Do you use performance bonds on your store construction contracts? Should you?
Do you use performance bonds on your store construction contracts? Should you? So, what are performance bonds and how do they work?
A performance bond is given as a guarantee to clients by specialist insurers or banks on behalf of contractors and at their expense. The performance bond would bind the insurers to compensate clients (up to the amount of the bond obtained) in the event of a default by a contractor. For example, a building contractor may issue a bond to a client for the building which the contractor is building. If the contractor does not fulfill the contract per specifications, the client is protected to a guaranteed compensation.
If you’d like to learn more about how SafeSourcing can assist in properly analyzing the total cost of your construction projects including general contractor section, please contact a SafeSourcing customer services associate.