Cost Plus Fixed Fee Contracts (CPFF) are contractual agreements between two or more parties wherein the seller is reimbursed for all direct costs and given a predetermined fee. Put simply, CPFFs are an arrangement where the buyer agrees to pay the seller a fixed amount in addition to the actual costs incurred by the seller in providing a product or service. This contract type is often used for government contracting and provides organizations with the security of knowing their total investment before beginning a project. With CPFF contracts, sellers are able to accurately estimate their pricing, deliver services over time and manage resources efficiently. Additionally, businesses have the flexibility to adjust their scope of work as conditions change during the life of the project. Ultimately, CPFF contracts can help drive greater cost savings for buyers, while simultaneously enabling vendors to make fair and reasonable profit margins.