Cost Plus Contract For Construction
Description
How to fill out Colorado Construction Contract Cost Plus Or Fixed Fee?
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FAQ
The two main variations of this approach to bidding are cost-plus-a-percentage and cost-plus-a-fixed-fee. Cost-plus-a-percentage. In this scenario, the contractor bills the client for his direct costs for labor, materials, and subs, plus a percentage to cover his overhead and profit.
plus contract is one in which the contractor is paid for all of a project's expenses plus an additional fee for the job. The additional fee is intended to be the contractor's profit.
Although there is no industry standard, the "plus" part of cost-plus contracts is usually in the range of 10 to 20 percent of the project's total cost.
coordinated CostPlus contract can save the Owner a lot of money. For instance, on a Fixed Price contract, if the Contractor is able to save money by finding a better material price, or using laborsaving strategies, those savings revert to the Contractor.
Cost plus percentage of cost is a method contractors often use to price services. This type of contract specifies that the buyer must pay all the project costs incurred by the seller, plus an additional amount for profit.
