Thank you Pasha and Wayne for your clarity. I have had both the $4,000 client and the $48,000 client. I know I lost my shirt, well at least a great deal of my time, on the little guy. I would be willing to be that the $48,000 client didn't do so well either. We have a LEED platinum building here in Portland that I know of that has more problems than you would ever guess. Who do you think pays for the fixes? Probably the same firm that the energy analyst was form. I'm just saying...<br>
<br>Carol<br><br><div class="gmail_quote">On Tue, May 25, 2010 at 12:13 AM, Wayne Seward <span dir="ltr"><<a href="mailto:wayne@beartechnologys.com">wayne@beartechnologys.com</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin: 0pt 0pt 0pt 0.8ex; border-left: 1px solid rgb(204, 204, 204); padding-left: 1ex;">
<div link="blue" vlink="purple" lang="EN-US">
<div>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">Hi Pasha, John, and all;</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">Fees, what to charge, always an interesting question? </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">I always start by answering two basic questions. 1)Do I understand
what is required to do the job and do I know exactly what it well take to
complete the job? 2) I have a relative idea of what is needed to complete the
job and I'm not really sure what it well take to complete it? And a third one
that I try not to forget is always the past history with the customer? There
are basically two approaches that I take to pricing a project,
Time-and-Materials or Fixed price. Time-and-Materials I use when I have more
questions than answers, and Fixed price is used when I have a strong
understanding of what I need to do and then how long I believe it will take me
to accomplish it. So that is my starting point to every job.</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">This next is related to the type of job that I'm performing. This
comes with a larger number of variables, such as the building type. Residential,
Non-residential, non-res office space verses medical facilities, single family
residential or multi-family residential, etc. Also, new construction or
existing retrofit. Size and level of complexity also come into play and the
specific task that I'm being asked to complete. Next I look at the type of
modeling that I'm working on (Compliance documentation, supporting or recommendations
for design decisions, or High-level Performance Modeling & Analysis).</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> My fees start as low as $250 (clearly the easy job with the
lowest risk of failure) and as high as $9,000. I'm currently consider some work
that I'm think of asking $15,000 plus (highest risk of failure to date). Risk
of failure is always an important consideration on any job. The risk of failure
could be nothing more than re-working the job on your dime or as
complicated as getting sued for everything that you hope to ever have. We have
to figure out what our comfort level is in this area before we can figure out
what kind of work we are willing to take on. For me the lowest risk is
Compliance Documentation, and clearly the highest level of risk is doing
High-Level Performance Modeling & Analysis.</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">The last factor that I consider, is what will the market bare?
No matter what we do, somebody will come in with a lower price and another will
have a higher price. I always try to understand what I think my efforts are
worth and if someone comes in with a lower price, then I have to decide if the
work is important enough for me to give something away. To me this has to be a well
thought out decision and not a decision that I make easily. </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">Pricing a job can sometimes be as complicated as some of the
work that we do.</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">I recently saw a financial breakdown of a LEED project. The LEED
Consultant was paid $60,000 plus, and the Building Energy Analyst Modeler fees
ranged from $2,500 to $48,000 per LEED project. I need to find a couple of
those $48,000 jobs :=) </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">If you notice I didn't specify my exact fees for any given
thing. But I hope that I've shed some light onto my approach to the problem.
