Stipulated Price Contract (Design-Bid-Build or Stipulated Sum)

 

The most common form of project delivery is almost self-explanatory and is well-addressed in CHOP, needing little if any additional commentary. This method of project delivery typically utilizes the CCDC-2 Stipulated Sum Contract between the Owner and Contractor.

 

Key benefits include a known, fair and transparent process with competitive pricing. With quality Construction Documents, a good architect – client – general contractor relationship, and barring extenuating circumstances (such as wildly varying existing conditions), Stipulated Sum can also serve to better manage construction cost, contrary to the commonly-perceived notion that ‘extras’ are more prevalent. Keep in mind however that the price being bid to win the project may be the cost to build the project less the cost of anticipated extras.

The scope of an architect’s/consultant’s services is perhaps the most straightforward here, too.

Usually there are no particularly noteworthy considerations in the preparation of Construction Documents: 

• During Construction Procurement, the key decisions that need to be implemented relate to whether it is an open or closed bid, single or two-stage process. 
• Construction Administration is likewise straightforward in that it likely results in a single contract to administer. 

Fundamental when considering this method of project delivery is that the quality and completeness of the CDs may have the greatest impact on the success of a project. ‘Loose’ or incomplete documents lead to ambiguity, questions, potential additional costs, and additional time and effort during the Construction Administration phase.