Turnkey project meaning explained: What is turnkey contract and examples
Big infrastructure initiatives are often created using a combination of approaches. Turnkey project development is one of these ways. In this essay, we go over all you need to know regarding turnkey projects.
What is the definition of a turnkey project?
According to the Oxford Dictionary, the adjective ‘turnkey’ refers to something that is ‘complete and ready to use right away.’ The notion of a turnkey project stays the same when applied to project development. A turnkey project is one that is conceived, constructed, and equipped with all necessary facilities under the terms of a contract by a corporation. When it is ready to start doing business, it is sold to a buyer. Obviously, the firm in charge of constructing a turnkey project does so for the agreed-upon price. The company’s turnkey project work includes design, manufacturing, installation, aftermarket support, and technical service.
Features of a turnkey project
Rather than doing everything themselves, a firm in need of a manufacturing or services facility employs a third-party operator to design and develop it. Everything from production to support sustainable operations is the responsibility of the third-party contractor.
Instances of turnkey projects
Turnkey projects account for the bulk of government-funded large-scale infrastructure projects. For example, the forthcoming Jewar Airport project is a turnkey project. Zurich Airport International, a Swiss firm, is working on it. The airport will be given over to the local government to operate after it has been completely constructed. A turnkey property is a completely equipped flat or apartment which you may buy and rent right away on the property market.
The advantages of turnkey projects
Such initiatives, sometimes known as turn-key, benefit both the company that creates them and the player who finally takes ownership of them. The following are some of the significant advantages of turnkey projects:
- Cost-cutting: A corporation engages companies who are prepared to do projects for a set price.
- Companies save time and money since they don’t have to invest time and money creating a facility. Instead, they can focus on growing their own enterprises.
- Free of legal and technical obstacles: Because someone is devoting time and energy to building the facility, the main operator is free of all types of legal and technical challenges, which are an inevitable part of project development, especially in a nation like India.
- Expert expertise and technological know-how are available: A textile firm may not be an expert in the construction and operation of a textile production facility. As a result, turnkey projects allow them to recruit professionals in the relevant industry.
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