Cost plus fixed fee contracts can suit projects that are difficult to price upfront. Agree a fixed dollar fee, define reimbursable costs, and use open book reporting and spending limits to keep the arrangement fair for both the client and contractor.
An agreed hourly rate does not establish how much a contractor is authorised to spend. Set a clear spending limit, monitor the forecast cost and approve increases in writing to reduce budget surprises and payment disputes.
Good specifications reduce ambiguity, variations, rework and disputes. Make project specifications clear, complete, current, consistent and easy to find before issuing work for tender.
Maintain a project communication, decision and action register so important decisions, client instructions, approvals, commitments and actions don’t get lost in emails and meeting minutes. Use it as a searchable history of the project and an index to the original project records.