I advocate for main contractors to produce a measured pricing document (BoQ) for subcontractors to price during the tender process, a topic our clients regularly raise.
“Do you think I need to include a measure for this package?”
For me, it is a must on almost every package. I believe you should prepare a pricing document to detail the quantity of the works you want to be provided.
Many principal contractors don’t produce a BoQ to avoid the cost (in time or money) of doing so, and some even fear that issuing a BoQ means taking on too much responsibility. Although it may save time if you do not produce a BoQ, this will lead to subcontractors producing their take-offs or price build-ups, and you will have no common basis to compare tenders.
Depending on how the price for the works is then incorporated into the contract, there is the risk that scope gaps, specification changes, and quality deviations will be incorporated into the subcontract agreement. This may lead to unbudgeted cost increases and disputes about what has been included. It is far less risky to include your own Pricing Document / BoQ.
Having a BoQ in place also brings immeasurable benefits as each subcontractor will be able to respond more quickly and price on your terms and, therefore, on a like-for-like basis.
Having a BoQ in place also serves as a management tool for the project. Contracts should always contain contract rates for the work. A BoQ provides a basis to value any likely changes and assists in valuing the works in the monthly applications for payment.
Consider the risk allocation of ‘with or without quantities’ contracts carefully. The BoQ takes precedence over the drawings and specifications if the contract is with quantities. Any missing items from the BoQ are a change and, therefore, a client risk.
Conversely, where the contract is drawings and specification, if items are missing from the pricing document, as long as these items are covered within the drawings and specification, these would be included within the contract lump sum and therefore are at the risk of the subcontractor.
Regardless of the risks, the benefits are tangible and will make the tender process simple and effective. It will speed things up, allowing you and the subcontractors to focus on intelligent value engineering solutions instead of measuring a project for which you already have the quantities.
Despite my wholehearted beliefs on the matter, the common questions I am asked did get me thinking about everyone else and their perspective. I ram some research to understand what other professionals believed to be the best approach.
I was pretty pleased with the results, with nearly 70% of Quantity Surveyors agreeing that it is better to produce and issue a BoQ when issuing a tender out. Those in the 30% who did not were slightly more nuanced than simply saying no. The nuance for them was that on a package with CPD, i.e. waterproofing or M & E, it is preferable to leave the pricing document to the specialists who are responsible for the design.
In short, on packages where the design is complete, the overwhelming response is that it is better to produce a measured bill for subcontractors to price.
Moreover, a separate bit of research found that 70% of subcontractors want their clients to issue a BoQ to them as well.
It appears that best industry practice suggests that a measured pricing document is a thing to do: Most of your competitors are doing it, and subcontractors prefer it when you send in this format, meaning you are likely to receive more tender returns from the marketplace.
What is there not to love?
About Paul Heming
Paul was a Quantity Surveyor who gained 10 years experience of managing £200 million worth of flagship UK projects, including 20 Fenchurch Street and Battersea Power Station. In 2015, Paul founded C-Link with the intention of sharing his expertise of managing major projects with the SME market.