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Construction glossary
Construction Glossary •

Cost Plus Billing

What is Cost Plus Billing?

Cost Plus Billing in the construction industry refers to a method where the customer agrees to cover the actual costs, expenses and other direct costs of the construction project plus an additional sum for contractor’s overhead and profit. These typically include costs of materials, labor, and subcontractor charges. The agreement clearly establishes and defines what is constituted as cost, the overhead percentage, and the profit percentage, reducing the risk of any surprise costs. Essentially, the 'Cost' represents the direct costs of the construction, while the 'Plus' is the contractor's fee and is usually agreed upon as a fixed percentage of the total costs or as a target price with a shared savings clause.

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Other construction terms

Cloud-Based Software

What is Cloud-Based Software?

Cloud-Based Software, in the context of the construction industry, refers to software applications that are hosted on remote servers and accessible via the internet. Instead of being installed directl...
Software as a Service (SaaS)

What is Software as a Service (SaaS)?

Software as a Service (SaaS) in the context of the construction industry is a key model of cloud computing. It allows construction firms to access software over the internet on a subscription basis. E...
Project Manager

What is a Project Manager?

A Project Manager in the construction industry is a professional responsible for overseeing and directing the progression of projects from conception to completion. This role entails coordinating a te...

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