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RE: Catch-22 Software Cost

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I'd probably bill the next 3-4 jobs in a way to pay for the software.

Job A:
With software the fee would be say $5k
W/o software the fee would be say $9k.

I'd probably bill $7k.  They get a $2k savings and you pay for part of the software.

John C. Jones, PE
Barnett Associates
Pell City, AL
205-884-5334
205-884-0099 (fax)


-----Original Message-----
From: Rich Lewis [mailto:sea(--nospam--at)lewisengineering.com]
Sent: Friday, December 10, 2004 7:37 AM
To: seaint(--nospam--at)seaint.org
Subject: Catch-22 Software Cost


I would like to know if anyone charges for the use of software in their
design.

Let me explain a particular situation.  I am a small, one-man firm, that
is getting established.  I am working on the design of a special
foundation.  The project is an hourly fee plus expenses.  I don't have a
choice on that right now.  I could do this design with the limited
software I have and by hand calculations, but it would be much more
efficient if I bought some special foundation software and designed it
with that.  The dilemma is that since this is an hourly fee the software
that helps me be more productive actually reduces my fee.  On top of
that I still have to put out for the software.  That's what I think is
the Catch-22.  If I become more productive by making a capital
investment then I reduce my fee, hence making my capital improvement
harder to pay for.  

Now you could say that I still have the software to use on future
projects.  That's true, but future projects are again cut short fee wise
due to the increased productivity.  That means I need a lot more
projects to recoup the cost.  That also assumes I will have the kind of
projects that will need this software.

I was thinking about charging a "use" fee on the software to help recoup
some of the cost.  Is this commonly done by others?

If you are tempted to change this thread into an argument of "for or
against" hourly fees I ask that you start another thread because I would
like this one to address the issue of capital improvements and recouping
costs and not get sidetracked.

Thanks.


-------------
Richard Lewis
Lewis Engineering
 



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