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| What Type of Contract Do You Require - Guaranteed Performance |
In this Contract there is more risk with the Contractor who has to achieve agreed budget requirements. Staff and overhead costs are normally fixed. There is a minimum revenue target to be achieved. If revenue is exceeded the Client benefits as the gross profit percentage is fixed. This type of contract is especially suitable for businesses who are expanding or who have less time to monitor the contract.
The main characteristics are:
a. Guaranteed Gross profit percentage returned to Client
b. Guaranteed revenue targets to be achieved by the Contractor
c. Increased Risk to Contractor
d. Other Costs can be fixed
e. Net Prices for Credit sales
F. No discount retention by the Contractor, unless declared
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