Fees and resourcing on design and construction projects

2017-05-01T09:43:05Z

Alasdair89:

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= Calculation =

Fees can have impact on client's perception of a company and so it is important to get them right.

They can be based on:

* Empirical data: practice records of previous costs.
* Calculating the cost of the resource and other requirements (renders,printing, travel etc…) of the project on stage by stage basis.
* Both
* A tool such as the [https://www.architecture.com/RIBAMembership/LoginToMembers-onlyArea/FeesToolkit/FeesToolkit.aspx RIBA fee calculator] based on the cost of the resource and other requirements.

= Types of fee =

Fees calculated as a percentage of the final construction cost:

* Suits straightforward building projects of relatively short duration.
* Can appear to reward design consultants for an overpriced design.
* Risk to the consultants that the construction cost could be lower than anticipated.
* Can be used as a basis for fee calculation rather than a 'set in stone' agreement.

Lump sum fees:

* Appropriate when the scope of the project/ required services/ programme and cost clearly defined from outset and are unlikely to change.
* It is possible to agree lump sum separately for each work stage.
* Variations may allow additional fees.

Time charges:

* Appropriate when resources or time scale cannot be predicted accurately. This is often the case in the early stages of a project.
* An agreed hourly rate per staff category / named individual.
* May include a provision for increases with inflation (12 monthly).

Additional fees:

* Standard appointments generally have provision for additional fees.
* Beware of bespoke appointments that limit additional fees to client instructions.
* Licence fees for the design if the developer uses it on other sites.

= Risks and uncertainties =

* Client experience/ knowledge/ reputation/relationship. It may be appropriate to carry out a credit check and speak to other firms to find out how quickly they pay/ whether they observe payment terms and so on.
* Project definition: Are the requirements clear or uncertain?
* Scale of project: Impacts planning timescales/ resource/ programme.
* Complexity of the project.
* Whether similar work has been done before.
* Programme: scale/ planning/ resource/ uncertainties such as repairs for survey/squatters.
* Other resource requirements: if a project is overseas, it may be appropriate to work with a local consultant to benefit from their knowledge.
* Local opposition/support
* Requirement to appoint sub-consultants

= Key influences on resource requirements =

* Type of procurement and scope of services.
* Speed
* Quality
* Project size
* Complexity
* Extent of works to existing buildings
* Repair / conservation of historic buildings
* Degree of design repetition
* Practice size and overheads
* Geographic proximity
* BIM

= Benefits =

* Business expansion.
* Enhanced profit.
* Employ existing staff
* New market/sector
* Quality of work
* Prestige/enhanced reputation

= Key influences on brand value =

* Practice reputation.
* Location.
* Culture.
* Specialist skills.

= Context/Benchmarking =

Whilst using the points above to aid a resource-based approach to calculate feed, cross-checks are recommended to ensure that a sensible outcome has been reached. Such checks include comparing the fee to be proposed against previous similar jobs and benchmarking the proposed fee against other projects when expressed as a percentage of construction cost.

= Find out more =

=== Related articles on Designing Buildings Wiki ===

* Appointing consultants.
* Architects fees.
* Consultant team.
* Design team.
* Fees.
* Letter of appointment.
* Planning fees.
* Schedule of services.
* Winning work.

[[Category:Articles_needing_more_work]] [[Category:Cost_/_business_planning]]

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Fees and resourcing on design and construction projects