I use fixed-price contracts. I believe contracts must be clear and fixed. Fixed price contracts are best because they guarantee in black and white what you are going to get and how much you are going to pay for it. Built into this amount is also a contingency, which is about 10% of the total contract price. This amount is used by both parties if something is forgotten and to cover change orders. Change orders are used when the client changes their mind about something and when unforeseen circumstances arise.

These types of agreements take time to develop as there are often over a hundred components that need to be taken into consideration and accounted for. The time spent before you sign a contract is the most critical and the most time-consuming. This is when all these components are thoroughly discussed and planned in order to ensure a smooth process once building begins.