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What type of contract is ideal when a builder has offered to charge at cost to a client?

CaliforniaConstruction Contract

Hi we have a question a question related to a contract with a client which whom we have offered to build a project a cost in the exchange of the client to let us promote the project in social media. in this case client will pay, cost of material, cost of labor and operational cost. what type of contract you recommend is ideal for this type of negotiation?

3 replies

Jun 21, 2021

This is typically called a cost-plus-fee contract, with the fee being usually a fixed fee amount or a percentage fee based on the total project costs, to cover your overhead and profit

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Jun 21, 2021

If this is for residential remodel work, you still need to use a Home Improvement Contract that contains all of the required notices and information. For a commercial job, you should still have a written contract with adequate provisions to protect your interests. The only thing that will change is the payment provision. I’m happy to answer any questions you have about this.

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Jul 5, 2021

A “cost-plus” or “time and materials” contract.

Usually on these contracts the contractor charges for its actual costs of labor and material, plus a percentage fee or fixed fee amount to cover its profit and overhead.

However, this type of contract may not be legal for a home improvement or home remodeling contract in California, which usually has to have a fixed price and an agreed payment schedule.

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