I entered the profession in 1993 after graduating from Roger Williams University. The day I walked through studio for the first time, I heard the stories of a struggling profession; a culture built upon the belief that architects were artists and money was for those who sell out to the masses. That story is alive and thriving in today’s profession as well.
Independent Architects Must Lead the Charge
We have many problems with our profession and that story we architects are perpetuating is one of the most painful. Solving this problem is not going to be the result of our professional organization making promises for change. Our schools will be slow to evolve. Nor will the solutions will be found within the halls of academia any time soon.
I believe the solution to our profession’s problems will be found with independent architects. You and I must take a stand. We must lead the charge. We must commit to making change in our own studios. Shift paradigms. Create collaborative cultures and build better businesses.
Build a Better Business
Entrepreneur Architect was launched to inspire architects to build better businesses. If you’ve been reading this blog for any amount of time you know our mission, as a community, is to become an influential force. When architects focus on building healthy profitable businesses, things will change. Can our profession be saved? It is up to you.
Write a business plan. Develop a marketing strategy. Learn to sell your services. Build a business that thrives, with systems to allow you to create the architecture that makes the world more beautiful and improves the lives of your clients. Focus on profit, then art.
Pursue Debt Zero
The first step in building a strong healthy business is to pursue debt zero. Despite what our banks try to sell us, debt is not the solution for success. Our society is addicted to debt. Impatience and misguided ambition has lead us to a dead end of credit cards and lines of credit.
Borrowing money holds you captive. Grow slow. Save your money and earn your way to success.
Raise Your Fees
The second step to success is to raise your fees. The independent architect will lead the revolution. When we each begin to push our rates up, the value of our services will increase in the mind of our clients. The fees we earn are the fees we set.
Share What You Know
Have you built a better business? Open your doors and share what you know with fellow architects. The more we share, the more the profession will benefit. When changes in the profession begin to occur, we will all benefit. We’ll all make more money, we’ll all build better businesses and we’ll all create better architecture.
Can our profession be saved? It is up to you.
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Copyright: alphaspirit / 123RF Stock Photo
Mark, I agree completely, but I often feel like Don Quixote charging the windmills. Most who state architects are too much about art and not enough business are usually willing to forgo the art (or at best put on some lipstick). I believe if we can solve the one big (or more) issue that worries the client, the art will come and be welcomed. Somehow we need to do both. We need to be confident in our own uniqueness. It’s a rare thing – an perhaps a fleeting thing. Thanks for your efforts to lead the charge.
Mark, I agree with much of what you have written here.
However, I’m just not sure about the following…..”When we each begin to push our rates up, the value of our services will increase in the mind of our clients.”
I think it could be said more like this: When the value of our services increases in the minds of our clients, we can push up our rates.
And I think there needs to be a collective effort. There need to be resources readily available to small firm architects the convey why working with a licensed architect is a better process than working with a builder (and their draftsperson) a lumber yard, a novice designer, etc.
Many people I meet will go to a builder first, and have more confidence in him/her than an architect. How do we change this false perception? How did we/architects get there? As can be seen by Hanley-Woods home design service video, Many are under the perception that architects are: expensive, time consuming, and (sadly some truth in this) prima donnas who are only interested in creating THEIR vision.
We need an emphasis on the value of the process/services of working with a licensed architect.
Mark;
Good article. I began working for myself in 2010 and have never taken a loan from a bank. I believe you should invest your own money into your endeavors. The payback will be all yours when it comes. As for fees, when I first started the economy was so bad I’m ashamed to say I gave away too much work. Now my fees are realistic and things seem to be coming back. I don’t, however think it’s going to be a collective that works together for better fees.
To be very clear and to the point, we need to stop “dumping” our services.
I’ll be further clear what I mean by dumping, I’m borrowing a term from giving away goods at way below what it costs in a given market.
Either, we outlaw these acts when it comes to services (and enforce it) – applied to all who offers design services of any kind. I don’t care if the person is licensed or not.
Our other option is that we “self-police” ourselves. Sadly, ethics in the United States doesn’t exist so we need to outlaw price dumping and apply it to everyone not just licensed.
This is one kind of regulation that we must have and enforce but the challenge has been in how to enforce it and be fair. Since it is mostly labor… that can be a challenge. This can also imply outlawing the practice of subsidizing the cost of providing a service through other services or goods provided for in the same or other business ventures (or other means) to allow for pricing below market value. How to enforce it needs to be adequately figured out, though.
Self-policing is the most easiest to achieve but it requires a common ethics and moral compass and values. That is the part that is hard when people don’t all operate and march to the same tune (ie. Currently, we don’t have a solid consensus of values).
