This hodgepodge includes interior designers, industrial designers (NOT ARCHITECTS) and graphic designers. Efficiencies derived from technology, such as computer aided design software, have been a boon to these businesses. Meanwhile, design firms can charge a good buck for their talent.
Goddamnit! Why is that?
I can offer a couple of reasons: 1) architecture is not scalable. You design one iPod, and you make money off every other one you sell, with no further design investment. But most houses (never mind big buildings) require a year and a half full time effort by an architect, for a very low profit margin. And you can't repeat the design. New site=new design.
2) Architects are at the mercy of everyone else on the team, since the architect is in effect the coordinator for the whole team. It means the architect is required to take responsibility for and solve most of the problems from the other consultants. Example: I'm working on a very high end house. The owner hired an interior designer, whose fee is roughly 33% of ours. But all they do is attend a few meetings and color in pencil over our drawings. We then have to draft their work—"less chance of error that way"—coordinate their work, and account for mistakes. So for about 1/20th the work, they're getting 1/3 what we are.
also, architects are bogged down by doing waaaaay more drawings and construction admin to produce their designs. after a graphic designer lays out a letterhead for someone, they don't have to make twenty pages of blueprints for it to become a reality.
interior designers make $$$ off of selling product (as do contractors). Architects sell services which end up being negotiable, undervalued, etc. We should start selling buildings
what we need is a development firm who also does the architecture so you can then sell the buildings, youre right mdler.
that way, architects services wont be undervalued as much, since they would be part of the developer group as well. of course, then the developer gets a little less, so he probably wouldnt go for it.
but i am sure there's a way where it could even out for everyone.
like if your design fees wouldnt be as high to begin with, since you are in house. then all the CA work would be tied in with any rental, leasing or sales profits.
I actually have a lot of respect for well-done interior design. If I ever get around to setting up my own shop, I could easily see myself doing a lot of interior design work to help subsidize the more glamorous architecture projects. Most boutique NYC architecture firms seem to start out doing interiors, anyway.
The issue with becoming the developer of buildings is that it is its own profession, outright, of which architecture is a sub set. It makes no sense to become a developer just to execute your design ideas becuase then you will be a very limited developer who may find no one buying their units.
its my understanding that Portman is a partner in a development firm. But regardless - Portman's architecture is fairly specific to his market - the suburban office/hotel complex.
the developer would have to be a seperate person from who is doing the designing. it essentially would probably be the same thing as an arch firm who does a lot of work for a certain developer. so it probably wouldnt work in the long run.
but its kind of the same as when an architecture firm that also has an engineering department or interior design department. it makes those aspects of a job run a little more smoothly, when you can just walk over to someone's desk and talk to them and work through project issues, rather than going through regular channels and take a week to get answers.
what if this A/E firm also merged with a developer? then, theoretically, those aspects of a project would then be able to run a little more smoothly.
i mean, it probably would never really work that way
its just a though
Why does he keep getting associated with suburbia? Jezz, he does Northpark (which failed epically) and now all he's associated with is the suburbs. When everybody else was retreating to the 'burbs in the late 60's, Portman was building in the middle of downtown Atlanta, maybe because it was cheaper to build in downtowns back then, but regardless the man has built far more in an urban environ than a suburban one.
4arch, I imagine I use at least $4 worth of the coffeeshop's electricity every time I sit down and plug in my laptop for a few hours.
From the Fresh Air I'm listening to right now, it sounds like starting up a business where you can ding your customers with hundreds of constant small fees is the best bet.
(...this may hijack the thread, but I'm intrigued by the debate under mdler's loose header, "we should sell our own buildings", the notion of trying to be ahead of market forces and thus the developer, and the notion of mixed results from turnkey ops and increased profit margins within design/build firms...is 'architects' in parentheses because architects offer too much: "Architects are at the mercy of everyone else on the team, since the architect is in effect the coordinator for the whole team" , or too little: "But most houses (never mind big buildings) require a year and a half full time effort by an architect, for a very low profit margin. And you can't repeat the design. New site=new design.
")
I think when Portman was working in downtown Atlant and Downtown LA land was extremely cheap and really neither downtown in the 60's was urban in the classic sense. Use intensive maybe but nut urban. Downtown LA was essentially obliterated and fields of parking lots.
apurmiac - to answer the question whys he assoc w the burbs - its because his mixed use planning, privatized public space model has been replicated in every "edge city" orbiting American cities.
