• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar

Project Management Knowledge

Simply explained by a PMI-certified Project Manager

  • Home
  • Acronyms and Abbreviations
  • Definitions
  • About the Author
  • Deutsch
  • Show Search
Hide Search
You are here: Home / Definitions / C / Cost-Plus-Fee

Cost-Plus-Fee

The cost-plus-fee is also referred to by the abbreviation of CPF, and represents a variant of a cost reimbursable contract in which the buyer provides reimbursement to the selling party for the allowable costs that have been accrued by the seller in the commission of the service, the creation, manufacture, delivery of the product, or in any other performance of the contracted work. In addition to this reimbursement, the seller also receives a fee that has been previously determined and calculated as a percentage measure of the total costs. The fee in these situations will tend to vary with the actual costs. Cost-plus-fee is advantageous to the seller because it allows for some baseline costs and expenditures to be reimbursed in a more guaranteed way, but also allows for the opportunity to modify fees based on percentages. As such, as budgets swell the percentage remains fixed, however the resulting fee grows accordingly.

This term is defined in the 3rd edition of the PMBOK but not in the 4th.

Related Articles:

 
  • Cost-Plus-Fixed-Fee (CPFF) Contract  The cost-plus-fee contract is also referred to by the abbreviation of CPFF, and represents a variant of a cost reimbursable...
  •  
  • Cost-Reimbursable Contract  A cost-reimbursable contract is a variant of a contract that involves making a payment from the buyer to the seller...
  •  
  • Cost-Plus-Percentage of Cost (CPPC)  See cost-plus-fee. This term is defined in the 3rd and the 4th edition of the PMBOK. Get free Project Management...
  •  
  • Cost-Plus-Percentage of Cost (CPPC)  In project management, there are different types of contracts that buyers and sellers should be aware of.  Among the many...
  •  
  • Cost  Cost refers to the monetary value or financial pricing of a specific project activity. This cost includes all anticipated expenditures...
  • Primary Sidebar

    Dear Visitor, I am a PMP (Project Management Professional), certified by the Project Management Institute since 2004. I have been managing dozens of projects, small and huge, successful and unsuccessful. This site is supposed to help you learn the required vocabulary of the project management world. Please feel free to check my certification status or to learn more about me.

    Copyright © 2021

    • Privacy Policy