Pricing
There are two popular points of discussion when it comes to pricing. The following are notes to help you with both.
Professional Services
Pricing is the final page in this series because we needed to explain what’s included in professional services through the process and performance pages. We also needed to explain how the scope of work is developed on the program page.
We use the scope of work to estimate hours for each phase of the design. We make some assumptions about the cost for consultants (like those mentioned on the process page). Taken together, that’s the fee for professional services.
It’s a relatively transparent process because the hours are assigned by phase. For example, in the schematic design phase you’ll typically see an initial meeting followed by work followed by a subsequent meeting and so on.
Our estimates for professional services include the first four project phases: pre-design, design, bidding and construction. We typically don’t include maintenance in the estimate.
Having a total estimated number for professional services allows us to track that number against the total project budget. Our goal is to add more value to the project than it costs to buy the professional services. That’s accomplished through good design, coordination of details and communication among the project team members - especially during bidding and construction.
Construction Cost + Schedule
We like working with contractors and strive to help them support their subcontractors and vendors. It’s our preference to have a contractor involved early in the design phase to complete preliminary pricing and offer guidance.
Preliminary pricing should be assembled at the end of the schematic design phase when we’ve identified the quantity of the work. This “ballpark pricing” gives us guidance about how to move through the remaining design phases toward the bid documents.
Bidding is the second round of pricing where we communicate the scope of work to the contractor in much more detail. This allows the contractor, subcontractors and vendors to provide more accurate pricing and schedule than the preliminary pricing.
There are two common options for bidding: 1) a negotiated bid in which we work with one contractor to develop a price, or 2) a competitive bid in which we work with multiple contractors and each submits her/his own bid in competition against the other bidding contractors.
A negotiated bid can be an attractive option when a contractor’s estimate for cost and schedule are within the your expectations. A competitive bid is much more work to administer and the lowest bidder isn’t always the winning bid.
In Conclusion
Setting the budget is one of your key responsibilities. We’ll be happy to speak with you about starting that process and sticking to it along the way using tools like your program.
Thanks for learning about pricing.
This is the final page in this series.
Please contact us with additional questions or to speak about your project.
We look forward to being in touch with you!
This is the final page in a series of four pages: