Meaning | Benefits | Project Example
Turnkey project development is one of the most commonly used methods for large-scale infrastructure projects.
What Is A Turnkey Project?
As per the Oxford Dictionary, turnkey stands for something which means anything complete and ready to be used immediately.
When you apply this concept to the project development phase, it will remain the same. A turnkey project is one in which all the different activities including but not limited to design, development, equipment acquisition, and more, are handled by a single company under a contract. The project is then handed over to the buyer when it becomes ready to be operated.
The contract will clearly outline the cost that will be incurred in making the whole business model. It can include several sub-aspects and each one of them had to be integrated and incorporated in the right manner to make the final delivery fit for use. For instance, if you take the real estate sector, a turn-key project would be a fully furnished flat which is in a ready-to-move state.
The Benefits
Here are some of the benefits of a turnkey project. Mostly it has been seen that both the developer and the player who will ultimately get hold of the project will be benefited from this association. Let us see the salient benefits.
- Cost saving: As the cost is mentioned in the contract and a third-party company with the right expertise does the development, it mostly ends up saving cost
- Hassle-free: As you outsource a greater part of development, you end up being free from the different aspects of development. You don’t need to bother about legal or technological challenges. This helps in eliminating hassles.
- Saves time: There is no denying the fact that choosing to outsource development to a skilled company helps you save time that can be used for other constructive purposes.
So, it has become a very popular choice and is used often, especially in countries like India where every step could entail significant time otherwise.
The Project Examples
To give you a clear picture, let us share some of the project examples.
Most of the large-scale infrastructure projects that have been government funded tend to be turnkey projects. For example, the Jewar airport project is a turnkey project. The whole development has been outsourced to Zurich International Airport. When it is fully done, it will then be handed over to the local authorities for seamless operation.
When you buy a fully furnished ready-to-move-in flat, it is a classic example of a turnkey project.
So, you will find several such instances. It is surely a great way to co-work.
Related: Brownfield Project