So its his fault other developers wanted to replicate his model to the 'burbs? I'm sorry I just don't appreciate the hate and ignorance that surrounds the man in this profession. God forbid one of us actually make a buck.
I mean, the man's no saint and as we speak he's orchestrating a major development in Korea which will completely fubar the harbor. Then again Corb got very mixed reviews on Chandigrah. This is the game we play folks. We can't all be Peter Zumthors, then again we can't all be John Portmans, but we can definitely learn from the two and see if we can't form our own approach. We gotta get paid, we just do. Then again we can't become total sellouts.
Wait - Im not dissmissing him. In fact I did an entire research presentation and then project based on him and was chastised by my professors in college because of him, what Im saying is his architecture is his architecture and his development biz is his development biz. Hes not a developer and property manager simply to advance his architectural philosophy.
David Hovey of Optima does very much what were talking about here. Develops his own designs. Many of the beautiful buildings as well.
How does he have success while others fail, or dont bother to try?
"is 'architects' in parentheses because architects offer too much?" Good point, Marlin.
In architecture, the same guy (or gal) designing the thing is often managing the team, coordinating the construction, dealing with client gripes, doing marketing.
In industrial design, it seems like these jobs are partitioned into much more specific roles. Are the designers of, say, a vacuum the same ones coordinating its fabrication in China, dealing with Walmart for sales, dealing with the advertising campaign? No, these are separate roles, left to those who do them well.
We've assembled a business model that doesn't seem to work (particularly from a profitability standpoint) and yet architects around the world are perpetuating that model.
believe me im all for making money - but to truely be true to the philosophy of market capitalism theres no room for design dogma then - Hovie, Portman are pushing there "style" but a true developer/ architect would design for the market and that means for every Old Orchard Woods, They may have to take on a Faux Prarie Style Strip Mall. To not is to not be a pure player capatalist - Portmans a bit differnet than Optima in that they property manage. Optima has a market style and is in large en
believe me im all for making money - but to truely be true to the philosophy of market capitalism theres no room for design dogma then - Hovie, Portman are pushing there "style" but a true developer/ architect would design for the market and that means for every Old Orchard Woods, They may have to take on a Faux Prarie Style Strip Mall. To not is to not be a pure player capatalist - Portmans a bit differnet than Optima in that they property manage. Optima has a market style and is in large en
What this comes down to (and pardon the expression) is that an architect is everybody's bitch. Ultimately, we have very little power. The client actually governs the design to a large extent, and the contractor often governs the construction.
I went into this profession thinking it would give me autonomy and the ability to design cool things that I largely had a say over. But the opposite is seeming true. Very little autonomy, and very little control.
Which equals very little control about how much money you make.
As my dad always says, "you're either the capitalist, or you work for the capitalist."
thats funny you should say that farwest, because it reminded me of another thread going saying how architects as a profession have low self esteem. i think part of that might be similar experiences to yours, where people go into architecture with the expectation that they will have the final say on their designs, or that they will even be designing at all.
its not anything like they were expecting it to be.
it seems that we as architects need to be able to walk away from a project if it goes against our design principles. then we would be in more demand. of course that really wouldnt work, as then the client would just hire another architect to do it exactly the way they want it.
ah well
i guess it all depends which is more important to you as an individual. making a good amount of money or working somewhere where you have complete control over your ideas. unless you become a starchitect, chances are you wont have that power.
just become a freemason, or some other powerful old boys club, where you will get a bunch of commissions and be able to do whatever you want because you are working for your friends.
The fun thing about capitalism is that it's a market system and i'm sure there's an untapped market for good design in the U.S. of A. We can gripe about the system, or we could try and change things to our advantage. Who knows, we might as well try.
There absolutely is and there is an equally large chasam between the definition of good design. I only think this way because Ive spent some years on the other side in construction and around business people and they really see the architect as a goofy nessessity that realizes their ( the client's ) vision. Its amazing how many times Ive seen the architect do it all and struggle against the "vision" only to watch in disbelief as the client explaines to the Dentists at the opening reception of the new clinic how they designed it all the architect worked it out. If it were only that easy. I guess if you spen $2million though you can say whatever you want.
