[saslandscape]

I have a dilemma I'm trying to figure out. So far I've been design only (only drawing designs) but you can barely make a living doing that. What I would really like to do is get involved with the project and offer to be a project manager.

I've always been told that project managers should expect to get at least 10%, but the landscape contractor I plan on using to install my clients' designs, doesn't think the market will take that high of a percentage. So what do you do? How do you subcontract? Does the landscape contractor offer a lower estimate than he would give to his own clients to absorb your fee? He does need a project manager for his projects as well, but does not want to pay me 10%, just a manager’s fee. Does that sound right to y'all? Just extremely confused- any help would be greatly appreciated. Thanks.

[FungusMudGrub]

You can make a living doing landscape design, if you put in your time and get a good rep, work in the right area, yadda yadda yadda. And we just had a major discussion re PM so please do a search. I know; sounds grouchy. Sorry.

[saslandscape]

Well the market here gripes if the design is over $400, so it's pretty hard to make a living just doing designs unless you do 300 designs a year. It's getting tough to do design only- one person I did a design for, charged them $500 (1 acre landscaped) and I felt like I had robbed their children's college fund.

[tfld]

This is the problem we've got to get over--feeling like what we're doing is not worth the pay.

I would say the definition of landscape designer and project manager are two separate items which could and probably should be addressed in concert with one another. Under landscape designer you may be responsible for initial contact(s), design, preliminary scheduling, budgeting, and bidding. The landscape design element easily bleeds into the project management side where you may be responsible for daily construction scheduling, quality control, contractor selection and qualifying, budgeting, and materials scheduling.

I would say, IMO, 5-15% is fair, varying by the complexity and involvement you may face in the project. It seems to me like this fee could be generalized as a "kickback" from the contractor for hiring them for the job. Each job would have a pre-determined PM fee regardless of the final contract with the installer. Some jobs may net you $50bucks, and some may be more "full-time" and on-going and net more like $2000.

One way you could look at this is to charge less for the upfront design with an agreement perhaps between yourself and the client to read something like,"Landscape and Construction contractors for this project to be selected by SAS Landscape..."

Just some thoughts..

[agla]

The phrase we should be using for this is "contract administration" which is the specific type of project management we are talking about. Even though it has been discussed a bunch of times, it is a vast subject with a lot of points of views and perspectives.

The text book version of contract administration (and I do have at least one text book on the subject) that is part of the standard curicullum of landscape architecture goes like this:

It is the 5th step in a complete design service contract.
1. schematic design
2. design development
3. contract documents
4. bidding and contract negotiations
5. contract administration

Most design/build landscape contractors limit design services to the schematic design with some limited design development whether they have staff designers or hire subs. The reason is that they have their own methods and specifications whether written or not. The reason for specification writing and in depth construction details is for bid packages to make sure everyone is on the same page. It is a great deal of work and expense to do all of that and where the design/build contractor has no interest in the job going out to bid or to have flexibility removed from his ability to finish out the job, he is not going to have you do all that work.

The design/build contractor is also not going to have you produce bid packages as that is not in his best interest.

Contract administration is just that - acting as the administrator FOR THE CLIENT to observe the progress of the work, evaluate materials and workmanship, and resolve conflicts involving interpretations of drawings and specifications*.

If you are working for a specific contractor there is no contract administration role since you are an agent of the contractor rather than the client. This is something that is not well understood by a lot of people if you look at most of the other threads on this subject.

Many designers think they should be able to get 10% because they drew the plan as if it were a commission. I'm all for that, but good luck getting it (anyone in my area that wants to pay me 10% and can give me enough leads to get the job done, send me a PM). Many contractors are shooting for a profit margin of 10% after taking on every other part of the job. I'm not going to wager that if they can get that up to 20%, they will split it with the designer.

The standard method to earn the 10-20% contract administration fee is to get your own clients, go through full design development, write specifications for everything from grass seed to soil to stone to color ranges of stone,...., put together full bid packages, put it out to bid, check out the qualifications including bonding and insurances for all of the bidders, advise the client and make recommendations on who to award the bid to, monitor progress, inspect workmanship and materials, resolve conflicts (draw up adendums and/or approve change orders) and basically assume total responsibilty of the job for the client.

You can't administrate a contract for the client if you are aligned in any way with the contractor. It is a total conflict of interest.

There is no reason for the contractor to pay you to administrate the contract on his behalf. He has himself and his foremen and crew to do that (one of which may be called the project manager for the contractor). It is possible that the contractor's designer is capable of being his project manager as well if (s)he has the supervisory experience to do so. In fact it is not uncommon if the designer has worked extensively in the field in the past because it is pretty difficult for most contractors to supply 40 hours of design work a week for a year 'round designer and they don't want to pay you to do nothing. They may pay bonuses for work that you sell, but I don't think any will fork over 10%.

The hardest thing about contract administration work is that it is limited to large enough projects that the client is willing to pay someone else an additional 10% to essentially take the burden for them. Most are going to handle the contractor directly themselves which you have obviously experienced already. Add to that the fact that these kinds of projects already have an architect doing the same thing who is not about to give the 10% of the landscape up to someone else.

