Pricing - COMPLETE

Question 1

Stipulated Sum

Answer 1

aka - lump sum, fixed sum bid
- one single number value that represents all costs required to build project
- competitively bid projects typically rely on this approach (DBB, DB, Publicly funded)

Question 2

Items that go into project cost:

Answer 2

cost of construction/work
construction contingencies
contractor overhead costs, profit, bonds

Question 3

GMP

Answer 3

• cost of construction the contractor assures the client the project will be built for
• developed by GC prior to completion of construction docs
• usually includes line item prices and allowances, contingencies
• typical for projects with acccelerated schedules

Question 4

Cost Plus

Answer 4

AKA time and material (t&m)
based on actual cost of work
subcontractors + contractor submit detailed accounting of cost of materials, equipment, etc.
labor to construct project is reimbursed at predetermined hourly rates for actual hours expended
contractors receive overhead and profit payments at fixed rate
typical for: small projects, existing conditions are unknown, scope is hard to define, change orders within a stipulated sum or GMP

Question 5

Unit Prices

Answer 5

typical for: when full project scope is unknown
costs for each specific unit of work (materials, labor, fees, profit)
contractor is compensated for number of units of each system constructed based on unit prices

Question 6

Target Price

Answer 6

typical for DB
owner sets construction cost as part of procurement documents, db team provides most scope for the cost