What we need to do is charge what it would cost to render service plus a profit. We can’t set terms about what the costs are. When people have multiple ventures with some that have very high contribution margin, they can subsidize the ventures with low contribution margins with those with higher contribution margins to reach the income and lifestyle they are content with and compete in a price war.
The goal in the price war is to shake out competitors (ie. competitors goes out of business and go away into other fields). The problem is so many just suck around instead of going to other careers. Keeping the supply high to the available demand ratio.
We are probably all guilty as charge and it isn’t necessarily a right or wrong but that it is the apparent nature of the profession and there isn’t other options for most of us that won’t cost an arm and a leg to go into because U.S. has effectively narrowed a lot of our choices we used to have and those options are now foreign with zero domestic in those options. We haven’t sufficiently replaced those options because for so many options we have had, we automate it with computers leaving less job opportunities that anyone would do than there are people. There just not enough jobs being offered to employ the entire workforce.
Leaving so many with no options.
One thing we need to do is stop cutting our own throats. Stop fighting with ourselves as professionals.
I am really glad you guys are actively discussing key issues. I am not very good at keeping up or commenting but a few key points to echo some others.
-I have been contacted by a large american firm in recent months looking to do work in Toronto’s housing and condos market. They have many US offices and outsource all the the CAD in India. Outsourcing is not legal for architects here but they are based in Dallas TX and have just scooped a huge number of projects based on “innovative project delivery”. Clients love the savings and market rates for architectural services decline.
-I have been contacted by 3 CAD services companies in the last 3 weeks. 1 in Romania, 1 in China, 1 in Florida with staff in Spain. They offer rates of $14US, $12US and $10US per hour. Between them they are servicing 17 firms in Ontario listed in their marketing brochures. Again illegal yet common practice. How can I compete? I can’t pay someone local $14US/hr. Even the clients who value my services get upset when other architects offer cheaper rates part way through a project. It happens on every project. Vultures are constantly trying to steal my clients.
Self-policing has not worked here and in fact has contributed the the decline in fees by legalizing moonlighting, part time weekend practice and stepping back from any technical role and promoting the “art” of architecture. Credential inflation continues here at a rapid pace and the “architecture police” have decided to spend surpluses on legacy projects that are expensive, have no value, and promote architects as self indulgent and out of touch. If anything is left up to the diluted ‘profession’ to solve we are doomed to end up like web designers,…pretty much extinct. I think architecture needs to be regulated by others because self-regulation transforms the profession to a vocation for architecture enthusiasts.
I am in total agreement that compensation for architects should increase. However, raising one’s income does not have to be tied to “raising your rates (fees),” which may be counterproductive in the short term. Just raising your hourly rate from $150/hour, say, to $200/hour just exacerbates the situation. There are a number of alternatives:
1) Look at “value pricing,” taking time out of the equation. (Fixed fee or per/sq. ft. pricing.) Then look at increasing your efficiency. Being able to do the same task in one-third less time equates to a raise of 50% of an imaginary hourly rate if you haven’t given it all away by hourly billing. (1 hour @ $120/hr = $2/min.; 40 min. @ $120 fixed price = $3/min., a raise of $1/min. or 50%)
2) Unbundle services and create new profit centers. Offer kitchen design, or lighting design, or landscape design, or interior design as a separate package. (Might need to get a little education.) Or enumerate these explicitly in your fee so the client understands why your fee is higher than an unlicensed drafting/design service.
3) Offer to provide products for a markup like interior designers do, splitting your trade discount with the client. Both you and the client win. For example, split a 20% discount on a $10K oriental rug with the client. You make an extra $1000 just for placing the order — AND have some aesthetic input into the product selection.
Great article Mark. I’ve always been a big fan following your blog. Thanks for difference you are making in our profession. One way to make more money in our profession, if you are an independent architect, is to dive into design-build and assume the role of “master builder”. I was doing fine as a registered architect after 30 years but still felt that I was not reeling in enough money. I turned to architect led design-build last year. Yes, it is a bold move but pragmatic for me because it made sense to assume the role of master builder based on historical precedence; nonetheless, it is well remunerated. It also helped my architectural practice charge higher fees because my clients gleefully favor the idea of the architect being the builder to reduce their worries & eliminate the finger-pointing during construction. I honestly believe that it is a route that architects should consider. It has made a big difference in my business and personal life.
Glad to hear you are profitable personally Roland. Not many take the road you took because lack of knowledge or ability. Maybe you should blog on it if you have time.
Caution, discussion or recommended fee strategies is a slippery slope. While is seems unfair the the NAHB should be able to create builder groups that open there books and practices to each other, that is not my understanding to be the case with us as architects. This may be worth reading http://www.transformingarchitecture.com/myth-2-architects-cant-talk-about-fees/
Peace,
Dave
Thanks for the link David. Its always interesting to read another architect’s take on the fear of discussing fees. I have done the research as well and it is my understanding that as long as we are not setting fees or creating an environment where collusion may occur, we are permitted to discuss the subject. I believe this fear of discussing fees is the number one reason the profession finds itself in its current state of affairs.
