Hiring a design team Part 3: design fees

Jeff Carter, DDS, and Pat Carter, llDA

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In a design firm, the hardest question to answer for a client is, How much will you charge to design my dental office? Similarly, a new patient may call a dental office and ask, What do you charge for a crown? The hard part is not assessing the crown’s potential cost, but addressing the patient’s expectation of an immediate response with little insight into the particulars of the case. Patients presume that “cost” has little to do with which tooth, the condition of the tooth, the restorative material used, the quality of your dentistry, or if a crown is an optimum solution.

The “how much?” question in design is equally hard to answer when there is little insight into the specifics of your project. This is precisely why we spent “Part 1 — drawings” (in the June 2011 issue of Dental Economics®) and “Part 2 — services” (in the July 2011 issue of Dental Economics®) defining qualifiers prior to this “Part 3 — design fees” question.

Design fees should reflect the time spent to achieve the level of detail, expertise, and project involvement from inception to completion of your project. If this is the case, then disparities in fees should translate to specific differences in the drawings, services, and/or expertise provided. To verify, consider the following ...

The scope of service is a detailed description of what will be provided in the fee quoted by design professionals. It is imperative to understand the value lost or gained between a “less or more fee” and how any omission in the drawings or services will impact your project. Ask for clarification of the scope of service: Why is something proposed or not included? Design professionals should welcome your inquiry because it assures them that you want to understand the services proposed. Your inquiry may even prompt a modification of the proposal (additions or omissions) to better meet your needs — both of which are good for your project.

Fixed fees can be assessed for a clearly defined project and scope of service. Part of your project’s “cost management” includes identifying design fees up front. Fixed fees quoted for services to be rendered eliminate additional hourly “billing” for services that are not included in the proposal. This is another reason why it is important to understand the extent or limits of what will be provided to your project.

Miscellaneous or additional charges can be a reason for discrepancies in design fees. These can include printing/mailing costs, phone calls, travel to the job site, and more. Some firms assess a fee for designing and assume other costs are billable as defined during the process. Such items are included in the scope, but will be billed separately.

While this is a legitimate approach, it can lead to frustration when invoices for such items arrive unexpectedly throughout the design/construction process. We recommend that you verify any additional billing items beyond the fixed fee. If applicable, request a total estimate for such charges based on your design firm’s experience in projects of your size and scope so you can plan for such costs. Better yet, negotiate for a fixed fee adjustment to include these items and thus eliminate additional billings.

Design through dealers. Design offered through equipment dealers is paid for through your dental equipment purchase. Typically, fees are not quoted and are qualified as “free” based on a sizeable purchase commitment. Dealer plan layouts generated by in-house draftsmen were enough to get a project started with a “dental experienced” general contractor for years. Design was a viable loss leader for the dealer because of the dentist’s equipment sale garnered in this process.

However, expanded permit requirements and dentists’ expectations for design and cost management of their projects typically exceed the limited drawing and project involvement offered by dealers. Additional design and construction management is delegated to “other” design professionals. Understanding both the limits and incentives for free dealer design services that are combined with other fee-based services is a key to project/cost satisfaction upon completion.

A dental project is a significant investment. Losing value through cost overruns or a poor design outcome is expensive. Fees quoted by design resources should reflect the documentation, services, and expertise (See Parts 1 and 2 of this series) appropriate to achieve an optimum project outcome. Clarify the differences. This analysis will reveal differentiations helpful in choosing those professionals best suited to you and your project.

Jeff Carter, DDS, and Pat Carter, IIDA, are owners of PDG- Practice Design Group. Located in Buda, Texas, PDG offers a full range of design and consulting services to dentists nationwide. For information, call (800) 511-7110 or visit www.practicedesigngroup.com.