A Cost-Plus Contract is a contractual agreement between two parties, typically the buyer and seller, in which the seller agrees to provide goods or services at an agreed-upon price plus an additional percentage for profit that the buyer has agreed to pay in advance. This agreement allows buyers to feel secure that they are not overpaying for materials or services while sellers are assured of a guaranteed profit. In essence, it provides a win-win situation for both parties. As with any business arrangement, it’s important to ensure that the terms of the agreement are clearly defined and understood by all involved.