What Are Preliminaries?
Preliminaries are the costs of managing the project and running its site that belong to no particular work item: supervision, offices, safety, guarantees and insurance.
What they cover
Site management and supervision staff, the contractor’s and consultant’s offices and their fit-out, temporary power and water, common scaffolding and shared cranes, safety equipment and its team, insurance and bank guarantees, general cleaning and security, and finally demobilisation. They are, in practice, the cost of being on site at all, whatever quantity of work you execute.
Why they are forgotten and cost so much
Because they do not appear on the drawings, so the quantity take-off never catches them. A contractor who prices the work items precisely and then adds an arbitrary percentage for preliminaries may discover a year later that the site budget consumed twice what was allowed. The right way is to price them by build-up: who is on the team, how many months they stay, and at what monthly cost.
Time-related and fixed items
Split preliminaries into two kinds: fixed, spent once, such as site set-up and the guarantees; and time-related, proportional to the duration, such as staff salaries and office rent. That split is the basis of any later extension claim, because an extension costs you the time-related items alone.
Worked example
A 14-month project with a preliminaries budget of SAR 1.85 million, of which 620,000 is fixed and 1.23 million time-related — SAR 88,000 a month. When a two-month extension was granted for variations, the time-related claim rested on a clear figure of SAR 176,000 rather than a negotiated guess.
FAQ
What percentage of the contract value are preliminaries?
Usually between 6% and 15%, higher on long or remote projects and those with demanding safety requirements. The percentage is the result of a calculation, not an input: work it out, then compare it against the range to check it is reasonable.
Are preliminaries paid in the progress claims?
Yes, usually split: part on set-up and part spread monthly over the duration. Negotiate for as early a distribution as you can, because the heaviest preliminaries spend falls in the first months before any revenue.
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