What exactly is a Professional Services Agreement (PSA) and why should you consider signing one? The bigger question is, why wouldn't you want to sign one? A PSA provides a clear understanding of the scope of work, timelines, and actual costs for your construction project. This agreement is essential in a transparent working relationship that ensures you receive the high-quality work and service you deserve.
Many contractors use “allowances” when pricing a project without considering the quality or cost of the fixtures and finishes you eventually choose. This can lead to a significant difference between the contract price and the actual cost of construction. With a PSA, you have the opportunity to work closely with your contractor to select your preliminary fixtures and finishes. Allowing us to accurately base your allowances on your selections, resulting in a more accurate budget.
We can determine a price upfront for projects with fully developed plans, specifications, engineering, and the client’s fixture and finish selections. However, this is only typical for a few projects. There is usually a significant amount of work remaining to finalize the design, make client selections, clarify technical specifications, and develop a preliminary budget that aligns with the client’s price point. This often involves an investment of time. This process can take anywhere from 10 to 100 hours, depending on the project’s size and complexity. For projects requiring this additional work before a reliable price can be established, our Professional Services Agreement outlines what our company is willing to do at no cost (aside from time and travel expenses). It also specifies what we will charge for additional services and how much credit we will provide if the project is awarded to us and a fixed-price contract is signed.
In summary, a Professional Services Agreement is a legally binding contract that establishes the terms and conditions of a construction project. It ensures a smooth and successful project while also providing peace of mind by clearly outlining the quality standards and expected level of service you can expect from us.
