6 Important Steps for a Contractor Prior to Signing a Construction Contract.

Strategies for Contractors to Mitigate Risks and Identify Opportunities in a Construction Contract:

  1. Review Scope of Work: Ensure the contract documents clearly outline existing and special site conditions, material specifications, and the intended sequence of work.
  2. Verify Estimates and Quantities: Confirm that the contract line items, and their corresponding quantities accurately reflect the cost proposal provided.
  3. Clarify Payment Terms: Understand the payment schedules, amounts, and conditions to ensure timely cash flow throughout the project.
  4. Assess Timelines: Ensure the master or baseline project schedule aligns with the agreed start and completion dates. Familiarize yourself with the change order procedures.
  5. Evaluate Performance Provisions: Understand the contractual provisions for incentives, disincentives, penalties, and liquidated damages to manage performance expectations effectively.
  6. Review Termination Clauses: Be aware of the conditions under which any party can terminate the contract to prepare for potential changes in the project scope.

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