What is an essential characteristic of the Percentage-based Fee system?

The percentage-based fee system is characterized by its flexibility in pricing, which is closely tied to the scale and complexity of the project. This system typically involves a fee that is calculated as a percentage of the total costs incurred during a construction or service project. As the size or complexity of the project increases, so does the total cost, which directly affects the fee amount. This variability allows clients and contractors to align the fee structure with the specific demands and parameters of each unique project, ensuring that the cost reflects the actual workload and resources required.

This characteristic is crucial because it enables a more precise alignment of compensation with project specifics, allowing contractors to adapt their fees based on factors such as the intricacy of the work, the level of risk involved, and the overall project duration.