Measured Term Contracts

KOK have over 30 years’ experience in delivering Measured Term Contracts and our experience is our strength.

Measured term contracts, often referred to as MTCs, are a commonly used procurement and contracting method in the construction and infrastructure industries. They are designed to facilitate the management and execution of construction or maintenance work for projects that have a certain level of uncertainty or variability in their scope. Measured term contracts offer flexibility and transparency in project execution and are particularly useful when it is challenging to define the exact extent of work required at the outset of the project.

WHAT IS A MEASURED TERM CONTRACT?

 A MTC is a type of contract where the client (often a government agency or organization) engages a contractor to carry out construction work for a given period. MTCs typically last for three years but can be extended if required and may concentrate on refurbishment, repair, alteration, and minor extension works. Instead of providing detailed designs and specifications for the entire project upfront, the contract outlines the rates, quantities, and methods by which the work will be measured and paid for.

Measured term contracts are frequently used in infrastructure projects like road maintenance, public building repairs, and utility services. Government agencies and municipalities commonly employ this contracting method to ensure cost-effective and responsive maintenance of public assets. KOK are experienced, RICS regulated, Chartered Quantity Surveyors who have worked with a wide range of commercial, governmental, local authority and NHS clients across the UK.

FINANCIAL BENEFITS OF AN MTC

Because you are using one supplier for all jobs, all costs can be predicted and standardised. This makes it easier for you to budget for the length of the term, which reduces the likelihood of any unexpected costs driving you over-budget.

MTCs are a great way of budgeting for construction projects of all sizes and can include provisions for refurbishments and repairs. Using a Quantity Surveyor like KOK who are well versed in MTC, you are assured that costs will be maintained within budget.

INCREASED TRANSPARENCY AND EFFICIENCY WHEN PLANNING CONSTRUCTION PROJECTS

One of the key advantages of Measured Term Contracts is their flexibility. These contracts are particularly suitable for projects where the scope of work may change or evolve over time. This flexibility allows adjustments to be made as the project progresses, accommodating unforeseen circumstances or changes in project requirements.

Measured term contracts have copious benefits when it comes to planning and scheduling multiple projects. For example, when ordering work from the term contractor, each project can be given a priority rating, which not only helps KOK provide an accurate estimate for your work but also gives you an overview of when each project will commence, how long it will take and the costs involved, which is a huge asset when planning both budgets and timescales.

Since the scope of work is not entirely fixed from the outset, measured term contracts typically have procedures for handling variations and changes in the work. These procedures ensure that both parties agree on any modifications and the associated costs or adjustments.

NO NEED TO PUT EACH JOB OUT TO TENDER WITH AN MTC

As you’ll have only one provider carrying out your construction work under a MTC, this negates the need to put each individual project out to tender. Measured term contracts are often awarded through a competitive bidding process. Contractors submit their rates for various work items, and the contract is awarded to the most competitive bidder.

This saves you time, as you won’t have to introduce separate tenders to your business and explain the idiosyncrasies of each project multiple times. What’s more, each job can begin much faster, as you won’t have to go through a separate tender process at the start of every single project or order.

RISK SHARING AND TRANSPARENCY

Measured term contracts often involve risk-sharing mechanisms. Contractors may be incentivized to complete work efficiently and within budget, as they can benefit from cost savings. Conversely, they may be responsible for cost overruns.

Transparency is a crucial element in measured term contracts. Detailed records of work performed, quantities measured, and payments made are maintained throughout the contract period. This transparency helps in auditing and verifying the contractor’s performance.

SUMMARY

In summary, measured term contracts provide a flexible and transparent approach to managing construction and maintenance projects, allowing for adjustments as the project progresses. They are particularly well-suited for projects with uncertain or evolving scopes of work, providing a balance between cost control and adaptability. Effective management and communication between the client and contractor are essential for the successful execution of measured term contracts.

KOK have a team of experts who understand the importance of team working, partnering, communication and clear transmission of information.

Measured Term Contracts give Client’s peace of mind that you have a reliable construction team on hand ready for facilities management, small refurbishments and repairs or alterations, extensions, and new builds alike, without having to go through the time consuming and often costly exercise of putting each small project, job or order out to tender.

At KOK, we pride ourselves in providing high quality construction consultancy services putting safety management first whilst balancing time and cost management. Our Chartered Quantity Surveyors will also check the measure of the work as it progresses and report on costs in a disciplined and concise manner. We encourage the Client to use formal change control procedures and to hold regular meetings with the contractor and KOK to discuss progress, quality, safety, and cost.

KOK further enhance our service by having a team of highly experienced CDM Advisors who are available for your MTC project. Our qualified professionals will ensure all your construction projects meet CDM Regulations and the highest standards of health and safety.

To learn more about KOK’s Chartered Quantity Surveyors, experienced CDM Advisors and how working with KOK’s measured term contracts can save time and money CONTACT US HERE!