Cost-Plus Construction Model
The difference between the Virk Construction Management and the conventional builders is our Cost Plus Model or cost plus construction contract. Our model is an open-book, collaborative engagement, unlike the rigid lump sum approach which provides the client with absolute control and transparency. This guarantees ethical and transparent project costings, all the money is recorded and clients can tell precisely what happens to their money.
Under a cost plus contract NSW and in Canberra, we competitively tender every trade package to the open market. This approach ensures the most competitive prices and best value of money without compromising on quality. We also have good supplier relationships, and we transfer commercial discounts to our clients.
The advantages of cost plus contract arrangements are clear. Our customers save a lot of money since we charge less in builder fees and whatever we negotiate goes straight back to the customer. The other significant advantage is flexibility. There are no hidden costs on variations and it can be more easily adapted to designs and scope variations as the projects advance. A high proportion of our clients save 10% or more than in conventional lump-sum contracts.
We also specialise in Construction Planning Canberra. Where each and every residential and commercial project is handled with accuracy, effectiveness and transparency throughout the whole project. We integrate professional project management with a partnering relationship that allows you to make decisions at each phase.
You can be assured of fairness, saving, and peace of mind. Whether you are constructing a home or are executing a commercial development with Virk Construction Management using a cost plus contract. Get in touch with us today to find out how we can make your project smarter.
Transparent Construction Services with the Open Book Cost Model
Contract model is one of the most critical decisions that you will make when it comes to construction projects. The type of contract determines the level of cost visibility, quality management, and your experience with the whole project. We use the Open Book Cost Model in Virk Construction Management and it is becoming more ethical, transparent, and client-focused than the traditional Closed Book Cost Model.
What is the Open-Book (Cost Plus) Model?
Open Book Cost Model or Cost Plus Model provides clients with full insight into cost of the project. All costs including material and labour as well as sub contractor costs are transparent. The builder then uses a fixed service fee, which is settled in advance and there are no secret mark-ups and exaggerated prices. This structure forms an amicable, fair relationship where the clients have complete ownership and they trust their budget.
The Problems with the Closed-Book (Lump Sum) Model
A Closed Book Cost Model - also called a Lump Sum contract - is a fixed price on the whole project. Although it might sound appealing, this model causes issues to clients which may include:
Unidentified Costs and Variations: Incomplete designs or changes during the project always cause very expensive variations that tend to swell the budget fast.
Reduced Quality: In order to safeguard profit margins, certain builders can choose lower quality materials, unskilled labor or skimming corners in construction.
Absence of Transparency: Clients do not often view the breakdown of costs, and this may lead to confusion, mistrust, and frustration.
This lack of visibility and flexibility makes the Closed Book model less suitable for clients seeking fairness and peace of mind.
Why the Open-Book Model is More Ethical
We know transparency helps to build trust at Virk Construction Management. The Open-Book (Cost Plus) model offers a transparent, flexible, and ethical approach to construction projects. By choosing this model, clients benefit from cost clarity, superior quality, and a collaborative relationship with their builder. Avoid the pitfalls of Lump Sum contracts and ensure your construction project is completed to the highest standards without hidden costs.
The Open Book Cost Model is useful to clients in a number of significant ways:
Transparent Costs: All the money being spent is transparent and explained, removing the cost fees and exaggerated expenses.
Great Quality Control: Constructors have the freedom to use high-quality material and labor force because the cost is reimbursed at affordable rates.
Fair Variations: Variations in design or some unexpected problems are openly debated and accepted by the clients before any further work is carried out.
Making Decisions Collectively: Clients will continue to feel engaged in project planning and budgeting and will be involved in seeing the result as it is expected to be.
Flexibility With No Punishment: Unlike the Closed Book Cost Model, Open Book does not punish the client by charging a high price.
Residential and Commercial Applications
The Open Book Cost Model fits perfectly well on projects of any size, be it a dream house or a massive commercial real estate project. Our team adds precision and transparency to construction planning, thus you have a smoother building process with fewer surprises and more savings.
Why Partner With Virk Construction Management?
The decision to select Virk Construction Management is a decision to select fairness, transparency, and quality. We are determined to complete projects that meet your vision, your budget and even surpass your expectations. Our Open Book Cost Model will provide you with a smarter more ethical substitute to the old-fashioned Closed Book Cost Models.