Construction is an index of the progress of any nation and contract in construction industry is an essential part of it. Contract is basically an agreement between two parties,certain terms and conditions are laid down in it under which work is performed.The transaction phase of the project is also associated with contracting. It is very important for the organizations to evaluate their capabilities so that they could play their part in the right earnest before signing a contract.Some additional terms and conditions are also mentioned that form an integral part of a contract.
A clear and simple agreement is signed between the client and the service provider.
Aspects of Contracting-
- Vision holds a very important role as the whole process of the deal depends on it.
- A great amount of diversity in the workers increases the chances of productivity and affects the overall profit.
- It is very important for the parties to be legally capable of playing their role in the right earnest.
The contracting terms should clearly define the subject matter.
Focus Areas in Contracting-
- Contracting is mainly the management of rights and obligations of the parties to a contract and it is essential to have all the terms regarding the contract for a good management.
- Creating a checklist before beginning of a contract is very important to stay away from the risk of delaying the schedule of the project.
- One of the most common failure that arises in contracting is not confirming all the instructions in writing which leads to various verbal stories which is based on verbal instructions.
- It is very important to understand the fundamentals of achieving the practical completion at the outset of the project.
A2G constructions emphasizes on doing things the right way.We nurture trusted partnership with our clients by assesting them in the early phase of the project by providing different contracting services to them. Dedication and commitment is seen in our work which prompts clients to trust us. We believe in establishing a strong connection with the people
Contract Types
Construction contracts are standard form of documents that are related to different services. A clear and simple agreement is signed between the client and the service provider. Commercial building projects are very much benefited by it. There are so many types of contracts that exist in the construction business but A2G construction recommends some of them which is totally based on our working experience which further proves to be very beneficial for emerging businesses who have the capacity to adapt new things constantly but have limited resources. Below mentioned types of contracts that ensure the best quality performance by controlling the process in a systematic way hence reducing the associated risk.
Cost Plus
In a Cost plus contract the construction organization is paid by the client for the manufacturing related expenses which includes material,labour etc that are mentioned along with the calculated profit amount. The paid or the spent amount lies within a specific criteria to protect against cost overruns.It is prefered when the work is uncertain.It completely nullifies the risk of loss that arises from price change.
Lump Sum
It is considered to be the traditional and most common type of construction contract.Its main work is to reduce the price of construction when activities related with the project are well defined.A total amount is paid by the contractor instead of bidding on individual items which is a time consuming process.It is very much preferred for those projects that are well defined and systematic with low risk associated.
Guaranteed Maximum Price
In a GMP an agreement is signed with the contractor in which it is clearly mentioned and agree upon that the overall price of the contract would not exceed more than the laid out figures. It tends the contractor to carry out the construction work in a smart way to ensure some control on the cost without compromising the safety of the project.
