Cost – Plus

Cost-Plus

Guaranteed Maximum Price Contract

Cost-Plus Percentage Contracts are those in which the contractor is paid the actual cost of the contract plus a percentage of markup to cover overhead and profit.  

(Example: $200,000 contract plus 20% markup creates a total contract of $240,000)

Cost-Plus Fixed Profit Contract are those in which the contractor is paid the actual cost of the contract plus a specified fee, that is determined in advance, to cover overhead and profit.

(Example: $200,000 contract plus $40,000 markup creates a total contract of $240,000)

Key Benefits

  • Do not have to have a complete set of construction documents to get started
  • Customer benefits from value-based decisions made during construction