cost plus
Expense-based markup method
Cost plus is a pricing method where the final price equals the actual cost of production plus a fixed fee or percentage markup.
Common in construction and government contracts where total costs are unpredictable: a cost-plus contract.
The buyer agrees to cover all expenses and guarantee the seller a profit margin on top.
- construction contractsAgreements governing building projects
- fixed feePredetermined, unchanging charge
- markupAdded percentage for profit
- profit marginRevenue exceeding costs ratio
- defense contractorCompany producing military goods
government contracts · expense tracking · bottom line · tiered pricing · penetration pricing · fair market value · partnership agreement · economies of scale · surplus · supply and demand · dynamic pricing · resource allocation · billing · contractor · competitive pricing · procurement · reimbursement
- pricing modelssubscription, volume discounts, bulk pricing, freemium, pay per use
- procurementprocurement, purchasing, purchase order, bidding, subcontract
- pricingpricing, discount price, overpricing, discounts, overcharge
- contractsbinding contracts, contract length, lease, clause, contract terms
- project managementproject, project manager, task, tasks, deadline
- defense procurementdefense contracts, military procurement, military contracts, defense contracting, government contracts
cost plusfixed-price
Unchanging cost arrangement
lump sum · flat rate · turnkey · unit price · time and materials
cost, plus, costs, costing, costly, costless, costliness, costed