But as far as design - I cant tell you how many people really truely believe good design is functional, warrantied, well crafted. Thats it.
I know, we've got this one client who thinks he designed his entire place and the architect was only a facilitator. That kind of attitude pisses me off and I hope at some point in my life I can have the luxury of turning away clients that operate like that.
Yes, but.....isn't the architect only a facilitator? Only a functionary in the realization of the client's vision?
I'm being a little tongue in cheek here. But it hit me like a ton of bricks when I thought about it today: architects have little autonomy. Architects are just employees—even those who run their own businesses.
Even Frank Gehry is only an employee, a facilitator of his client's vision. His client (Paul Allen, say) provides $200 million dollars and asks Frank Gehry to help him.
You're either the capitalist, or you're working for the capitalist.
I'm not getting your "true developer" idea, EvilP -- not sure why an architect/developer who decides to pony up the cash and take on all the financial risk in exchange for design control isn't capitalism. Isn't such a person creating a market? Demand within any market starts somewhere.
i guess what Im saying is yes to the idea that roling the bones and getting the capitol together to build the building as imangined for the use as imagined is capitalism but what happens next - if it doesnt work or the margin is too thin - do you go back to the drawing board and and design the next one for better margins? A true developer will and not think twice. It could be hard for persons with such personal investment in the design. Unless of course your design concepts sell - then by all means work it - shake and pop baby.
The way I see it, sometime people need to be told what to buy. Markets get invented for things all the time. Apple found a market for well-designed consumer electronics that before they came along people didn't even know they wanted. Maybe it can be the same way with housing. All the houses built today are the same faux european McMansion, when magazines like Dwell clearly indicate there is a market that runs against that trend which so far no one has yet to really capitalize on. The free market is more about choice than it is about money, and I don't see the choice. As long as we can't advertise our services to everyday Americans, or at least market them to housing developers we'll never be able to show them a house can be so much more than drywall, 2x4s and vinyl. Cheaper, Better, Faster, Stronger.
Good graphic/web and industrial design = more money for companies.
If you can translate design into dollars, the sky is the limit (and this includes architecture, with "brands" like Hadid and Libeskind).
I think too many architect's miss that talent is worth dollars. It is not just about a service provide, but the inherent talent that a firm has. Market talent and demonstrate how that talent is worth more money and you can ask more for services.
"it sounds like starting up a business where you can ding your customers with hundreds of constant small fees is the best bet."
As I am in the middle of purchasing my first house, I do think this is the way to go! We ought to charge our clients for all our overhead, as well as a design fee. We'd be rolling in dough!
Processing fees, stamp fees, software fees, code fees, hard hat fees, poche fees, note-taking fees, scale fees, spec fees, due didligence fees, hand holding fees, fee assessment fees and fee writing fees. After all, if what we do is only 10% design, why do we only charge for that? No wonder we can't make a profit.
interior designers make $$$ off of selling product (as do contractors).
yeah, but you're forgetting about OVERHEAD COSTS. all the $time$ required to apply the makeup (i guess true for the guy IDs too?) [the preceding was a joke. Please do not soopersquirt the jester. Also, do not let the jester come into any contact with plain water or soap-bubbles after midnight.]
Architects sell services which end up being negotiable, undervalued, etc. We should start selling buildings
i gotta used bridge in brooklyn up fer sale on ebay. i saved a lotta dough getting it, so i can give you a good deal, but you need to buy it by tomorrow cuz a deal like this won't last long...
The most and least profitable businesses to start
I was excited to see designers in the "best" list. But then reality was literally outlined for me in the paragraph.
Forbes
No. 4: Specialized Design Services
Average Pretax Margin: 17.6%
This hodgepodge includes interior designers, industrial designers (NOT ARCHITECTS) and graphic designers. Efficiencies derived from technology, such as computer aided design software, have been a boon to these businesses. Meanwhile, design firms can charge a good buck for their talent.
Goddamnit! Why is that?
I can offer a couple of reasons: 1) architecture is not scalable. You design one iPod, and you make money off every other one you sell, with no further design investment. But most houses (never mind big buildings) require a year and a half full time effort by an architect, for a very low profit margin. And you can't repeat the design. New site=new design.