When someone is willing to put out that type of additional money, they usually want to get the best of the best to do it. That makes it hard for someone to work their way up to it. It is much easier to gain your reputation doing this work as a contract administrator as a salaried employee until you are well enough known by architects and developers. Then you make a lateral move instead of climbing a ladder.

It is not easy, to say the least.


*Ready, Set, Practice - Elements of Landscape Architecture Professional Practice by Bruce Sharkey

[Chris Heiler]

I act as Project Manager, or General Contractor, on my larger projects. Not on all projects.

If a project I designed only requires a landscape contractor, I just refer a couple of contractors (I don't get a finders fee).

As far as PM goes, I have a contract between myself and the homeowner.

I put a mark up on my subcontractors of between 12% and 20% depending on the trade. I NEVER ask my contractors to offer a price break for me. I wouldn't recommend doing that. As a side note, you need to understand the difference between "mark up" and "pure profit". For example, if you want to make 15% profit on a project, you need to mark up your subs 17.76% to get that profit.

As far as the market not being able to take this kind of a mark up, that's a bunch of crap. Your client doesn't know what landscaping should cost. They won't even ask you what your mark up % is. I've had ONE client ask me what my mark up is in 5 years.

Also, people will tell you that you won't be able to compete against design/build companies because your prices will be higher. That's crap too. And so what if your prices are higher, good for you!

The key is to understand the benefits/advantages you offer the homeowner as a project manager. You will need to be able to SELL them on these benefits.

Here's what I explain to homeowners when I meet with them and why they should hire me over a design/build company:

1. We are a "Design Driven" company, not a "Sales Driven" company. I like to say that "we don't design around our inventory or the talent of our crews."

2. I explain to them that we get multiple bids from qualified contractors to ensure fair and competitive pricing.

3. I explain how important it is for the designer to oversee the construction. This ensures that the shared vision between designer and client is realized. Also, the homeowner only has one point of contact to communicate with.

4. I explain the importance of having "specialists" for each task. For example, I'll hire a mason for most stone and brick work instead of a landscape contractor. A landscape contractor might be good at everything (plantings, irrigation, paving, etc), but they won't be GREAT at everything.


If you have clients who understand the value of design and the value that you bring as project manager, you should be successful.

Hope that helps. Good luck!!!

[Chris Heiler]

One way you could look at this is to charge less for the upfront design with an agreement perhaps between yourself and the client to read something like,"Landscape and Construction contractors for this project to be selected by SAS Landscape..."

No offense to you Nick, but I wouldn't recommend doing this. NEVER compromise your design fees and try to make it up with the construction.

[saslandscape]

Thank you AGLA! That is quite the book- I'll be sure the buy it. It definitely clarifies some of the frustrations I have. I'm thinking of doing a certain percent based on the amount and complexity of the project- anywhere from 6%-10%, like what tfld was saying. I like your idea, tfld, of charging less for the design in order to project manage it.

On my rant about design only- some people just don't understand how important a landscape design is and how much thought goes into each design. It just gets insulting when I have some people (especially doctors out here) think Landscape Designers should be paid like $10/hr or draw free designs when we're professionals too. This might be why I always dread presenting clients with an invoice for the design.

[saslandscape]

Chris,

Wow- you answered all of my questions! That is exactly what I need to tell clients and I have a couple of landscape contractors I can use to bid the job (won't take a finders fee either). I'm glad to know that it does work and that you can actually get paid to oversee the project, no matter if they tell me the market can't handle it. It's a lot better (and more exciting) to be involved in the project this way, then just handing the design to the client, getting your fee, and never seeing them again.

[Chris Heiler]

I like your idea, tfld, of charging less for the design in order to project manage it.

I'd be careful doing this guys. What happens when the client decides to walk away from the project? What happens if they decide to hire a different contractor? This stuff happens...

Don't comprise your fee

Also, don't set your PM fee too low. I suggest setting 10% pure profit as the lowest you will go. I think that's a mark up of 11.11%. If you set your fee too low, you won't make jack for the amount of time you actually spend on overseeing the project.

[Stonehenge]

I don't really have any to add to the conversation going on, except to suggest to sas to look at general contractor home builders. I know one who's only tool is a cell phone. He farms out everything, and makes 10-15% on every house he builds. He's been doing it for years and is a respected builder. I would find it very hard to believe that if I were to place calls to 5 different landscape firms in your area for a paver driveway and full landscape for a 1/2 acre property, I'd get 5 bids that were within a few hundred dollars of each other. They'd vary by thousands. And every one of those companies is getting work based on those pricing models (or they wouldn't price that way).

There's value in managing or contracting or administrating a project.

[tfld]

Hmm...I don't think I would start talking about SD DD CD CA as a recommended model for unlicensed designers. I think AG is trying to call me out, perhaps as well he should.

[tfld]

Originally Posted by saslandscape

Thank you AGLA! That is quite the book- I'll be sure the buy it. It definitely clarifies some of the frustrations I have. I'm thinking of doing a certain percent based on the amount and complexity of the project- anywhere from 6%-10%, like what tfld was saying. I like your idea, tfld, of charging less for the design in order to project manage it.

