This presentation draws on the Commercial Management module of Shutdown School to address critical financial pitfalls associated with major shutdown events, where costs can represent 60–80% of an annual maintenance budget. Shutdowns frequently rely on transient contractor resources, which introduce significant risks related to uncontrolled scope growth and unexpected cost increases.

We will explore best practices to ensure precision of scope from the outset, moving beyond imprecise work definitions that lead to inflated manning levels and unnecessary fees.

The session will detail how to:

• Define and defend the scope of work from initiation through execution, specifically managing tensions related to variations and scope creep that arise when contractors seek work for placed labour.
• Establish transparent commercial arrangements that scrutinise management overhead (recommended not to exceed 15% of total shutdown cost), supervision/ fixed cost items (recommended not to exceed 20%), and material mark-ups.
• Align contractor systems with CMMS /EAMS to facilitate detailed, accurate cost tracking and timely reconciliation. This includes ensuring that contractor payments are only processed when corresponding work order feedback meets a satisfactory standard.
• Implement robust work quality control measures to mitigate the inherent risk associated with contract labour new to the site or type of works, ensuring quality assurance to prevent reliability issues post-shutdown.

This session will show how disciplined commercial control transforms the preparation phase from a financial risk into a mechanism that enforces scope compliance and drives down overall shutdown cost.