What is a Fee?

Fees are part of most contracts and they might be fixed or variable. Fixed means that for a specific service you have to pay an extra fixed sum to benefit from it these contracts are called cost plus fixed fee contracts. The variable one means that the fee might change in a preset range it eighter goes up or down but it won’t exceed the set limits and these changes reflect risk factors, contracts like this are called cost plus incentive fee contracts. The fee usually follows a contract when there are factors like risk which are related to the contract then the fee comes in play when the goods or services are over the initial cost estimations.