detect key differences. A comprehensive Bill of Quantities also prevents errors and omissions by breaking the entire project into measurable work items with well-defined expectations.

Final Thoughts

As you learned throughout this post, BoQs are powerful tools that make construction projects more organized and cost-efficient for project owners and contractors. To submit bids efficiently and accurately, it’s essential to ensure the Bill of Quantities pricing and tender evaluation processes are correct. A detailed and accurate BoQ will eliminate unwanted rework, wasted time, and unnecessary expenses. This means more successful bids and more satisfied customers.

Arming yourself with the right software solutions is critical. RIB Candy provides flexible and transparent estimating, planning, and project control in a single management solution. Book a demo today to experience powerful construction estimating software!

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