What is a cost-plus contract?

Cost-plus contract (contract with reimbursement of costs and profit) is a type of agreement where the client pays the contractor all incurred expenses for the work plus a pre-agreed percentage of profit or a fixed amount on top.

This type of contract is used when it is difficult to accurately estimate the project cost in advance. It reduces the contractor's risks as all expenses are covered, but requires the client to monitor expenses.

Example: if the contractor spent 100,000 rubles on the project, and the contract provides for a 10% markup, the client will pay 110,000 rubles.