Edel Keating

Question 1

Three Types of pricing under traditional procurement

Answer 1

1. Lump sum contracts - where the contract sum is determined before construction starts, and the amount is entered in the final contractual agreement.
2. Measurement contracts – where the contract sum is accurately known on completion and after re-measurement in accordance with a predetermined method.
3. Cost reimbursement – where the contract sum is arrived at on the basis of the actual costs of labour, plant and materials, to which is added a fee to cover overheads and profit.