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Negotiate fee from client perspective

hiennguyen

Hi all,

We all knew that architect' fee comes with experience, expertise, etc. Some charge $150, $90, or even $15/hr...

I know what my service worths, and I hate negotiate fee. I wanted to send out proposal with "non-negotiable fee" clause every time, yet feel like it a bit cold to say so. 

I wonder what a potential client would feel from their perspective.

 
Jul 4, 21 2:00 am
Non Sequitur

negotiate scope and adjust your fee to suit. Don’t negotiate hourly numbers…

Jul 4, 21 8:33 am  · 
1  · 
SneakyPete

Does your firm include a schedule of hourly rates in the contract?

Jul 22, 21 5:40 pm  · 
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Almosthip

mine does

Jul 22, 21 5:41 pm  · 
2  · 
Non Sequitur

Pete, yes we typically do as do most of our consultants.

Jul 22, 21 6:21 pm  · 
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SneakyPete

So with that they can do some simple maths to convert whatever fee you negotiate into hours.

Jul 22, 21 6:24 pm  · 
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Non Sequitur

Sure, but like I mentioned somewhere else on this discussion, those numbers as listed for additional services only.

Jul 22, 21 8:18 pm  · 
2  · 
Wood Guy

I guess I'm lucky that I can't recall a client trying to negotiate my hourly rate. Total cost to do the work, sure. Maybe it's more of a thing in places other than the northeast US where I work. Can you provide a fixed fee? There are pros and cons, but I know a lot of architects who say they make more money and have happier clients with fixed fees. 

Jul 4, 21 11:30 am  · 
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hiennguyen

Maybe I m wrong, but reduce fixed fee means reduce hourly fee, because the scope does not change. I have not seen reduced scope happened in my life, only the opposite.

Jul 4, 21 3:53 pm  · 
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Non Sequitur

If we reduce our fee, we always reduce scope. Hourly $ is only relevant for additional scope after the contract.

Jul 4, 21 5:39 pm  · 
2  · 
RJ87

That's something I think a lot of clients don't get. If I agree to reduce our fee it means I'm going to do less, not make less money per hour. Even if I don't say so.

Jul 5, 21 4:00 pm  · 
2  · 

Reduction in fee = reduction of the scope of the project. We NEVER reduce our hourly rate.

Jul 22, 21 6:49 pm  · 
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JGGreene

Client Perspective Here: My husband and I hired an architect to draw plans for a two-story addition. Two important pieces of background info: 1) my husband bills hourly on files in his line of work. 2) We both believe that a man/woman is worth his/her wages. Now,... to the pit in my stomach... When we met with the architect we advised that we were interested in getting a conceptual plan to present to our builder who would then give us a "ballpark"  quote but not firm, which would come later based on the cost of materials selected, etc. So far so good. We presented the architect with specific suggestions and indicated that since this property was a vacation home, we just wanted a rather plain, functional (to meet the needs of our grown adult children plus spouses)  home. Currently, we are $7,700.00 into their fees and we are still in Phase One. Does this seem reasonable? We just wanted to find out if this proposed addition would be feasible and not overprice our home in the market in the future. Now I have a pit in my stomach about moving forward. BTW, I thought the hourly rates were acceptable: Lead Architect at $ 155.00/hr and a secondary architect at $85.00. Thanks in advance

Jul 22, 21 5:03 pm  · 
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SneakyPete

A sum of fee paid out is not something that can be immediately identified as reasonable or not. It depends on the contract, your requests and instructions, as well as the architect's time investment when compared to those. Billing rates seem fine, but it depends on where you're at.

Jul 22, 21 5:39 pm  · 
1  · 
gibbost

Billing rates seem appropriate. Sounds like this comes down to communication. If it was made clear that this was an initial feasibility study, then $7k+ seems like a lot. I would have probably assumed about half of that for a quick study to handover to a GC for pricing. But as Pete points out above, it depends on how much information was collected and incorporated into the deliverables. A basic floor plan and elevation/section would be plenty for a GC to determine order of magnitude.

Jul 22, 21 6:09 pm  · 
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JGGG - 

Where is the work located? 

 What size is the addition? 

How many stories is the existing building?

How much interior remodeling was required?

What condition is the existing building in?

Did the architect need to very the condition of the existing structural, MEP, ect of the building? 

Did the architect need to have a site survey done?

How stringent are the zoning requirements for the existing property?


All of these can drastically impact the cost of the work. 

