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Figure 49：Spectrum of distributed contract risks
2) Sydney Metro City& Southwest, Southwest Metro, Mechanical Gap Fillers (MGF) and Platform Screen Doors(PSD) Product Proving Deed
3)Sydney Metro City& Southwest Lifts and Escalators Framework Contract
4) Sydney Metro City& Southwest Building Management and Control System Framework Contract.
9.5.2 Contract Price Type Selection
Lump Sum price including FPIF price type which is the most common type of contract in the world will be selected as this project’s contract price type.
According to the spectrum of distributed contract risks, Fixed Price Type tends to result in a higher risk being posed to seller’s side. It indicates that when buyer signs a lump sum contract with vendor, a large proportion of risk will be transferred to seller’s side.
Figure 49：Spectrum of distributed contract risks
Furthermore, based on the assumption in cost management plan, the cost contingency of the procurement with respect to two different price types will be calculated and in this procurement management plan Monte Carlo Simulation for this cost contingency calculation will run for 10,000 iterations. And the outcome can be generated by utilising Excel @Risk and demonstrated in figure 50.
