March 3, 2011
This class focused on alternative compensation methods. Hourly is used when scope is unclear or to cover travel time. Most clients won’t agree to hourly, they prefer fixed fee rates. Hourly is useful when you suspect the client will have a hard time making decisions.
Fixed-fees, also known as a flat fee or lump sum, require a solid estimation. This is not for the inexperienced as this requires a clearly defined scope. This could be used in residential or commercial.
Square Foot requires extensive knowledge or project type. This also requires a clearly defined scope and is more common in commercial than residential. Value-based is when the designer has to convince the client of the value. Most clients will think that all designers are the same. Specialist designers can demand higher fees, as well as signature designers.
Percentage of cost is a fee based on percentage of merchandise and installation costs. This is similar to an architect’s percentage of construction costs. This might tempt designers to use more costly products. There is also a cost plus percentage markup, which is primarily in residential designers. This is when the client pays for the merchandise plus a percentage markup. The markup costs cover design fees but the client ends up paying less than retail.
Next comes retail or a consultation with a designer. Retail is used less often today than in the past, and this is used when a retail store or showroom is in place. This allows the clients to “shop around.” Consultations are used for very small-scale projects. The designer will provide advice, not services. This is followed with a flat-fee for a small number of hours.
During all of this one should consider the IIDA Code of Ethics
Preamble
Responsibility to the public
Responsibility to the client
Responsibility to other interior designers & colleagues
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