Cost-Plus Fee

Cost-Plus Fee is a type of contract where a contractor is paid for all their project costs plus an additional fee for their profit. The costs include expenses like materials, labor, and overhead. The fee can be a fixed amount or a percentage of the costs. This arrangement provides flexibility and assurance for the contractor, but it may lead to higher expenses for the client since costs can fluctuate. It's commonly used in construction or large projects where estimating total costs in advance can be challenging.