Unit Price Contracts (UPC) are contracts used in residential construction projects that establish a unit price for each unit of work or material supplied. With UPCs, the contractor takes on the responsibility of determining the exact quantity of materials and labor needed to complete a project. Prices will typically be based on predetermined measurements such as square footage, linear footage, volume, weight, etc., depending on the scope of work. The agreed upon prices are then multiplied by the quantities to calculate the total cost of the job without any markups from either party. This allows builders to control costs and manage budgets more effectively while also allowing contractors to accurately quote jobs with minimal risk involved. UPCs ensure both parties are transparent about pricing and make it easier for contractors to make bids without under- or overcharging for a project.