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Speaker 1: Welcome, everyone, to architect's marketing Q&A session for the low commitment consultation module. This is our core training on something that is so important for all of you to really get comfortable with and to run with. And we've got everybody in far-flung parts of the world. Hey, Richard, Enoch, String. String: Hey, guys. Sorry. I can't improve the light here. It's a really beautiful architectural light but not very functional. It's beautiful but doesn't cast a lot of light. Enoch: Well, that's what they say about architecture, right? Beauty over function. String: It's beautiful. I love it. Enoch: Hey, look. I'm pretty excited to be on. I was so looking forward to this particular office hours Q&A session because I really think that the low commitment consultation is one of those big levers if you look at ... If you're going to be making changes in your practice, implementing some of the strategies we talk about in the academy, I really feel this is one of the largest levers. There's always that story about the plumber who comes in and he taps the one little spot on the drain and it gets unclogged, he charges you $100 and he says, "Well, it was $1 to tap the drain but $99 to know where to tap." If you're thinking about that knowledge being the big lever, I'm pretty excited about this. I know we have some good questions. Speaker 1: Okay. Well, Richard, want to take it away and get rolling with this? Let's make sure. Can everybody hear us and see us? So just type in. Let us know. Can you see our webcams, as well as the title slide? All right, see Hi, Evangelo, and Don. Oh, and Michael says, "No webcams," so can someone just turn off their webcam and turn it back on? Because sometimes that helps. Speaker 1: All right. Okay, so Michael says, "Now it's all good." He couldn't see the webcams before, so, good. All right. Take it away, Richard. You are muted, Richard. Richard: Okay. I agree with Enoch. I think this is one of the ... I shouldn't be. Speaker 1: No. I think it was just a delay about- Richard: Can you hear me? Speaker 1: About two second delay before your sound came in. Sorry about that. Richard: I just switched myself back on. Yeah, I also agree. This is one of the most important ones to master or to apply or to implement because I've just seen so many architects do well with this all over the world and even architects who thought, "I wouldn't be able to charge a fee for doing some sort of pre-design advice," have been amazed that when it's positioned right and when they've educated the clients as to the value of it, they've been surprised that they can actually sell it and once you sell an LCC, even though it's only a small consulting exercise, your chances of winning the design work go up exponentially. Richard: So it literally is getting them on that first rung of the ladder or the first step because once they've paid you 750 for a consultation gig, they've now become a client, and even though you can say, "There's no commitment to do the design work or anything else beyond this step, let's just clear up some assumptions and let's reduce your risk and let's make sure that you've got the best design options before you go to design or you understand the best options." Even though you're only doing that with no commitments, you'll almost always end up ... They'll end up following up with you and getting the design work done by you, more often than not. One, it's easy to sell because it's small, but two, it leads ... They become a client and they end up sticking with you, so, really, really important. Richard: So what we're going to do is just go through your questions. These sessions are really about you asking the questions and us just answering whatever's relevant to you. I know we've got a couple of questions. Hello. We've got the usual suspects here, isn't it, really? Sorry, Stefan, I couldn't catch up with you today, so Stefan and I, we're going to try and catch up but we couldn't. I'm back to back all day. Richard: Okay, so if you've got any questions, type them in the chat box, around the LCC. I know one came through. And then, what we'll do is we'll just go through a quick tour through the new members' website just showing you what's there and around the training, and I'll just add some comments to some of the training that we've got on the LCC and the members' website. Well, String .... It actually came through on an email, String, so if you want me just to ... Yeah. That's it. Richard: All right, so Erick Mikiten says, "For a single family home, most architects are not giving a fixed fee. The rationale that it needs an options review will provide a framework for other bidders isn't very applicable. Most architects just give people a percentage estimate of the percentage of the construction costs as a range. It seems to make more sense either A, for commercial projects or B, for remodels where people don't know what they can do and an analysis with a few sketched concept plans and some zoning research that another architect could use. How can this become more compelling? I need for a new house project. I'm meeting with someone on Thursday who wants to do a small house on their 20-acre property. They already determined the building site and researched zoning information. How can an LCC approach be tuned for that sort of situation? Thanks." From, Erick. Richard: All right, Enoch. I'll give you a crack at this. Speaker 1: Let's open up Erick's line so in case he has something to say. Erick, I've opened up your line. Are you there? Erick: Hi guys. Yes. I'm here. Richard: Hey, Erick. How are you? Erick: Great. Richard: Where are you coming in to us from today? Erick: Berkeley, California. Richard: Oh, that's right. Of course. Very nice. Enoch, what are your thoughts? Enoch: Well, I think that perhaps we can ask Erick some questions that will be valuable for getting to the answer here, which is how can this be ... What's a compelling needs or option review for a new house project? And I think, Erick, you're going to be the expert in this because they're your clients. They're your kind of work. You know their needs, and so what we can probably do is help you facilitate this since we have you on the line right now, is perhaps just