Construction Financial Glossary

Mobilization Cost Definition

Mobilization cost refers to the expenses incurred at the start of a construction project to prepare the site, transport equipment, and deploy the workforce.

Typical Mobilization Costs

    1. Transporting heavy machinery and tools.
    2. Setting up site offices, fencing, and utilities.
    3. Initial labor and material procurement costs.

Managing Mobilization Costs

To avoid cash flow issues, contractors often negotiate mobilization payments upfront or structure them into progress payments.



Related Terms: Preconstruction Phase, General Conditions, Equipment Rental Costs, Project Startup Costs

FAQs

Can mobilization costs be reimbursed?

A: Yes, they are often included in contracts as an upfront payment to ensure contractors can cover initial expenses.

How can contractors minimize mobilization costs?

A: By optimizing logistics, using local suppliers, and carefully planning site setup.

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