Comment Re:cost plus contract (Score 2) 68
This is not correct. Cost Plus means the contractor is paid for actual work done plus either a fixed fee or an award feed... thus CPFF or CPAF contract types.
Cost plus contracts are NOT the only ones bid legitimately... its normally the opposite. if you know you are you are going to get paid for your actual hours worked, you bid as low as you can justify and then incur over runs later for "risks"', etc.
Point (1): no cost plus never "kicks in" like this. Even in other contract types if anything is changed you can renegotiate the cost.
Point (2): WTF does this even mean....
Point (3): Wrong again. nothing "activates". The contractor is paided for actual hours worked.. thus the "cost" part of cost plus. The "plus" part is the fee paid... basically profit.
Example: You now lawns. You quote someone $50 to mow their lawn. This would be Fixed Price. You take however long you want to now the lawn, and you get $50.
You quote someone $25 per hour for your labor and estimate it will take 2 hours to mow the lawn. This would be cost plus. You might add something like.. if I do a good job I also get $10 bonus at the end.. this would be cost plus fixed fee.
Cost plus contracts are NOT the only ones bid legitimately... its normally the opposite. if you know you are you are going to get paid for your actual hours worked, you bid as low as you can justify and then incur over runs later for "risks"', etc.
Point (1): no cost plus never "kicks in" like this. Even in other contract types if anything is changed you can renegotiate the cost.
Point (2): WTF does this even mean....
Point (3): Wrong again. nothing "activates". The contractor is paided for actual hours worked.. thus the "cost" part of cost plus. The "plus" part is the fee paid... basically profit.
Example: You now lawns. You quote someone $50 to mow their lawn. This would be Fixed Price. You take however long you want to now the lawn, and you get $50.
You quote someone $25 per hour for your labor and estimate it will take 2 hours to mow the lawn. This would be cost plus. You might add something like.. if I do a good job I also get $10 bonus at the end.. this would be cost plus fixed fee.