Wednesday, December 16, 2009

Disadvantages of Fixed Price Contract

Disadvantages of Fixed Price Contract include:
  • Seller may under-price the work and try to make up profits on change orders
  • Seller may not complete some of the contract statement of work if they begin losing money
  • More work for buyer to write the contract statement of work
  • Can be more expensive than Cost Reimbursable Contract if the contract statement of work is incomplete
  • Seller will need to add to the price for their increase of risk

No comments:

Recommended Books on PMP

Suggested Study Materials

  • PMP-Preparation Recommended Books
  • PMP Exam Prep, Fifth Edition: Rita's Course in a Book for Passing the PMP Exam
  • A Guide to the Project Management Body of Knowledge, Third Edition (PMBOK Guides)
  • The PMP Exam: How to Pass On Your First Try (Test Prep series)