What Exactly Is Turnkey Contract

A turnkey contract is a type of construction contract in which a contractor is responsible for completing an entire project from start to finish. The term “turnkey” refers to the fact that the owner of the project only needs to “turn the key” to start using the completed facility or asset. In simple terms, a turnkey contract is a project delivery method where the contractor takes on all aspects of the project, including design, construction, and commissioning.

In a turnkey contract, the contractor takes the responsibility of completing the project as per the owner`s requirements. The contract specifies all the details of the project, including the budget, timeline, and expected deliverables. The contractor is responsible for sourcing all the materials, equipment, and labor needed to complete the project within the stipulated timeframe and budget.

One of the significant advantages of a turnkey contract is that the owner does not have to engage in any aspect of the project. Once the contract is signed, the contractor takes over everything, and the owner can relax and wait for the finished project. The contractor handles all the complexities of the project, including permits, planning, and execution.

Turnkey contracts are prevalent in the construction and engineering industries, where they are used for large-scale projects such as power plants, dams, and hospitals. In these projects, the contractor takes on complete responsibility for the project, from conceptualization to implementation to handover to the owner.

In conclusion, a turnkey contract is a project delivery method where a contractor takes on all aspects of a project, including design, construction, and commissioning. The owner of the project provides the contract, which specifies the budget, timeline, and deliverables. Once signed, the contractor takes responsibility for the project from start to finish. Turnkey contracts are popular in large-scale construction projects, where it allows the owner to relinquish responsibility and have the project completed efficiently and effectively.

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