In the context of construction bids, what does a contingency mark-up provide for?

A contingency mark-up in construction bids is primarily designed to provide a buffer for unforeseen risks and expenses that may arise during the course of a project. This additional percentage added to the estimated costs helps protect contractors from unexpected issues that could lead to increased costs, such as changes in project scope, delays due to weather, or other unplanned events.

Having a contingency fund allows contractors to address these unforeseen circumstances without having to renegotiate the original contract or absorb the costs entirely themselves, ensuring that the project can continue smoothly. This aspect of risk management is crucial for maintaining project timelines and financial stability throughout the construction process.