The construction field is one field that is active throughout the year. Every city or town can see many projects coming up every other month. The demand for more houses and company offices is on the rise due to the raising of many people establishing new business and more people moving from rural setting to urban setting. This can be backed by the high number of construction companies coming up every month. This is to cater for the high demand for construction of buildings, either skyscrapers or just buildings which can hold few offices. Read more about project management in this article.
As the project owner, you may find it hard to come up with the way you will engage the contractors in terms of payment. The contractors, on the other hand, may not be sure whether to go for fixed cost or time and material contract way of cost. Fixed costing is when the contractor is paid for the services according to the initial agreement by both parties. The contractor comes up with all the required calculation calculating the amount of money needed from the start of the project to the last day of the project. The contractor will have to bear in other additional costs that may arise before the project is finished, therefore the contractor should come up with the appropriate budget that will see no additional cost.
Time and material costing is where costing is determined by the time the contractor will take or for how long the project will last. The constructor will be paid either daily by weekly or monthly until the last day of the project. The costing also looks at the material used, some materials used can make the cost of the project to go high. When using glass and other fragile material in any project the cost of the project goes up as compared to other materials like stones and wood materials. This kind of costing also determine who will be paying for the material used until the project is done. Whether the project owner will be bringing in materials or the contractor.
Fixed costing is better used where the project will not take time to finish maybe going for less than 3 months. It is also good to use the fixed cost when there is a fixed deadline, meaning the contractor and the project manager will agree on the deadline before the start of the project. On the other hand time and materials costing is best used when the project is projected to take years before the project is finished. It is also best used when there are many dynamics and many expected changes to happen before the project is finished. To learn more about project management, click on this link: https://www.huffpost.com/entry/is-project-management-right-for-you_b_598330aee4b03d0624b0ac88.