A bill of quantities, commonly shortened to BOQ or simply “the bill”, is a document used in construction tendering that itemizes the materials, parts, and labour needed for a project together with the quantity of each. The items are taken from a standard method of measurement, and the total quantity for each one is abstracted from the tender drawings, usually by the design organization. The bill acts like a shopping list that the tenderer completes by inserting the prices that will be charged against each item.
Until activity schedules appeared in the previous two decades, bills of quantities were probably the most used pricing and payment mechanism in construction contracts. They are still used extensively in building contracts, while civil engineering contracts tend to favor target price contracts of one form or another. This article explains what a BOQ contains, who prepares it, how it works as a pricing and payment mechanism, and how it differs from a bill of materials.
What Is a Bill of Quantities?
A bill of quantities is a list of items taken from a standard method of measurement, the published set of rules that defines how each element of work is measured and described. Against each item, the total quantity is abstracted from the tender drawings and set out in a table with the item description, the unit of measurement, and the quantity. Most items are measured as either rates or prices per unit. A project might carry rates against meters of pipes, square meters of formwork, and cubic meters of concrete, while valves and pipe fittings are measured as prices per unit against “number” (nr).
The standard method matters because it fixes the boundary between items. Without it, one estimator might include the excavation for a foundation inside the concrete item while another bills it separately, and the resulting tenders could not be compared line by line. With it, the same operations appear in the same place in every bill, so the client can check a single rate against the market price for that operation.
The four parts of a BOQ line
Every line in the bill carries the same four pieces of information, which keeps the document uniform across the whole project:
- Item number, which identifies the line and links it to the specification and the drawings
- Description of the work or material, written to match the rules of the standard method of measurement
- Unit of measurement, such as m, m2, m3, nr, tonne, or lump sum
- Quantity, taken off the tender drawings before the document is issued
Where the BOQ sits in the contract
In traditional contracts such as ICE7 and JCT SBCO5, the bill of quantities is a pricing mechanism and a payment mechanism. It is used in NEC3 ECC option B in a similar way, while option D also uses bills of quantities but only as a pricing mechanism. In JCT contracts the bill is usually called the contract bill and is combined with the specification items relevant to each item in the BOQ. The normal assumption of contracts using a bill of quantities is that the design organization or a quantity surveyor prepares it and issues it in the same format to all companies that are tendering.
How a Bill of Quantities Is Prepared
The bill is prepared by the design organization or by a quantity surveyor and issued in the same format to every company that is tendering. Because the quantities are measured once for all bidders, there is no abortive work effort by unsuccessful tenderers. Teams that want the routine laid out item by item can follow this step-by-step guide to preparing a BOQ, and the sequence below summarizes the main stages.
The preparation sequence
- Assemble the tender drawings, the specification, and the standard method of measurement chosen for the contract
- Divide the works into sections that match the contract structure, such as substructure, superstructure, and finishes
- Take off the quantities from the drawings and record them against the correct items
- Apply the measurement rules, checking units, deductions, and descriptions against the drawings
- Add preliminary items for site setup, plant, and general obligations
- Review the completed bill and issue it to all tenderers in the same format
Taking off quantities
“Taking off” is the term used for abstracting quantities and inserting them against the relevant item in the bill of quantities. Quantity surveyors are usually employed in the building industry to take off quantities, whereas those civil engineers who still have the skill base generally take off their own quantities. The profession that concentrates on the billing and measurement function is the quantity surveyor, or “QS”.
Units used in a bill of quantities
The unit attached to each item decides how the rate is built. Linear work such as pipe runs and edge beams is measured in meters (m), flat surfaces such as formwork and plastering in square meters (m2), and mass concrete in cubic meters (m3). Items supplied as complete units, such as valves, manholes, and fittings, are counted in numbers (nr), while loose materials like aggregates and steel reinforcement are often measured by tonne (t). Preliminary items are priced as lump sums or dayworks.
The BOQ as a Pricing and Payment Mechanism
Pricing the bill at tender stage
The total of all the items in a priced bill is the tender price, and this is the use of the BOQ as a pricing mechanism. The contractor’s tendering department normally includes people called estimators who price up the bill by inserting an appropriate rate or price against each of the items. Because every bidder prices the same quantities, the comparison between tenders comes down to the rates and the assumptions behind them.
A rate has to absorb not only the direct cost of labour, material, and plant but also allowances for waste, supervision, overheads, and profit. As a simple example, a rate for in-situ concrete of 300 per cubic meter might be built from 190 for material and delivery, 60 for placing and compacting, 25 for formwork stripping and cleaning, and 25 for overhead and profit. Two contractors can reach the same total through completely different splits, and the client compares the totals while the estimator watches the items where the split looks optimistic.
Payment against measured quantities
During the course of construction, regular payments are made by measuring the actual quantities used on-site and multiplying them by the rate in the BOQ, which is their use as a payment mechanism. Where the measured quantity differs from the billed quantity, the difference is valued at the contract rate and adjusted in the next interim certificate. The bill of quantities can also be used by the design organization to estimate quite accurately the likely cost of the completed works, because the priced rates can be applied to the final measured quantities.
BoQ vs BoM: What Is the Difference?
The full form of BoQ is bill of quantities, and the abbreviation is also the everyday name of the document. A bill of materials, or BoM, is a different document even though the two names look alike. A BoM lists every material, part, and component needed to produce a product or an assembly, with quantities, part numbers, and often unit costs, and it is used mainly in manufacturing and prefabrication rather than in site tendering.
Side-by-side comparison
| Aspect | Bill of Quantities (BOQ) | Bill of Materials (BoM) |
|---|---|---|
| Primary purpose | Pricing and payment in construction contracts | Material and component planning for production |
| Where it is used | Construction tendering and site measurement | Manufacturing, fabrication, and prefabrication |
| Prepared by | Design organization or quantity surveyor | Designer, manufacturer, or procurement team |
| Main contents | Itemized works with quantities, units, and rates | Parts list with part numbers, quantities, and sources |
| Contract role | Becomes part of the contract and drives interim payments | Supports procurement and assembly, rarely a payment basis |
When each document is used
A construction project often uses both documents at different levels. The contractor’s workshop produces shop drawings and a BoM to order steel, precast units, and fittings, while the site contract runs on the BOQ that was priced at tender. The BoM answers the question of what materials are needed to make an element, and the BOQ answers the question of what work is being paid for and how much.
Advantages and Limits of Bills of Quantities
The main advantages
- Consistency across every tender, because all bidders price the same quantities
- A straightforward process for checking and comparing tenders
- A bill prepared only once rather than by each tenderer
- No abortive work effort by unsuccessful tenderers
- A reliable basis for interim payments by re-measurement
- A solid benchmark for cost forecasting by the design team
Where the BOQ has limits
The bill works best when the design is settled before tendering. If the scope changes during construction, the re-measurement and valuation of variations add administrative cost, and disputes can develop over the classification of changed items. Activity schedules and target price contracts, which have grown in civil engineering, shift the emphasis from re-measured quantities to outcomes and shared risk, which is one reason bills of quantities remain more common in building contracts than in civil works. The choice between the two depends on how well the scope is defined at tender and how the client wants risk to be shared.