2) Architects are at the mercy of everyone else on the team, since the architect is in effect the coordinator for the whole team. It means the architect is required to take responsibility for and solve most of the problems from the other consultants. Example: I'm working on a very high end house. The owner hired an interior designer, whose fee is roughly 33% of ours. But all they do is attend a few meetings and color in pencil over our drawings. We then have to draft their work—"less chance of error that way"—coordinate their work, and account for mistakes. So for about 1/20th the work, they're getting 1/3 what we are.
3) Liability insurance
also, architects are bogged down by doing waaaaay more drawings and construction admin to produce their designs. after a graphic designer lays out a letterhead for someone, they don't have to make twenty pages of blueprints for it to become a reality.
architects never, ever stop designing ... and we never, ever get it right the first time.
interior designers make $$$ off of selling product (as do contractors). Architects sell services which end up being negotiable, undervalued, etc. We should start selling buildings
this is kindof skewed. there's too many variables in a business to really say which is least and most profitable. it all depends on how its run.
I have a friend who owns a pool design/build service, their profit margin is consistently above 50%.
A contractor here who specializes in restaurant construction normally has 25%-30% profit margins.
what we need is a development firm who also does the architecture so you can then sell the buildings, youre right mdler.
that way, architects services wont be undervalued as much, since they would be part of the developer group as well. of course, then the developer gets a little less, so he probably wouldnt go for it.
but i am sure there's a way where it could even out for everyone.
like if your design fees wouldnt be as high to begin with, since you are in house. then all the CA work would be tied in with any rental, leasing or sales profits.
I actually have a lot of respect for well-done interior design. If I ever get around to setting up my own shop, I could easily see myself doing a lot of interior design work to help subsidize the more glamorous architecture projects. Most boutique NYC architecture firms seem to start out doing interiors, anyway.
architects are the catfish of the building profession...swimming on the bottom, taking what they can get
The issue with becoming the developer of buildings is that it is its own profession, outright, of which architecture is a sub set. It makes no sense to become a developer just to execute your design ideas becuase then you will be a very limited developer who may find no one buying their units.
I wish I had the magic answer.
^Portman managed to do it.
its my understanding that Portman is a partner in a development firm. But regardless - Portman's architecture is fairly specific to his market - the suburban office/hotel complex.
the developer would have to be a seperate person from who is doing the designing. it essentially would probably be the same thing as an arch firm who does a lot of work for a certain developer. so it probably wouldnt work in the long run.
but its kind of the same as when an architecture firm that also has an engineering department or interior design department. it makes those aspects of a job run a little more smoothly, when you can just walk over to someone's desk and talk to them and work through project issues, rather than going through regular channels and take a week to get answers.
what if this A/E firm also merged with a developer? then, theoretically, those aspects of a project would then be able to run a little more smoothly.
i mean, it probably would never really work that way
its just a though
Why does he keep getting associated with suburbia? Jezz, he does Northpark (which failed epically) and now all he's associated with is the suburbs. When everybody else was retreating to the 'burbs in the late 60's, Portman was building in the middle of downtown Atlanta, maybe because it was cheaper to build in downtowns back then, but regardless the man has built far more in an urban environ than a suburban one.
most profitable - coffee shop, 400% margin
least profitable - restaurant
4arch, I imagine I use at least $4 worth of the coffeeshop's electricity every time I sit down and plug in my laptop for a few hours.
From the Fresh Air I'm listening to right now, it sounds like starting up a business where you can ding your customers with hundreds of constant small fees is the best bet.
lb, Change Order & Additional Services baby!
N.I.C. - Not In Contract biatch!
(...this may hijack the thread, but I'm intrigued by the debate under mdler's loose header, "we should sell our own buildings", the notion of trying to be ahead of market forces and thus the developer, and the notion of mixed results from turnkey ops and increased profit margins within design/build firms...is 'architects' in parentheses because architects offer too much: "Architects are at the mercy of everyone else on the team, since the architect is in effect the coordinator for the whole team" , or too little: "But most houses (never mind big buildings) require a year and a half full time effort by an architect, for a very low profit margin. And you can't repeat the design. New site=new design.
")
I think when Portman was working in downtown Atlant and Downtown LA land was extremely cheap and really neither downtown in the 60's was urban in the classic sense. Use intensive maybe but nut urban. Downtown LA was essentially obliterated and fields of parking lots.
apurmiac - to answer the question whys he assoc w the burbs - its because his mixed use planning, privatized public space model has been replicated in every "edge city" orbiting American cities.
