We are often asked about the types of contracts used by Olivewood Builders. Below is a brief explanation of these contracting methods. Should you have further questions please contact us.

Lump Sum  
A Lump Sum or Stipulated Sum contract is an agreement between a contractor and owner were the contractor agrees to provide specified services (scope of work fully defined) to an owner for a specific price and the owner agrees to pay, based on a payment schedule. 

Cost of the Work Plus a Fee  
In this contract method the contractor’s fee percentage is fixed. The contractor provides the owner with a cost estimate of the work based on a scope of work determined by the contract documents. No maximum price is established. This contracting method is used when the scope of work is not well defined and/or drawings and details are not complete.

Cost of the Work Plus a Fee with a “Guaranteed Maximum Price”  
This is similar to "Cost of the work" above, however a maximum price is established in a similar fashion as in a lump sum contract and the “Guaranteed Maximum Price” cannot be changed without a change in scope of work. The benefits of this type of contract are the savings that result from multiple bids on trade items.

Construction Management  
With Construction Management Olivewood Builders is hired shortly after the design team and act as planners, technical consultants and advisors during preconstruction. The client acts as the General Contractor and contracts directly with each trade and supplier and pays them directly. Olivewood serves as advisors and technical consultants in negotiating contract prices and terms and preparing monthly statements.

  1. This type of contract works best when the client wants to be very involved in the project and the budget is a guide line for a design-build or fast-track project. Clients/Owners may realize up to 5% savings by assuming the risk of being their own contractor.

  2. The services provided by Olivewood, are the same as the other contracts described above, we prepare the Budget, Scope of Work, and Schedule just as if we were the “Builder”. All the same project reports are generated and provided; in some instances there is more reporting. The monthly statements are itemized and tailored for easy understanding and quick payments.

  3. Quality Control is provided through regular site visits or onsite supervision with reports to the Owner/Client.

We want you to be fully satisfied when working with Olivewood Builders. The Contractors State License Board is an excellent resource for homeowners seeking further information about contractors, license requirements, bond information, and contract writing guides..