Browse Forums General Discussion 1 Mar 13, 2021 2:36 pm Hi Everyone. We would like some help in explaining cost plus contract. We are half way into a renovation with this type on contract. Our builder doesn’t actually employ anyone as a carpenter, all his carpenters are subbies. I would have thought that we should receive invoices from these subbies and than pay 20 percent on top of that (agreed plus amount). What he does is sends us time sheets for the guys and charges us $85 hour as stated in the contract under Builder/supervisor/tradesman. We did receive one invoice from one of the subbies (I think accidentally) which invoice is for $1000 than builder has charged $1400 at the rate of $85 per hour. The way we are reading contract, builder means party that is listed at the front of contract which is builder we engaged to do work. There is trades listed also in contract but is employees of builder. Our question is does these carpenters that are not employed by our builder come under builder/trades hourly rate listed in contract? Should we be getting invoices from these sub contractors and then pay plus amount on top of that? Re: Cost plus contract 2Mar 14, 2021 7:41 am pickerbr Hi Everyone. We would like some help in explaining cost plus contract. We are half way into a renovation with this type on contract. Our builder doesn’t actually employ anyone as a carpenter, all his carpenters are subbies. I would have thought that we should receive invoices from these subbies and than pay 20 percent on top of that (agreed plus amount). What he does is sends us time sheets for the guys and charges us $85 hour as stated in the contract under Builder/supervisor/tradesman. We did receive one invoice from one of the subbies (I think accidentally) which invoice is for $1000 than builder has charged $1400 at the rate of $85 per hour. The way we are reading contract, builder means party that is listed at the front of contract which is builder we engaged to do work. There is trades listed also in contract but is employees of builder. Our question is does these carpenters that are not employed by our builder come under builder/trades hourly rate listed in contract? Should we be getting invoices from these sub contractors and then pay plus amount on top of that? Without seeing your contract its hard to give you accurate advice, I can only state what is best practice and should have been agreed to, but maybe it hasn't been. The best practice of cost plus in the commercial world ( as you don't see it too often in the residential world - well i haven't so others might use it all the time) is what we call "Open Book". With an Open Book arrangement the contractor will submit minimum 3 quotes for each trade/category and then make a recommendation which needs to be agreed upon. Invoices will then be submitted with a covering invoice from the builder with his margin. There can be hourly rates for labourers and carpenters when on staff ( although day rates are more common). The hourly rate you are being charged for carpentry is fair, you just hope that they are actually working the hours they state they are and that they are being efficient during those hours. Simeon McGovern Affordable Custom Homes, We design and build to your budget Ashington Homes www.ashingtonhomes.com.au Re: Cost plus contract 3Mar 14, 2021 9:16 am Hey pickerbr welcome to the forum when you sign a fix priced contract it's always advisable to have an idea of the material quantities involved, how long it will take to complete the work onsite and the plant/machinery involved. In the old days large projects employed an independent Clerk Of Works Construction basically an over seer with a trade background these days they are project managers on contract working for the builder. As stated how do you know what's a fair amount to pay if you don't know, what's involved, how long it should take to do the work, what materials involved? other issue arise ie. a. Turn up for a few hours and have a 2hr urber eats lunch break for various reasons b. Turn up and then nick off to another job for half the day c. Loiter on the job d. take shortcuts and say this is how's it's now done e. Front load projects with labour cost f. Only half complete the job and you have paid 80% of the trade quote LOL, your $85/hr turns out to be $150/hr with no end on/in ̶s̶i̶t̶e̶ sight (humour) OT, That's why 3D Bim has become popular with clients in that they have access to the build information and data via apps. On the other hand we have architects and graphic artists modelling 3D Builds in computers that have no idea how it's going to be engineered and built on a real site... a double edge sword that will cut your budget to shreds if not implemented correctly by the client. ALWAYS ask for Engineering Bim upfront Cheers Chris Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Cost plus contract 4Mar 15, 2021 6:31 am StructuralBIMGuy Hey pickerbr welcome to the forum when you sign a fix priced contract it's always advisable to have an idea of the material quantities involved, how long it will take to complete the work onsite and the plant/machinery involved. In the old days large projects employed an independent Clerk Of Works Construction basically an over seer with a trade background these days they are project managers on contract working for the builder. As stated how do you know what's a fair amount to pay if you don't know, what's involved, how long it should take to do the work, what materials involved? other issue arise ie. a. Turn up for a few hours and have a 2hr urber eats lunch break for various reasons b. Turn up and then nick off to another job for half the day c. Loiter on the job d. take shortcuts and say this is how's it's now done e. Front load projects with labour cost f. Only half complete the job and you have paid 80% of the trade quote LOL, your $85/hr turns out to be $150/hr with no end on/in ̶s̶i̶t̶e̶ sight (humour) OT, That's why 3D Bim has become popular with clients in that they have access to the build information and data via apps. On the other hand we have architects and graphic artists modelling 3D Builds in computers that have no idea how it's going to be engineered and built on a real site... a double edge sword that will cut your budget to shreds if not implemented correctly by the client. ALWAYS ask for Engineering Bim upfront Cheers Chris Chris So true, but said only in a way you can with your sense of humour I was attempting to be a little diplomatic, but I think you cut through a bit better. You're right, the $85/hour can easily end up as a $150/hour effective rate. Cheers S Simeon McGovern Affordable Custom Homes, We design and build to your budget Ashington Homes www.ashingtonhomes.com.au Re: Cost plus contract 5Mar 20, 2021 9:15 pm We have just completed a cost plus build. We had similar where we received three quotes and we could choose which quote (for most things) We did however have an hourly rate for the builder/carpenter/apprentices, we found that the boys enjoyed a few too many long lunches, so we asked for a weekly detailed report of what was done each day, we found we were being charged for things that the carpenters were doing (also $85/hr) which they shouldn’t be, like cleaning up render off concrete, installing a pole for our gas bottles, assisting with installing cabinetry (which was part of the cabinetry quote) etc etc. It really started p!ssing us off, things soured a little, so we started asking for more specific time frames (such as how many hours to install the skirtings, etc) so they knew we were keeping track. My only recommendation would be to also get the carpentry work quoted and accepted, as our carpentry bill was over double the estimate. Re: Cost plus contract 6Mar 22, 2021 11:34 am gogo65 We have just completed a cost plus build. We had similar where we received three quotes and we could choose which quote (for most things) We did however have an hourly rate for the builder/carpenter/apprentices, we found that the boys enjoyed a few too many long lunches, so we asked for a weekly detailed report of what was done each day, we found we were being charged for things that the carpenters were doing (also $85/hr) which they shouldn’t be, like cleaning up render off concrete, installing a pole for our gas bottles, assisting with installing cabinetry (which was part of the cabinetry quote) etc etc. It really started p!ssing us off, things soured a little, so we started asking for more specific time frames (such as how many hours to install the skirtings, etc) so they knew we were keeping track. My only recommendation would be to also get the carpentry work quoted and accepted, as our carpentry bill was over double the estimate. Thats really good advice We use a labourer for all those cleaning and miscellaneous items for around $20/hour. Definitely get the carpentry quoted and fixed Simeon McGovern Affordable Custom Homes, We design and build to your budget Ashington Homes www.ashingtonhomes.com.au 1000000% definitely add insulation. I have in my home and it makes a big difference minimising sound transfer. Insulation is pretty cheap and definitely worth it 2 6191 We are building a house that was planned to be clad in Hardie Linea, our builder has now requested to swap this for BGC Nuline Plus. They look fairly similar and he has… 0 604 You talk about deletions, are they variations or PS and PC adjustments? pleas list them 1 16548 |