It’s not uncommon to have owners want to save by cutting down on the professional fees from architects and designers. However, in my 40+ years of construction experience, I have not seen this work out.
What seems costly up front, often pales in comparison to trying to do things on your own.
Building or renovating a home entails thousands of hours of labor, countless decisions, and the
interdependence/cooperation of hundreds of trade professionals. If you don’t think such complexity is possible in residential construction, we can show you the data.
Where this costly mistake often begins is right after the start of construction. Here there is usually a lull in activity for the design team and a lot of design fees have been paid but the cost of construction has yet to materialize. This seems like a natural transition point from the design team to the contractor – but this isn’t so.
There are three primary cost accelerators/pitfalls for most client-designed projects that we experience:
1. Schedule Delays
2. Purchasing Risks
3. Poor Match of Skillsets
Pitfall #1 Schedule Delays
Any builder can provide a list of materials/finishes that require a decision and/or
incorporate the decision milestones into the build schedule; so, what can possibly go wrong? A lot. Interior layouts, exterior elements, finishes, flooring, art - all design features require significant consideration during the early construction phases of the home.
Further, how one material or selection works with another in a holistic manner takes a lot of
preparation. Yet we find time and again, that client-designed projects undergo multiple rounds of design. The costs of the delay are not just a month here or there or buying new tile or paint. What drives up the costs are general conditions and rework. Every project has a burn rate of cash to keep the job moving. This is referred to as ‘general conditions’ and accounts for cost items such as:
Site protection
Dumpster
Toilet
Site office
Insurance(s)
Use fees
Utilities
Project/Construction Management
These costs are critical to a successful project and are usually small in terms of the percentage of the overall cost of construction. But when ‘general conditions’ are running at $20k+ a month on a large job and there is an addition of time to the schedule – then general conditions add up fast. Schedule delays also cause expensive rework. Sometimes it makes sense to shut down a project and wait for decisions and other times there are other areas of the project that can be progressed. Regardless, a schedule delay of most any sort causes project tasks to move out of sequence. This is where damage can occur if steps are not taken to protect work product or items are simply replaced.
This is not to say that delays only occur on client-designed projects. Delays are a continual challenge for even the best run projects but minimizing the probability of delays by relying on professional design partners is a key element in shortening an already very long, and fragmented supply chain.
Pitfall #2 Purchasing Risks
This is one of the more frustrating cost drivers on client-designed projects and has an immediate impact on both the client’s cash position and their mental wellbeing.
The internet has been the great equalizer over the past 30 years for our industry. Some believe the access to information and products has commodified design. Others believe it has opened a world of possibilities. Regardless of your position, the internet has driven much needed transparency across the building space. Anyone can check to see if they are getting a fair price on materials using their cell phone which is great! But this can also cause many unforeseen issues. On almost every project in my career, we have used/installed client purchased items. This usually is not a problem, until there is a problem.
Often, the best internet deals result in costly, protracted problems. This occurs most often with plumbing fixtures. A client buys a great faucet at an unbelievable price online. However when the
plumber goes to install the faucet we discover the faucet is missing a part, or has a damaged valve – something small. Unfortunately, the only way to remedy the situation is to send the item back and order a new part(s) – which must be done by the client – not the plumber.
Another pinch point is when clients order materials direct and others only do the install. This is a great way to save a few percentage points but we often see material shortages, mixed color lots, or broken items upon delivery. Except for appliances, the total cost of the finished product is almost always greater when working with owner supplied materials.
Pitfall #3 Poor Match of Skillsets. Experience, Knowledge and Connections
Our clients have busy lives and demanding workloads. They rely on their financial experts for portfolio advice, they consult physicians for health concerns and seek counsel for legal matters.
A good design professional will cost anywhere from $120 to $300+/hr and they will often purchase the materials for their scope of work. They will source, purchase and control the item until the trade professional completes the install – all accomplished in a holistic manner.
Our clientele often have workloads with an opportunity cost well in excess of hundreds of dollars/hour. Couple this with the fact that client driven design research is often 3 to 5 times less efficient and can result in other purchasing risks – does it make economic sense NOT use a design professional?
Projects are delivered with greater certainty when clients collaborate with design professionals to tackle the minutiae of design management and serve as another set of eyes on the construction process. This holds true, even on projects where the clients are involved heavily in the detailed design and even construction of their home. Architects and Designers often have special trade teams on the other side that help them navigate and solve issues quickly. They also have experience, knowledge and connections to alternative ideas that could result in savings that pay for themselves.
In Summary
In almost all other areas of our economy: finance, government, medicine, philanthropy, law,
manufacturing, engineering, etc., complex projects are almost never tackled by a single individual. Building a custom home or embarking on a large scale renovation should be no different. Collaborating with a team of both design and construction professionals that you trust and who are collectively dedicated to you and your project is critical to the success of your project, while minimizing the total impact on your budget and psychological well-being.
What seems costly up front, often pales in comparison to trying to do things on your own.