| dc.description.abstract | The scale of public construction work is huge; however, under extreme competition, profitless has become an inevitable phenomena for the construction industry. Contractors are awarded bids through open bid process. The contract price includes compensation for political, economical and construction risks. Any carelessness could lead to serious losses. Thus, in order to gain profit, whether the management could overall control risks and stand it’s rights and interests or not becomes the key point of the project.
Lump-sump public construction work has become more and more popular in Taiwan. Under limited bidding time, bidders estimate cost base on preliminary drawings and specification. Risks could occur due to complicated work condition and impact deeply to the project.
Even after the project is awarded, owner and contractor discusses the design in details. In this stage, if owner or PCM are not aware of the function and scale of the work and cannot get used to proceeding detail design and construction parallelly, the project will suffer from revision of requirements or requirements which are out of contract scope. As a result, the contractor has to revise work plan and will not be able to control schedule and cost which can lead to argument or dispute.
“ Risks allowable margin” is to design a mechanism in project contract, contractor has to complete all scope of work within project duration under a fix price. The difference of “actual quantity take off costs” and “bidding stage estimate quantity take off costs” are “cost misestimate risk”.
The research is to discuss the contractor’s cost risk issues during quotation stage for bidding a fixed lump-sump work. | en_US |