5 steps to charging Professional Fees
Lately I have been busy and unable to publish blog posts. I was preparing architectural drawings for a couple of residential projects. However, in the course of work I was pondering on how difficult it is charging professional fees.
Trends in Architectural fee handling by clients.
Something struck me when I spoke with a clients about the architect’s professional fees. It was either these clients:
- already had a fee in mind they were willing to pay
- they were prepared to negotiate my offer and were shocked at how much what they proposed was not seen as equivalent to the architectural service being rendered.
This makes me wonder – ‘if this is the new fee trajectory for the profession?’
If this trend is most likely to strangulate quality architectural practice?’
I have recently observed that this not only a problem of architects. Even designers, engineers, quantity surveyors, accountants and everyone charging professional fees out there.
This is a concern because a consulting professional needs to be well remunerated. It is motivation to work. It also provides him the enablement to involve the best human and material resources on that project.
It’s standard practice as architects to first receive the briefs and survey plans from a client. Later analyse, research and sometimes make sketches before discussing with your client the feasibility of his brief, possible proposals, design timeline and project cost.
It’s at this stage you chip in the fees for your professional services. As well as that of other allied professionals required to work along side you to successfully deliver the project.
Professional fees are designed to guide and control the rates charged by professionals.
They are normally prepared by professional bodies for its members and prospective clients including the government. These fees may or may not be backed by law.
Basic way to calculate architectural fees
Professional fees among built environment professionals in Nigeria can be calculated. Either by man hour rates or by a sliding scale percentage of the estimated total cost of construction.
For example, the professional fee for the architectural design of a 3 bedroom bungalow whose estimated total cost of construction is 5million naira will be calculated to be 4.75% of that cost totalling N237,500 (naira).
Often times in practice it is near impossible to request for full professional fee except from government and a few multinational companies.
You may think it is the fault of the professional or his inability to bargain or stand his ground or his lack of professionalism.
It isn’t and infact this is the new reality fast driving small and growing firms aground.
This strangulates them of proper finances to grow, get proper structure, expand and transcend generations.
Of course besides poor fees many other factors can impede the growth of a business:
- poor financial management
- poor customer relations.
However, strangulating revenue inflow is like constantly giving a person the quantity of food that is not commiserate to his age.
It won’t be long before he gets emaciated, malnourished and die.
This is the present situation of a lot of architects. Client are most bold today to negotiate your fees than ever before.
God saves you if he is more eloquent and charismatic than you or if he has a specially trained apparatus within his organization that handles negotiations.
You will be defeated in the negotiation battle.
Using Nigeria as an example, if you have been following the news you will know that the country was in recession between 2016-2017.
High inflation and naira depreciation rate raised the cost of running offices and daily cost of living.
You may also know that the interest rate on bank loans in Nigeria are quite high. Which has made taking loans to cushion erratic and meager revenue from clients unwise. It will push your small firm out of profitability.
What can be done to manage this situation?
At least outlining the problems will raise the consciousness of architects to this trend and its effect on quality architectural practice.
Some suggested solutions to this problem are:
Constant review of the Architects’ fees
The first solution is to change with time by checking to see how realistic this professional fees are. Are they too high and have become unrealistic for the generality of people in this clime?’ or ‘are they too low?’
We really need to know if these fees are still appropriate today based on current economic challenges faced by most people especially potential clients?
Also can we have different professional fees for different client type; private clients, governments and corporate bodies?
Professional bodies should create awareness and disseminate information
The second solution is for the professional bodies from where these fees originated to take up the responsible of creating awareness within and outside the industry.
We need to justify the reason for such payment. Especially since architectural services and the role of the architect is mostly poorly understood. They are largely unappreciated by most prospective clients.
Unity among architects
The third solution is for all architects to work in unison only then will they be able to push forward in one voice one fee.
For example if all architects charge the same fees, it will be taken that architectural fees are standard and non-negotiable.
Fight against quackery
The fourth solution is for architects to stand up against quackery and fight it to its logical conclusion.
If this isn’t done it will sustain the illegal market where architectural services can be bought for next to nothing.
Professional bodies should absorb all Licensable persons
The fifth solution is for the professional bodies to find a way of absorbing every licensable persons with a background or verifiable experience in architecture.
This is to grow its army to fight this menace, reduce the number of people practicing architecture illegally. As well as welcome into its fold more people who can then be disciplined when they err.
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