1) How Progress Payments Work
Each period, executed quantities are measured, priced at contract unit rates and paid cumulatively. Jointly signed measurement sheets and dated photos protect both sides. Incomplete or defective items should not be certified.
2) Retention, Advance and Deductions
Define advance recovery, retention percentage and return conditions at signing so they are not renegotiated every period. These rules shape the financial discipline of the construction process.
3) The Risk of Fixed Sums in Inflation
A fixed sum on a long job either gets priced with a heavy risk premium or leads to slowdowns and quality cuts. Fair, predictable risk sharing is often the cheaper route.
4) Price Adjustment Clause
Specify covered items, the index or source, the base date and frequency. Two-way formulas, thresholds and caps improve predictability. Tailor formulas to the job and obtain legal review; our consultancy team can support the rationale.
5) Documentation
Archive index publications, invoices, order dates, measured quantities and calculation sheets with each payment application. Record variations through written instructions and new unit-price memos.
6) Delay, Variations and Cost
Whoever causes a delay should bear its cost; define force majeure and permit delays separately. In restoration, set approval rules for extra work and use of contingency. See historic building restoration cost.
7) Common Mistakes
Leaving price adjustment for later, vague indices, approving estimates without measurement and unrecorded variations are the typical errors.
8) Conclusion
Clear scope, open indices and steady documentation keep both parties predictable. Contact our restoration and construction teams through contact.