Question

Consider the hybrid cost plus system. Is this system available for use by all types of businesses? Is it best suitable for a particular type of business? If so, which business?

Answer 1

Hybrid cost plus system:- hybrid cost plus system is most common method of contracting for private commercial construction is reimbursement of the contractor's construction costs plus a fee, with a guaranteed maximum price. Cost-plus contracting offers the allure of "open-book" contracting and provides the opportunity to return all or part of the savings when the costs come in below the guaranteed maximum price. All of the major form contract families have cost-plus contract templates.

mainly hybrid cost plus system used in construction business. there are mainly following type of construction business.

1. Fixed price:- fixed price construction contract also referred to lump sum contract there use hybrid system.

2. Cost plus contract business

3. Guaranteed maximum price