ask a couple questions and figure out how this is. I'm just going to give you one example. I'm staying here at a little villa here in Hawaii right now and I'm on a work-cation, so we're here for a month. This house was newly remodeled and when they remodeled it, the whole house is vaulted. In the main living space they chose not to do a double ceiling for whatever reason, right? They chose not to build it up so they could have that vaulted air flow. Enoch: Now, code issues aside, that's how they did it. On the back half of the house, and new architects will know what I'm talking about, they did put that airspace in there with some insulation and some fence around the perimeter of the house and then a ridge vent on top, so in the back part of the house, it's very cool all the time. We have the fans on and we have this nice air blowing through, but during the middle of the day, it's kind of hot here in Hawaii right now, and that living space is just unbearable. It is just too hot. Okay? Enoch: Now, this is a house that's worth over $1 million, okay? Think about what a shame to skimp on the maybe tens of thousands of dollars it might have cost to do the double roof construction over the vaulted area. How that detracts from the value of the house overall. I mean, once you make a decision like that, you can't ever erase it, so the question is, Erick, is there something similar like that? Some process that you can go through and identify maybe the visual corridors on the site? Perhaps you can identify ... You talked about they already determined the building site and researched zoning permission. What we want to do here is we want to make this thing ... We want to sell it, so that's what we're trying to do here is we're trying to come up with the marketing language that is going to sell this LCC to your clients, and like you said, create something that's really compelling. Enoch: So I'm just going to put it back on you. Do you have any thoughts on some pre-design work that can be done that would save them time and effort and expense, and give them more value in the future that other architects don't generally do? Erick: Sure. I guess one of the things is sort of the classic pieces that we've been talking about, which are sort of trying to get into more site analysis and hope that I can devise something beyond what they've already considered. I've had a lot of times where a client will come to me and they'll think that they've figured it all out, quote/unquote and once, often for remodels, they say, "Oh, I know we want to do in addition to the back and it wants to be like this," and I come in and I say, "Oh. Well, don't you think the kitchen's in the wrong place to start with, and then, everything blown open?" Sometimes there's opportunities like that. Erick: Here, since I haven't met them in person yet, I'm not sure how ... a remodel or a new construction project in the past, so they are new to it. They seem like they've gathered a fair bit of background. It's their parents' property that they've had for 50 years, already has another house on it, so they do have a sense of ... They understand the drainage problems on the site and where there's water available and things like that, so I don't feel like I can come in and say, "Oh. You're 3,000 feet off in where you want to place the building." It would be more sort of fine tuning, but that's less dramatic, so I'm just wondering if there's other sorts of tools at this point to offer that sort of analysis or something else for this sort of project. Richard: I'll make a comment here, Erick. It seems to me there's two big categories of benefits of doing pre-design advice: One is to reduce the risk for the owner, and the second is to make sure when you do go to design that you're going to be designing the best option as opposed to the third best option because they haven't considered all the options. It's around eliminating risk, and it's around improving the ultimate design by not jumping to the first design that comes to someone's head. Richard: Okay, so point number one, reducing the mistakes or eliminating the assumption ... It's all around assumptions. It's typical for people to jump into things based on a whole lot of assumptions, so it's around removing the assumptions and the more assumptions that can be removed, the more accurate an architect can be. The key to, for me, anyway, those are the two areas. The key for selling those two areas is to be pre-armed already with some very good stories, like Enoch's just given a story, right? There's nothing more powerful than two or three stories, one on two of those categories. You need to be armed with these stories, and you've probably already got stories, or you've been into houses or buildings where you can turn it into a story, just like Enoch did and say, "Here's what they've done. They've done it this way. Clearly, they rushed into design before they considered all the factors, and now the house is unbearably hot in the summer and the room is almost unusable because they went into the design phase too fast." Richard: They hadn't done the type of research or reduced some of the assumptions because, say, in Enoch's house, the assumption was that what we're doing now will be quite acceptable from a heat point of view in the middle of summer. Well, it was an assumption that was wrong, and now that room is almost unusable at certain times in the day. You effectively can't use the room. Well, that's a huge mistake, either by the designer or by the homeowner not taking the time, not allowing the designer the time to go and find out what all the facts are before he ... Maybe the design was rushed into the design, which is what we're talking about. Richard: So if you can find a series of stories that talked about the mistakes, and don't always blame the architect. Sometimes, you can say that the owner of this house rushed it through too quickly because they were in a rush. But if you have a little set of few stories, like a couple of good stories is very hard to combat. It's impossible to combat a couple of good stories. As long as you know it's around eliminating the homeowner's risk, and the risk might be around cost, or the risk might be around time, or the risk might be around getting the best option instead of