Jul 22, 21 6:52 pm  · 
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proto

@JGGreene, we've had Schematic Design phase totals up to twice that amount & the billable rate here is less. (But plenty are less as well.) It's all about scope complexity & level of service. Even when hourly, I would expect the architect to propose a target number to handle your proposed project that is based on experience with other projects similar to yours. Then, the total may vary some based on your interactions with the architect (meetings, questions, revisions) but should generally be in the right ballpark. And a conversation about any changes to expectations is reasonable.

Jul 22, 21 8:51 pm  · 
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gibbost

  

Jul 22, 21 6:09 pm  · 
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Wood Guy

Well said.

Jul 23, 21 10:21 am  · 
1  · 
JonathanLivingston

"presented the architect with specific suggestions and indicated that since this property was a vacation home, we just wanted a rather plain, functional (to meet the needs of our grown adult children plus spouses) home" 

Classic difficult client line.

If it's easy and simple you could do it yourself right? But it's not which is why you didn't.

A vacation home for us (2) our adult children and spouses (4). So at least 3 if not up to 5 beds 3 baths. "Addition of 2 stories" above an existing single-story I take it too? There is a lot more to juggle there than you know.  A good architect sees problems and challenges that you do not and they design and account for those challenges. Design is not a matter of just completing a task. Often it takes iterations, and revisions to arrive at a solution that best satisfies a number of constraints, many of which you may not even be aware of. I have found that architects are often good at seeing and addressing issues but don't speak up about those issues they solve.  Making something complex look simple is arguably the hardest design challenge. 

Without knowing where you are it's hard to say how those fees stack up but generally, they do not seem too out of bounds to me, especially if you had to measure and draft an existing building prior to schematic design work. 

Your best course of action is to explain your concern to the architect openly and frankly. YOU ARE ON THE SAME TEAM, nobody wins if the project is designed outside the budget.

The SD phase is typically a small percentage of the overall costs of your project.  If 7k is a problem wait till construction you're going to love it.  Typical fees for the whole design portion of the project tend to total 12% of your overall construction cost. another classic difficult client line: "We need some preliminary design to figure out if we can afford to build this".  Most people do a little math using hard costs like 200/SF they heard from their local construction adjacent friend or real estate agent.  they never a factor in the soft costs of design, engineering, and permitting. Then as those costs have to get paid upfront they see it as a loss and taking away from what they will eventually have to spend on hard costs. Twisted stomachs over a few K on a multiple hundred K project. But then they thought nothing of turning over 6% to real estate agents when they sell or when they bought the place.

Jul 22, 21 6:46 pm  · 
4  · 
joseffischer

change our contracted scope, lower initial fee but required to use us for the sale, then we all get realtors licenses and make buck for the life of the building

Jul 22, 21 7:55 pm  · 
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tduds

"Design is not a matter of just completing a task. Often it takes iterations, and revisions to arrive at a solution that best satisfies a number of constraints, many of which you may not even be aware of." 

This cannot be emphasized enough. Clients see the successful scheme (or 2) that we show them, not the 40 failed attempts in the trash. Those take time. You're not paying a drafter, you're paying a problem solver.

Jul 23, 21 11:53 am  · 
1  · 

Somebody should post a link to that guy on Craigslist who does plans for $0.07/ sq.ft.

Jul 22, 21 8:06 pm  · 
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JGGreene

Thank you for the helpful comments. A few questions were asked so I'll fill in some info:

The project is in rural PA. The existing structure is two stories. No site survey was necessary. We provided both a recent survey and the blueprints for the existing structure. The square footage of the new addition would be 1700 square feet. The existing structure was built in 1975 and has been well maintained.

I appreciate the "insider"  knowledge that I lack and am not trying to be a difficult client. Thanks for helping me understand the complexities of your business a little better.

Jul 22, 21 10:35 pm  · 
6  · 
rcz1001

Fee from client perspective? You got to be kidding. From their perspective, it's everything for free is what they ideally want. Pay nothing and get everything they want.

F--- that.

You don't want the clients that aren't willing to pay you what you are willing to accept for the scope of work. Negotiate on scope not how much you're going to be paid for a given scope. Different scope commensurate but not lower pay rate than you are willing to accept. If that means they are turned away, good. The quicker the better. That way, you and them are not wasting each others' time.

Jul 23, 21 1:17 am  · 
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rcz1001

This is not in response to JGGreene. I haven't read the person's posts at time of writing. More in response to the topic thread's original poster.

Jul 23, 21 2:18 am  · 
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With the info the OP has provided the fees seem to be correct. 

Jul 23, 21 11:48 am  · 
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