Which type of estimate is often used in the early phases of project development?

The preliminary estimate is crucial in the early phases of project development because it provides an initial assessment of the potential costs involved. This type of estimate is generally based on limited information and is meant to give stakeholders a rough idea of the financial requirements before detailed designs and specifications are available.

Preliminary estimates typically utilize historical data, standardized cost information, or a conceptual understanding of project parameters. The goal during this phase is to help decision-makers gauge feasibility, secure funding, and guide the direction of project planning. Since these estimates are not based on precise data, they inherently have less accuracy than detailed or final estimates, which are developed later when more comprehensive project information is available.

In contrast, a detailed estimate involves a thorough breakdown of costs based on finalized design documents and specifications, while bid estimates are prepared to submit a proposal for contractors to win a job. Final estimates are usually conducted after the project scope is well-defined and all details are accounted for, resulting in a more accurate financial projection.