Job Order Contracting - Compare & Contrast Information

There are many types of contracts that can be used to accomplish the small to medium sized maintenance & repair jobs that facility owners face every day. The following table illustrates the best use for each of the different types of contracts. Click on the contract for a synopsis.

Contract Type	Best Use	Pros	Cons	Project Size
JOC – Job Order Contact	Multi-traded small to medium sized maintenance, repair and minor new construction.	Saves considerable time, money and improves quality.	Must use a pre-priced book of construction tasks. Off the shelf estimating guides are not appropriate.	$5,000 to $1,000,000
SABER – Simplified Acquisition of Base Engineering Requirements	Multi-traded small to medium sized maintenance, repair and minor new construction.	Saves considerable time, money and improves quality.	Must use a pre-priced book of construction tasks. Off the shelf estimating guides are not appropriate.	$5,000 to $1,000,000
TOC - Task Order Contract	Multi-traded small to medium sized maintenance, repair and minor new construction.	Saves considerable time.	More expensive than other methods.	$5,000 to $1,000,000
Term/Requirements Contract	Single traded small to medium sized new construction.	Saves considerable time and money.	Unbalanced bidding and tasks often occur outside of original scope. Administrative burden verifying installed quantities.	< $100,000
SOC – Solution Order Contract	Medium new construction.	Faster than traditional design-build and design-bid-build.	More expensive than most other contract methods.	> $1,000,000
MATOC – Multiple Award Task Order Contract	Medium new construction.	Faster than traditional design-build and design-bid-build.	More expensive than most other contract methods.	> $1,000,000
Design-Bid-Build	Large New Construction	Comprehensive design prior to construction.	Extremely slow process. Changes and claims are common.	> $1,000,000
Design-Build	Medium to large new construction projects.	Faster than design-bid-build and promotes innovation. Shifts more risk to contractor.	Few when award is based on Best Value or Qualifications.	> $1,000,000
Contractor at Risk	Medium to large new construction projects	Faster than design-bid-build. Shifts financial risk to contractor.	Expensive. Contracts typically have loopholes allowing contractors to reduce risk.	> $1,000,000

JOC is a firm fixed-price indefinite quantity contract which contains an extensive database of priced construction & construction related tasks. Job Orders issued under a master contract are priced using the tasks from the database. JOC saves on costs from project procurement to construction. Jobs are jointly scoped by the facility owner and the contractor eliminating the need for costly bid documents. The joint scope virtually eliminates changes and claims. Construction typically starts within weeks of a project being identified compared to months under traditional systems. The contractor receives future job orders based on the facility owner’s satisfaction with current job orders thus ensuring high quality work.

TOC is a multiple award construction contract. Each order under the contract is competitively bid among pre-selected firms. The pre-selected contractors must prepare a proposal for each and every job. This increases the contractor’s overhead and therefore the cost to facility owner is higher than a JOC or SABER

A term contract is typically a single trade contract where the facility owner lists items that they want to accomplish and the anticipated quantities. The contractor bids the unit prices for each of the items. These contracts are notorious for unbalanced bidding. The contractor often seems to know anticipated quantities better than the facility owner and uses that to their advantage. These contracts are also problematic when work must be accomplished that is not listed as one of the items.

SOC is a multiple award design-build contract. Each order under the contract is competitively bid among pre-selected firms. The best “solution” for each order wins. This is a very expensive approach to construction. Each of the pre-selected firms must prepare a solution for each order. This often involves design and engineering. The facility owner is paying for redundant design and engineering on each order for as many pre-selected firms they have under contract.

Design-Bid-Build is the traditional method of construction contracting whereby a project is designed (in-house or by outside firm), advertised for bid, and contracted to the low bidder. This method of construction has its place with the large new construction projects but is too costly and time consuming for the small to medium sized projects. Change orders and claims are common with this process.

Design-Build is a single contract for both the design and construction based on design criteria set by the facility owner. This method of construction shifts some of the risk to the contractor and expedites the construction process. It allows the contractor flexibility for innovation in all aspects of the design construction process. Change orders and claims are reduced with this process.

CM at Risk is a contract under which a contractor guarantees a maximum fixed price and is at risk if the price goes above that. Contractors are typically involved in the design and engineering stages of a project to help them minimize their risk. CM at risk is generally used on large capital projects where budgets must not be exceeded. It is not appropriate for small to medium size projects where risk is minimal to start with. The transfer of risk comes at a price. The CM at risk contracts are generally more expensive than other contracting methods. For CM at risk contracts that are based on a percent of construction, there are no incentives to keep costs under control.