I am planning on discussing this topic with an expert on the podcast to review the anti-trust laws and help us all understand fact from fiction.
AIA has set limits that are beneficial to protecting the organization, but are most certainly detrimental to the individual architect. Stay tuned.
Thanks as always…
Since small architectural firm are 87% of the profession, we need to be collective and focus on our issues. As we know most of our technical ability and the most important to our professional development that supports us monetarily.
Has academia really prepared small firm architects and others? Our profession is being subdivided to the point as one said at the Buildings XI conference if architecture does not change we are going to be relegated to box of crayons and sketch paper. Future architects need more options during academia after 2 years of design.
We should collectively support academia change, highlight and support politically the universities that are developing small firm architects. The large firm option is always there.
I follow Architects in the UK, one discussion they have is over is called ‘PROTECTION OF TITLE’. Our UK brothers are in bad shape- the little players are getting stomped worse than we are. One UK writer said that with without the services of Structural + MEP PE’s, we really are just glorified designers whether you have a state reg number or not. It has taken me years to realize there is some truth to this pessimistic statement. It is also why it is hard to raise fees. It would help if more cared about Green issues, but that focus doesn’t sell enough Frisbees to the public. The top players in our business are well-compensated. The rest of us must recognize that the opposite of PROTECTION OF TITLE is just another phrase for RENT SEEKING. If you are a small player, they only way to make much money is to become a builder too. Or be an incredible salesman of your services, which may or may not exceed what builders or package deal folks offer . Any discussion of the last 2 subjects is valid. The rest is up to legislatures everywhere, of which AIA has insufficient leverage. So I humbly close with the suggestion that some of us need to accept reality and operate as best as you can within it.
Great discussion. This is something we talk about at work almost daily.
I am concern for anybody in our profession that is waiting for things to return to the way they were.
The wait is only wasting more of the few precious years we have in this profession. We have to make change now without delay and it must start with finding ways to sell our services in way we never imagined. We plan , we visualize, we facilitate. We find solutions, save time and find efficiencies all while creating beauty. Sounds valuable to me. The only problem is don’t expect that somebody will want it in the same old way.
I would to collaborate and I do understand that architects can benefit from working together.
David (et al.),
My big concern is that architects are so close to the process, that they don’t know how to sell benefits (which seem obvious to them), but only “features.” Planning, visualization, facilitation, finding solutions, etc. are all just nice words that have no obvious value to an Owner. These are just “nice to have” intangibles. Start saying that “we often have been able to shorten the construction schedule by 20%” or that “our documents are so tight that we seldom see non-requested change orders increasing the contract cost by more than 4%”, and Owners can see value in an architect’s services. Saving time, saving money, saving headaches, AND getting a spectacular project to boot (i.e. increasing resale value); these are all things that can have value to an Owner. Trying to sell “good design” per se, which has value only to a few of enlightened clients, is a very risky concept to hang one’s professional self image on. I would like to see architects start talking like they understand what’s really important to clients, rather than what’s important to themselves.
Interestingly, I have a book called “Plan Your House to Suit Yourself,” written by an architect, Tyler Stewart Rogers, in 1938. (over 75 years ago.) In it he rails against the common bypassing of the architect to go with contractor designs and “amateur experts,” and attempts to sell the reader on the fact that an architect is an expert in construction methods and is there to protect the Owner’s interests, and that good design just will be a given. I like his attitude, but some things never change…
Hi Mark,
You wrote:
“….The day I walked through studio for the first time, I heard the stories of a struggling profession; a culture built upon the belief that architects were artists and money was for those who sell out to the masses. …”
The missing link is that most of us don’t (want to) work for the MASSES, that CRITICAL MASS, in preference to the OPULENT. The challenges involved in creating a “work of art” – without a budget limitation is not as challenging as trying to excite or satisfy a tasty client with a low(er) budget.
Will I be wrong if I posit that THE PARENTO 80/20 PRINCIPLE DOES NOT STRICTLY AND EFFECTIVELY HOLD SWAY IN OUR PROFESSION, IF ONE SEEKS REAL IMPACT?
Great article Mark
Shift paradigms. Create collaborative cultures and build better businesses. This will be change our world sir first of all we should inform this article at our schools. If only we could shift paradigms Dr A.P.J Abdul kalam said that Primary education needs to be approached more creatively where dedicated teachers nurture young children who can prepare themselves for the challenges of the future, he said at the seminar titled “Evolution of the Unique.” I think sir we will see paradigms through our Our schools …..