On my rant about design only- some people just don't understand how important a landscape design is and how much thought goes into each design. It just gets insulting when I have some people (especially doctors out here) think Landscape Designers should be paid like $10/hr or draw free designs when we're professionals too. This might be why I always dread presenting clients with an invoice for the design.

Not at all pointing any fingers, because I've certainly been in this position, but I think the reason educated clients have a hard time paying fair design fees is because by and large it takes very little if any education to become a landscape designer. Dont stop reading though!!

I understand (because I was/am from the same situation) that to be a good landscape designer you probably have experienced many, if not all aspects of landscape construction, maintenance, and horticulture and have a keen understanding of spatial organization, scale, and site analysis. Now, I think the key is, so long as you have these attributes, to highlight or advertise these skills in some way so as to qualify yourself. Small(ish) scale residential design is a unique organism. Traditional methods of design apply, but the clients most of us are talking about only allow for an abbreviated "SD." Projects requiring much more usually require much more technically as well (far beyond my stand-alone capabilities at the moment). In a lawsuit-crazy society perhaps it's better to keep things simple. I just can't see the homeowner dropping 10% for your supervision when they can barely dig deep enough for that $300. More than that, we're having the wrong conversation..

[agla]

tfld, I'm not calling anyone out (or why you think something is targeted at you) and agree with everything in the above post.

All that I am trying to do is to point out that there are a lot of factors that go into the 10-20% contract administration fee that I don't think everyone realizes. Using Stonehenge's contractor who only has a cell phone as an example, it sounds like all he does is call people up, line up all the subs and walk away with 10%. That guy is most likely a pretty hardnosed character who keeps everyone in line, on time, right materials, good craftsmanship, good management of change orders, .... . He is dealing with subs who, like any of us, will find holes in the contract that present opportunities to upcharge to correct. Many of the subs have very strong personalities and will try to get their way whether it is by arguing that some material or workmanship is acceptable or that "the contract spec's or plans do not say that, so if I'm going to do that it will cost $$" and so on.

Now the cell phone guy has probably got a group of subs together that he has worked with for a while. They know he won't take any nonsense, they get familiar working around each other, they know when they can have a change order and when they have to suck it up, so it makes the cell phone guy's job look pretty easy. In fact it probably has become pretty easy. But, if you don't have the knowledge of construction, some contract law, and the hard nose personality it takes to push these guys when they need it and fend off their assertions that something is an extra or that it is not part of their contract you'll wish you never thought about contract administration.

Not every sub will try to work you over and sometimes the subs will handle the work simply carrying out their responsibilities and you really are almost totally unnecessary. But, there are always holes in plans and spec's and eventually someone is going to bring them up either because they and you never saw it coming or because they saw it from the get go and knew they could hit you for the extra when it came up. When there is a change order, you have to go to the homeowner and tell them you were not specific enough in the plan or spec's and the job is going to cost them more money. You better be able to handle that experience also.

The tough thing is that most designers are not working in the markets that need as much design work that requires contract administration. It is where competitive pricing is a big factor. People simply don't want to pay for things that they don't feel they need. It might be true that having an independent designer oversee the whole project on a $100k job might be in the best interest of the client. But when they interview a few design/builds with great portfolios and excellent reputations that will do a schematic landscape plan for $1k-2k, they tend to see less of a benefit and decide to keep the other $10-$20k for something else. That is certainly the case if the landscape job is under $50k. The less subs involved the less likely someone will pay for contract administration.

I believe that until you are regularly getting design work for jobs over $100k, you are not going to find too many people willing to pay for contract administration. I'm not saying it is right or wrong. I'm just saying that you can't get paid what you want to get paid unless someone wants to pay it.

[Chris Heiler]

The tough thing is that most designers are not working in the markets that need as much design work that requires contract administration. It is where competitive pricing is a big factor. People simply don't want to pay for things that they don't feel they need. It might be true that having an independent designer oversee the whole project on a $100k job might be in the best interest of the client. But when they interview a few design/builds with great portfolios and excellent reputations that will do a schematic landscape plan for $1k-2k, they tend to see less of a benefit and decide to keep the other $10-$20k for something else. That is certainly the case if the landscape job is under $50k. The less subs involved the less likely someone will pay for contract administration.

I believe that until you are regularly getting design work for jobs over $100k, you are not going to find too many people willing to pay for contract administration. I'm not saying it is right or wrong. I'm just saying that you can't get paid what you want to get paid unless someone wants to pay it.

Well said AGLA, this is exactly right.

This is why I'm adamant about not lowering my design fee. Not every design project turns into construction with project management.

Now, I don't think projects of only 100K + need a project manager. In my opinion it depends on the number of craftsmen and contractors. Last year, I designed and managed a project in the $35,000 range. I had 5 subs- landscape contractor, irrigation, metal fabricator, carpenter and custom concrete. I also supplied the site furnishings. It's not so much about the size of the budget, but the amount of detail in the project.

Like I said in my previous post, if a design only requires a qualified, quality landscape contractor, I just refer them to the homeowner. It wouldn't be in the best interest of the client for me to oversee the project and make 10-20%.