So its his fault other developers wanted to replicate his model to the 'burbs? I'm sorry I just don't appreciate the hate and ignorance that surrounds the man in this profession. God forbid one of us actually make a buck.
i agree Apurimac
i find it hard to believe that if given the opportunity, everyone here wouldnt have done the exact same thing
I mean, the man's no saint and as we speak he's orchestrating a major development in Korea which will completely fubar the harbor. Then again Corb got very mixed reviews on Chandigrah. This is the game we play folks. We can't all be Peter Zumthors, then again we can't all be John Portmans, but we can definitely learn from the two and see if we can't form our own approach. We gotta get paid, we just do. Then again we can't become total sellouts.
Wait - Im not dissmissing him. In fact I did an entire research presentation and then project based on him and was chastised by my professors in college because of him, what Im saying is his architecture is his architecture and his development biz is his development biz. Hes not a developer and property manager simply to advance his architectural philosophy.
Hmm, my research paper says different. It's cool evilp, its just i get tired of the profession's attitude towards money sometimes.
David Hovey of Optima does very much what were talking about here. Develops his own designs. Many of the beautiful buildings as well.
How does he have success while others fail, or dont bother to try?
Optima's Old Orchard Woods... its pretty nice
"is 'architects' in parentheses because architects offer too much?" Good point, Marlin.
In architecture, the same guy (or gal) designing the thing is often managing the team, coordinating the construction, dealing with client gripes, doing marketing.
In industrial design, it seems like these jobs are partitioned into much more specific roles. Are the designers of, say, a vacuum the same ones coordinating its fabrication in China, dealing with Walmart for sales, dealing with the advertising campaign? No, these are separate roles, left to those who do them well.
We've assembled a business model that doesn't seem to work (particularly from a profitability standpoint) and yet architects around the world are perpetuating that model.
believe me im all for making money - but to truely be true to the philosophy of market capitalism theres no room for design dogma then - Hovie, Portman are pushing there "style" but a true developer/ architect would design for the market and that means for every Old Orchard Woods, They may have to take on a Faux Prarie Style Strip Mall. To not is to not be a pure player capatalist - Portmans a bit differnet than Optima in that they property manage. Optima has a market style and is in large en
believe me im all for making money - but to truely be true to the philosophy of market capitalism theres no room for design dogma then - Hovie, Portman are pushing there "style" but a true developer/ architect would design for the market and that means for every Old Orchard Woods, They may have to take on a Faux Prarie Style Strip Mall. To not is to not be a pure player capatalist - Portmans a bit differnet than Optima in that they property manage. Optima has a market style and is in large en
What this comes down to (and pardon the expression) is that an architect is everybody's bitch. Ultimately, we have very little power. The client actually governs the design to a large extent, and the contractor often governs the construction.
I went into this profession thinking it would give me autonomy and the ability to design cool things that I largely had a say over. But the opposite is seeming true. Very little autonomy, and very little control.
Which equals very little control about how much money you make.
As my dad always says, "you're either the capitalist, or you work for the capitalist."
thats funny you should say that farwest, because it reminded me of another thread going saying how architects as a profession have low self esteem. i think part of that might be similar experiences to yours, where people go into architecture with the expectation that they will have the final say on their designs, or that they will even be designing at all.
its not anything like they were expecting it to be.
it seems that we as architects need to be able to walk away from a project if it goes against our design principles. then we would be in more demand. of course that really wouldnt work, as then the client would just hire another architect to do it exactly the way they want it.
ah well
i guess it all depends which is more important to you as an individual. making a good amount of money or working somewhere where you have complete control over your ideas. unless you become a starchitect, chances are you wont have that power.
just become a freemason, or some other powerful old boys club, where you will get a bunch of commissions and be able to do whatever you want because you are working for your friends.
The fun thing about capitalism is that it's a market system and i'm sure there's an untapped market for good design in the U.S. of A. We can gripe about the system, or we could try and change things to our advantage. Who knows, we might as well try.
There absolutely is and there is an equally large chasam between the definition of good design. I only think this way because Ive spent some years on the other side in construction and around business people and they really see the architect as a goofy nessessity that realizes their ( the client's ) vision. Its amazing how many times Ive seen the architect do it all and struggle against the "vision" only to watch in disbelief as the client explaines to the Dentists at the opening reception of the new clinic how they designed it all the architect worked it out. If it were only that easy. I guess if you spen $2million though you can say whatever you want.