However, I would be happy to work with any members of this group to develop a
standard fee basis. I'm sure we've all spent a lot of time and money getting to
this point and we continue spending money on continuing Ed & better tools. We
should all get a far wage for our level of experience and quality of work. I
don't have a problem losing work to someone that does a better job than I do,
but I do have a problem with losing work to someone with less experience
because they charge less for the same work.</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">I hope this makes since as it is now past midnight and I'm
getting up in five hours. If you see holes with my thinking, then please share
some of your approaches or ideas.</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);">Thank you for your time.</span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<p class="MsoNormal"><b><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(0, 176, 80);">Wayne Seward, CEA, LEED AP BD&C</span></b></p>
<p class="MsoNormal"><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(0, 176, 80);">Bear Technologys</span></p>
<p class="MsoNormal"><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(31, 73, 125);">7774 Calle Mejor, Carlsbad, CA 92009</span><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: black;"></span></p>
<p class="MsoNormal"><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(31, 73, 125);">Office: 760.635.2327 Fax: 760.683.6889</span></p>
<p class="MsoNormal"><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(11, 54, 105);"><a href="http://www.beartechnologys.com" target="_blank">www.beartechnologys.com</a></span></p>
<p class="MsoNormal"><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(11, 54, 105);"><a href="mailto:wayne@beartechnologys.com" target="_blank">wayne@beartechnologys.com</a></span></p>
<p class="MsoNormal"><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(11, 54, 105);"> </span></p>
<p class="MsoNormal"><b><span style="font-size: 10pt; font-family: "Lucida Calligraphy"; color: rgb(11, 54, 105);">a Service-Connected Disabled-Veteran Owned Business</span></b><span style="font-size: 11pt; color: rgb(31, 73, 125);"></span></p>
<p class="MsoNormal"><span style="font-size: 11pt; color: rgb(31, 73, 125);"> </span></p>
<div style="border-width: 1pt medium medium; border-style: solid none none; border-color: rgb(181, 196, 223) -moz-use-text-color -moz-use-text-color; padding: 3pt 0in 0in;">
<p class="MsoNormal"><b><span style="font-size: 10pt;">From:</span></b><span style="font-size: 10pt;">
<a href="mailto:equest-users-bounces@lists.onebuilding.org" target="_blank">equest-users-bounces@lists.onebuilding.org</a>
[mailto:<a href="mailto:equest-users-bounces@lists.onebuilding.org" target="_blank">equest-users-bounces@lists.onebuilding.org</a>] <b>On Behalf Of </b>Pasha
Korber-Gonzalez<br>
<b>Sent:</b> Monday, May 24, 2010 7:40 PM<br>
<b>To:</b> John David Waller<br>
<b>Cc:</b> <a href="mailto:equest-users@lists.onebuilding.org" target="_blank">equest-users@lists.onebuilding.org</a><br>
<b>Subject:</b> Re: [Equest-users] Energy Modeling Fees</span></p>
</div><div><div></div><div class="h5">
<p class="MsoNormal"> </p>
<div>
<p class="MsoNormal">Hi John,</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">I am soooo glad that you asked about this. I would be
more than happy to talk with you and the rest of our energy modeling community
about how to price energy models, how to calculate & justify fees for
energy models, etc.</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">This is a VERY important discussion that needs to happen
amongst this group and amongst our colleagues regarding the true value of our
services and the value that clients are willing to pay for our services.</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">What do you want to know? What do you want to
discuss? I usually start with a couple of baseline factors that I use as
targets when I put together fees for the projects that I bid on; $/sq ft,
$/hour, but as everything is with energy models..."it depends."</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">Let's talk about this... we can talk online or feel
free to email me offline, or call me at 308-763-1593.</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">As a bottom line--I will offer that at a base fee to
cover 40 hrs worth of billable work for any type of energy model at an average
cost estimate of $100/hr which is a good average for most consulting
companies billable rates. Based on this very rarely should any
energy model fee come in under $4000 just based on the amount of work that
needs to be done on even simple models. Of course your overall
price/cost/fees need to be based on a specific scope of work for whatever the
energy model will be used for.</p>
</div>
<div>
<p class="MsoNormal">If there are others out there that have experience with
energy model fees please comment. My base rule of thumb is this;
"if you give your client a low fee the first time around, they will expect
it everytime." Once you charge low fees for your services you will
not be able to raise them as your customers will expect low fees
everytime. Not only do "low-ballers" hurt themselves but they
hurt all of us in the industry. All of us as simulators know the
amount of time & skill that it takes to learn how to use these programs and
how to execute projects successfully using these programs. If we are
sending out low fees for these services we are severly undervaluing our own
work and giving our clients the wrong impression. As the art of
negotiation is something that we work on everyday, it's better to always start
with the fee that you want, and then tailor, customize, negotiate to a fee that
you & the client can accept. Maybe they don't get as much work as
they wanted, maybe you get a bit more in your fee than the client planned to
pay. Win-win for all...when it all works out right. ;)</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">Pasha</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">On Thu, May 20, 2010 at 10:14 AM, John David Waller <<a href="mailto:jwaller@email.arizona.edu" target="_blank">jwaller@email.arizona.edu</a>>
wrote:</p>
<div>
<p class="MsoNormal">Would anyone be willing to share what a 'fair market fee'
for energy modeling services might look like?</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">I realize that there are many variables involved in defining
the cost of such services, i.e. level of detail, stage in the design process,
size of the project, etc... I am an eQUEST pleeb, and seek only to determine
reasonable rates for this service and ones that won't scare any potential
clients away.</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">Thanks in advance.</p>
</div>
<div>
<p class="MsoNormal"><br clear="all">
John</p>
</div>
<p class="MsoNormal" style="margin-bottom: 12pt;"><br>
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</div>
<p class="MsoNormal"> </p>
</div></div></div>
</div>
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<br></blockquote></div><br><br clear="all"><br>-- <br>Carol Gardner PE<br>
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