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Cost Plus Fee

oboloo Glossary

Cost Plus Fee

Cost Plus Fee is a pricing structure under which a buyer agrees to pay all of a seller’s costs for a project, plus an additional fee. This pricing structure guarantees the seller a minimum level of profit, regardless of changes in cost or market conditions. With Cost Plus Fee, the buyer and seller agree on a fixed percentage that will be added to the total cost of the project as the fee. This ensures that the seller will still get paid even if the project goes over budget or takes longer than anticipated. Overall, Cost Plus Fee is an ideal agreement for situations where there are too many unknowns to accurately estimate project costs, thereby ensuring both buyer and seller peace of mind.

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