XL EagleFFP (Firm-Fixed-Price)
FFP stands for Firm-Fixed-Price. A firm-fixed-price contract pays a set price for a defined job. If the work costs you less, you keep the difference. If it costs you more, you eat the loss. The price only changes if the government changes the work through a formal modification.
FFP is the most common contract type for trades work like mowing, janitorial, HVAC service and supply deliveries. The government likes it because its cost is known up front. You carry the cost risk, so your price has to cover surprises.
Why it matters to a small contractor
Most small contracts you will see are FFP. That means your quote is your promise. Walk the site if you can, read the scope twice, and build in room for fuel, labor and material swings before you send a number.
Example
A base asks for weekly mowing of 40 acres for a year. A crew bids $52,000 FFP. Diesel jumps and the job ends up costing $49,000, so the crew earns $3,000. If costs had hit $55,000, the crew would have lost $3,000.
FFP: common questions
Can I ask for more money on an FFP job if costs go up?
Not just because your costs went up. You can ask for more only if the government changed the work, caused a delay, or the contract has a price adjustment clause. Keep records so you can show what changed.
Is FFP good for small businesses?
It can be very good if you know your costs well. It rewards efficient crews. It hurts when the scope is vague and you guessed low.
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