But as far as design - I cant tell you how many people really truely believe good design is functional, warrantied, well crafted. Thats it.
I know, we've got this one client who thinks he designed his entire place and the architect was only a facilitator. That kind of attitude pisses me off and I hope at some point in my life I can have the luxury of turning away clients that operate like that.
Yes, but.....isn't the architect only a facilitator? Only a functionary in the realization of the client's vision?
I'm being a little tongue in cheek here. But it hit me like a ton of bricks when I thought about it today: architects have little autonomy. Architects are just employees—even those who run their own businesses.
Even Frank Gehry is only an employee, a facilitator of his client's vision. His client (Paul Allen, say) provides $200 million dollars and asks Frank Gehry to help him.
You're either the capitalist, or you're working for the capitalist.
they list graphic designers in that list ...but everyone graphic designer in the list complains how theres no money in it
You're either the pimp, or the ho. I'm a ho with visions of pimpin'.
most profitable- my dad business
least profitable- my own god damn archi office.
i begin to believe that we archi are running non-profit organization... like green peace or something.
I'm not getting your "true developer" idea, EvilP -- not sure why an architect/developer who decides to pony up the cash and take on all the financial risk in exchange for design control isn't capitalism. Isn't such a person creating a market? Demand within any market starts somewhere.
i guess what Im saying is yes to the idea that roling the bones and getting the capitol together to build the building as imangined for the use as imagined is capitalism but what happens next - if it doesnt work or the margin is too thin - do you go back to the drawing board and and design the next one for better margins? A true developer will and not think twice. It could be hard for persons with such personal investment in the design. Unless of course your design concepts sell - then by all means work it - shake and pop baby.
The way I see it, sometime people need to be told what to buy. Markets get invented for things all the time. Apple found a market for well-designed consumer electronics that before they came along people didn't even know they wanted. Maybe it can be the same way with housing. All the houses built today are the same faux european McMansion, when magazines like Dwell clearly indicate there is a market that runs against that trend which so far no one has yet to really capitalize on. The free market is more about choice than it is about money, and I don't see the choice. As long as we can't advertise our services to everyday Americans, or at least market them to housing developers we'll never be able to show them a house can be so much more than drywall, 2x4s and vinyl. Cheaper, Better, Faster, Stronger.
there's always SHoP
Good graphic/web and industrial design = more money for companies.
If you can translate design into dollars, the sky is the limit (and this includes architecture, with "brands" like Hadid and Libeskind).
I think too many architect's miss that talent is worth dollars. It is not just about a service provide, but the inherent talent that a firm has. Market talent and demonstrate how that talent is worth more money and you can ask more for services.
I hate to admit it but drugs are the best option, no taxes, high risk, but really really high (pun intended) pay out
i think i found the reason...
http://www.cnn.com/video/#/video/crime/2008/01/24/pkg.disgruntled.employee.wtlv
firm's receptionist deletes 7 years worth of drawings...
I just want to do event design for oprah and call it a day.
"it sounds like starting up a business where you can ding your customers with hundreds of constant small fees is the best bet."
As I am in the middle of purchasing my first house, I do think this is the way to go! We ought to charge our clients for all our overhead, as well as a design fee. We'd be rolling in dough!
Processing fees, stamp fees, software fees, code fees, hard hat fees, poche fees, note-taking fees, scale fees, spec fees, due didligence fees, hand holding fees, fee assessment fees and fee writing fees. After all, if what we do is only 10% design, why do we only charge for that? No wonder we can't make a profit.
(only halfway kidding)
yeah, but you're forgetting about OVERHEAD COSTS. all the $time$ required to apply the makeup (i guess true for the guy IDs too?) [the preceding was a joke. Please do not soopersquirt the jester. Also, do not let the jester come into any contact with plain water or soap-bubbles after midnight.]
Architects sell services which end up being negotiable, undervalued, etc. We should start selling buildings
i gotta used bridge in brooklyn up fer sale on ebay. i saved a lotta dough getting it, so i can give you a good deal, but you need to buy it by tomorrow cuz a deal like this won't last long...
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