Mark-up FEE

Mark-up fees are a critical component of client contracts, allowing General Contractors (GCs) to adjust project costs by adding fees to specific budget line items. This article explores the concept of Mark-up Fees in client contracts, including how to add, calculate, and display them.

Adding Mark-up Fees

GCs have the option to include Mark-up Fees for budget line items in a client contract. To enable Mark-up Fee for budget line items, in the budget settings of Budget Manager, the 'Allow to add line item Mark-up Fee' field must be enabled. 

Once this setting is enabled, when the line item is opened, in the right pane under ‘Budget Details’ section, a new field appears ‘Do you want to add a Mark-up Fee?’. Here, GCs can enter the Mark-up Fee in either an Amount or Percentage format. These fees are meant to adjust the cost of individual budget line items.

Once the Fee is entered and the item is saved, this is displayed in the new ‘Mark-up Fee’ column in the budget line item grid.

Calculating Mark-up Fees

The total Mark-up Fee for the client contract is the sum of Mark-up Fees applied to selected budget line items. This total is added to the Original Contract Amount, effectively impacting the overall project cost and Billing Schedule.

Displaying Mark-up Fees

To provide transparency to GCs, the new contract amount with Mark-up Fees included is displayed under the 'Billing Schedule' tab. This information allows GCs to see the adjusted contract amount and plan their billing schedules accordingly.

Contract FEE

A Contract Fee is a separate type of fee within client contracts, serving a different purpose compared to Mark-up Fees. This section highlights the significance of Contract Fees, how to add them, calculate their impact on the contract amount, and where to view the updated contract details.

Adding a Contract Fee

When creating a client contract, GCs can opt to include a Contract Fee. This fee is entered as a percentage of the contract amount or as a specific dollar amount. GCs can choose the option that aligns with their project requirements.

Calculating Contract Fees

The inclusion of a Contract Fee alters the contract amount by adding the fee to the Original Contract Amount. The contract amount after adding the Contract Fee becomes the New Original Contract Value, which may impact how billing schedules are calculated.

Displaying Contract Fees

Contract Fees are prominently displayed in the contract details. The 'Original Contract Amount' field shows the updated value with the Contract Fee appended. Additionally, the billing schedule takes into account this new contract amount, ensuring accurate calculations.

In summary, Mark-up Fees and Contract Fees offer flexibility and customization in client contracts. Mark-up Fees allow for fine-tuning individual budget line items, while Contract Fees introduce an additional fee to the overall project cost. Both fee types are visible in contract details and billing schedules, empowering GCs to manage costs and plan accordingly within their client contracts.

Last Updated: Dec-11-23