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Re: solo eng. fees cont.

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Andrew:

I think Rich's point was that what you SHOULD do and what you AGREED to do
are two different things.  He was pointing out that apparently you AGREED
to do those jobs on an hourly basis, so it is not "appropriate" to then
kind of switch to a minimum lump sum that results in a fee that may be
larger than the actual hours times your quoted hourly fee.  May be you
SHOULD have done it with a lump sum or hourly with a minimum lump sum fee,
but you did not.

So, to me, I think the point is that for those projects that you completed
and has already agreed to a billing method/fee, you should stick to that.
So, if you AGREED to do it hourly (either by verbal or written contract),
then you should charge for the hours you actually worked.  If that happens
to be too small for the potential risk, etc, then learn from it and adjust
properly on the next job (i.e. do it as lump sum or hourly with a minimal
lump sum or maybe increase your hourly rate).

Regard,

Scott
Adrian, MI


On Wed, 15 Dec 2004, akester wrote:

> Richard/listees:
>
> You think a better way of doing it is a minimium lump sum based on the expected amount of work and liability, and hourly if it exceeds that amount?
>
> That seems fair and I guess that is what I was getting at. I haven't really written an hourly contract yet, I just did a couple verbals and they ask what my hourly rate is and I tell them, but they did not ask for an estimate of hours or a total fee. Nor did I punch a clock or really keep track, but I had a general idea for each job. They said they really need to know only for corporate reasons, like to have a record to compare or for accounting. My bill did not give them an amount of hours or itemization, just a lump sum. This included office and printing costs, travel costs, site visit, and my actual design time....
>
> I guess my overall thinking is this: if I spend 2 hours x 5 details= 10 hours, OR I do one detail that takes 10 hours, they should NOT be billed equally. Those 5 details cover 5 different situations or connections that have a lot more exposure and risk compared to one situation that took more time. Also, if I am designing a huge girder connection versus a light gage canopy, to me that deserves a higher fee because it is more difficult, more specialized, and contains more liability risks.
>
>  Also, honestly, it depends on the client and type of construction. The fee I charged for the fixes might be the same fee expected for a small residential house, even though the time of the house may be quite a bit more. Commercial fees are going to be higher and the clients will be more willing to pay the higher fees. I think the risk is higher and the level of knowledge required for codes, design, etc is higher for commercial then residential (otherwise architects, designers, etc could not do residential, or use prescriptive design). To me this is knowing the market, and I see nothing unethical about it. Maybe I am way off??
>
> Next time I think I will set it up as a lump sum plus hourly to cover any unforseen stuff. This way I make profit and cover myself for liability risks, and the client gets a fair and expected fee. My fees on these two jobs have been way under what my old company would have charged,  who passed on the work to me, and I have heard no complaints (yet) from the clients whom I hope to get repeat work from. So I don't feel bad nor do I feel my fee was at all unreasonable, perhaps a bit low but I am new and trying to establish myself with these people.
>
> I am very new and green to all this, so I am learning, and trying to do so fast. I just try to be as fair as possible...
>
> You are right, I was mixing apples and oranges a little. I appreciate everyone's comments and opinions.
>
>
> Andrew Kester, PE
>

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