In a fixed-price contract, who bears the majority of the financial risk?

Project Management (PMP) Medium

Project Management (PMP) — Medium

In a fixed-price contract, who bears the majority of the financial risk?

Key points

  • Fixed-price contracts transfer financial risk to the seller
  • The seller is responsible for cost overruns
  • Buyers benefit from predictable costs
  • Sellers must accurately estimate project costs

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