Lump sum contract
A fixed-price contract where the contractor agrees to complete the project for a set amount.
Lump sum contracts provide a single fixed price for all work specified, offering predictability in budgeting but potentially leading to disputes over scope changes or unforeseen conditions.
Used in a sentence
Under a lump sum contract, the contractor agrees to complete the project for a fixed price regardless of incurred costs.
Synonyms/variation
Fixed Price Contract
Stay updated on what’s happening in construction.
Subscribe to Blueprint, Procore’s free construction newsletter, to get content from industry experts delivered straight to your inbox.
Learn MoreLearn more about Lump sum contract
Using Standard Operating Procedures for Better Contract Management
Every construction project is different, meaning that GCs have to be continually agile and strategic about applying their experience. Major categories change from project to project, from the owner to the delivery method. Fortunately, that doesn’t mean the GC goes into the project blind: They have the contract to guide them. The contract documents should […]
Understanding Supplementary Conditions on Construction Contracts
No two construction projects are exactly alike — and the same goes for construction contracts. Even when using a standard contract form, owners and contractors sometimes use supplementary conditions to shape the contract documents to fit the project at hand better. Supplementary conditions may add additional information that isn’t included in standard contract terms, alter […]
A Straightforward Guide to Construction Contract Review
Construction contracts are like the glue for the project team. They’re the ties that bind the working relationships and goals for the project, containing information about responsibilities, liabilities and processes that govern a relationship between construction stakeholders. Despite their importance, contracts are long, and project team members are busy — so it’s easy to understand […]
Escalation Clauses in Construction Contracts: When and How They Apply
In construction contracts, an escalation clause allows for the escalation of a certain price for labor or materials to be used in a construction project. This type of clause is most commonly used to account for the potential fluctuation of material prices throughout the life of the project. It safeguards the contractor, allowing for adjustments in […]
How can we improve this glossary entry?
By clicking this button, you agree to our Privacy Notice and Terms of Service.