- 1 How does a GMP contract work?
- 2 What is a GMP set of drawings?
- 3 What is the difference between GMP and lump sum?
- 4 What is a GMP job?
- 5 What are the 3 types of contracts?
- 6 What is a GMP amendment?
- 7 What is GFC drawing?
- 8 What is a PR in construction?
- 9 What is PO in construction?
- 10 What is a CM at Risk?
- 11 What is the difference between fixed price and lump sum contract?
- 12 What are the three most commonly used types of construction contracts?
- 13 What is GMP in project management?
- 14 What is a stipulated sum?
- 15 What is unit rate contract?
How does a GMP contract work?
A guaranteed maximum price contract sets a limit, or maximum price, that the customer will have to pay their contractor or subcontractor, regardless of the actual costs incurred. GMP contracts are attractive to customers because they shift a significant amount of risk to the party performing work.
What is a GMP set of drawings?
Guaranteed Maximum Price (GMP)
The agreed upon maximum price between the Contractor and Owner to build a project per the drawings and specifications developed.
What is the difference between GMP and lump sum?
A Lump Sum contract price will always be lower than the Guaranteed Maximum Price in a GMP/Cost-Plus contract because the GMP/cost-Plus contract will include a construction contingency (typically 5% plus or minus that is not included in a Lump Sum contract amount.
What is a GMP job?
A guaranteed maximum price (also known as GMP, not-to-exceed price, NTE, or NTX) contract is a cost-type contract (also known as an open-book contract) where the contractor is compensated for actual costs incurred plus a fixed fee subject to a ceiling price.
What are the 3 types of contracts?
So let’s look at those three contract types in a bit more detail.
- Fixed price contracts. With a fixed price contract the buyer (that’s you) doesn’t take on much risk.
- Cost-reimbursable contracts. With a cost-reimbursable contract you pay the vendor for the actual cost of the work.
- Time and materials contracts.
What is a GMP amendment?
GMP Amendment means the amendment to the Construction Contract establishing the terms and conditions on which the Prime Contractor has agreed to construct the Project for a price not to exceed the GMP with Substantial Completion not later than the Substantial Completion Date.
What is GFC drawing?
GFC which means good for the construction is all about construction drawings and specification related to it for elected project. (1)Elevation-Elevation as in construction drawings includes the height of fixtures and furniture. Even it gives technical details of other build-in as well.
What is a PR in construction?
ASI – Architectural Supplementary Instruction. PR – Proposal Request. CPR – Change Proposal Request.
What is PO in construction?
What is a Construction Purchase Order? A purchase order is a document that confirms an order for construction materials, sent from a buyer to a material supplier or equipment renter.
What is a CM at Risk?
CM at-risk (CMAR) is a delivery method which entails a commitment by the construction manager to deliver the project within a Guaranteed Maximum Price (GMP), in most cases. CM at-risk is a cost effective and time conscious alternative to the traditional design-bid-build process.
What is the difference between fixed price and lump sum contract?
Under a lump sum contract, a single ‘lump sum‘ price for all the works is agreed before the works begin. It is defined as a fixed price contract, where the contractors agree to execute the work for a stated total sum of money.
What are the three most commonly used types of construction contracts?
Three Common Construction Contracts
- FIXED PRICE. Fixed price construction contracts, also commonly referred to as “lump sum” or “stipulated sum” contracts, are the most common types of construction contracts.
- COST PLUS.
- GUARANTEED MAXIMUM PRICE.
What is GMP in project management?
A GMP, or a Guaranteed Maximum Price, is one of the most common pricing structures used by construction contractors. Under a GMP contract, the contractor is compensated for actual costs incurred, plus a fixed fee which covers risk.
What is a stipulated sum?
A lump sum contract, sometimes called stipulated sum, is the most basic form of agreement between a contractor and a customer. A lump sum contract or a stipulated sum contract will require that the contractor agree to provide specified services for a stipulated or fixed price.
What is unit rate contract?
Under a unit price contract, a contractor is paid for the actual quantity of each line item performed as measured in the field during construction. Each unit price includes all labor, material, equipment, overhead, and profit attributable to that scope of work.