Category: Quantities & pricing
Prepared by Eng. Ahmed Fathy, Projects Manager ·
Definition
A lump-sum contract has one fixed total price for a scope defined by drawings and specifications, with no remeasurement of quantities.
Why it matters on a project
It gives the owner cost certainty and moves quantity risk to the contractor. It works only when the drawings are complete at tender.
Common mistake
Tendering a lump-sum contract on incomplete drawings, so every gap becomes a variation and the certainty is lost.
Frequently asked questions
Can a lump-sum price change?
Yes, through variations when scope changes; quantity errors usually stay with the contractor.
When does a lump-sum contract suit?
When drawings and specifications are complete and the scope is clear before tender.
Related terms
- Re-measured contractA contract paid on actually executed quantities multiplied by unit rates.
- Variation order (VO)A written instruction changing scope, quantity or specification, with its price and time effect.
- TurnkeyDelivering the complete project ready for use with one party responsible for design and construction.
- Construction drawingsDetailed drawings used to build the work on site after design approval, including dimensions, levels and details.
Read next
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