Demobilization is the back end of mobilization: pulling crews, tools, equipment, jobsite trailers, fencing, signage, dumpsters, and temporary utilities off the project site. It happens at substantial completion (or at the end of a phase on multi-phase work). Demob costs are real and often underestimated: trailer pickup, equipment haul-back, final site cleanup, restoration of landscaping disturbed by site office or laydown areas, and the labor hours of supervisors who manage the wind-down.
Well-run estimating includes a specific demob line item, often 0.5 to 2% of contract value depending on how heavy the site setup was. Skipping demob in the bid is a classic small-contractor mistake that eats into profit on every job. On phased work, demob between phases is a separate cost to price; some contractors negotiate a single mobilization-and-demob payment per phase to recover it cleanly.