getting the third-best option. So it's around reducing risk and getting the best design. And I think, remind the client that, to do this analysis is incredibly cheap when compared with if we discover anything later on, we go, "Aw, whoops, we should've done it this way." It's incredibly expensive to change it later, but incredibly cheap to go and do the research and analysis now so that we don't have to make those changes later. Erick: Right. Richard: So, that's my two pence worth. But all that sort of stuff is covered in those videos that we've made. Enoch's recorded some scripts for a video, and the incoming call script that anyone, any of you guys, can just take the video and just put on your website. [inaudible 00:16:24] on there, and then explain some of these key points. I think it's very compelling, and it's kind of hard as homeowner. Even if they want to save money, if they go, "Oh, price is a factor." "Great, then you need to do this. It's even more important for you to do the needs and options review. Because if price is a factor, then we need to make sure that we're doing it right first time. Erick: That's a useful point, because this client is particular, has a pretty low budget that may be achievable, but it's going to be right on the edge, and I've already told them that. So maybe I can leverage that concern that they have about the construction cost as a greater rationale for spending a little bit up front like this. Richard: Yeah, well that's it. And, ironically, spending the 750 or something for you to do this is for people who want to save money. Erick: Right. Richard: You know? That's how you sell it, because ... And this graph here, that [00:17:30 Mark Siddle], I know he's on the line, but Mark came up with this all architects would say this but Mac, that graph there. Oh, he just came back to the graph? Erick: Mm-hmm (affirmative). Richard: This graph really is around. It identifies the cost of change as time goes on. So it's very low at the start, when you haven't done anything, that's just design. It's very low to make changes at the start. And then it starts going up. This graph actually, Mark says it's actually exponentially more than this, but it starts going up massively as the project moves on. And the top one is the opportunity to change. So there's lots of opportunity for changing the design, or once you come up, and lots of opportunity at the start, but as time goes on, your ability to make those changes goes down exponentially, the cost of making those changes go up exponentially, and even I can understand this chart and go, "Okay, we'd better make sure we've measured twice and cut once." String: I'd also like to add here, the LCC, it doesn't mean that it needs to be really low cost. It just needs to be, it's not the full fee. And, if, in the module, I'll call up the example for a completed LCC from Bruce, that's the one that comes to mind. So if I clicked on Bruce's LCC, and you'll find that inside the LCC module, [inaudible 00:19:13] I can't see the go to webinar panel, so if you can check, it would be good to get his idea on it. But he calls it "formulating the brief". String: And there's quite a bit of text, here, and I know that you said, look, they've done the erasage. But what he's put at the end, I really like. He's gone through proposed design strategy, project needs, project options, proposed documentation, and, on the last page, he's put in some concept plans, which I think, is really good. And I know this gets into design, but, as a designer, you're breaking up your fees between the concept and then the documentation and the construction drawings. The LCC doesn't have to be 750 and then do a whole lot of work, but give them what they need to reduce their risk. So, what do you think, Enoch? It's sort of going into the design, but it's open to how you want to structure it, depending on the client. Enoch: Yeah, yeah, I definitely agree with that. What we're looking, here, for, and I think, just from your response, Erick, it sounds like it has been helpful. But, just remember with the LCC, what we're not trying to do here is invent something. We're not trying to invent an extra step just to increase the likelihood that they'll become a client. That's sort of like a side benefit. What we're trying to do here is we're trying to uncover the hidden pot of gold. What're those levers at the very beginning of a project, that if we uncover, and we do a little bit of research in them, can have enormous payoff in the backside? Enoch: So, for every architect, they're going to be a little different, but when you're thinking about your LCC, you want to think about something that's not customized for every client in terms of what it offers. So, every time you have a client, you don't want to try to think, "Okay, what's the LCC for this, what's going to be different?" No, you just need to have a standard package, a standard offering. This is our needs and options review; here's what it does, one, two, three; and then, the hidden pot of gold would be, "Okay, what are we uncovering?" Enoch: In my example here, heck, if we would've done a design study and some research and thought about how the construction details are going to happen, and thought about the temperature in Hawaii, then we could have a house that is going to be worth a couple million dollars at the end. So that's where the value comes into it. Enoch: Is this helping, Erick? This conversation, has it helped you out? Erick: Yeah, it is. And you brought up something that you said, you're not trying to invent a separate step, which actually brings up the other question that I had, which is that sometimes you don't know whether a client may be meeting with you had already done their research, talked to the reference who referred them, and they're ready to go, and you should just reel the fish in, as opposed to throwing out more chum, which is sort of what the LCC is. And is it a risk, sometimes, and how do you know whether it is, to throw out the idea of, "Oh, let's slow the process down," as Richard said, in the video, for some romance in the relationship, and when is it make more sense to just go to the chapel and get married? Erick: I like your metaphor, Richard. Richard: Yeah, that's right, that's right. Behold the drive-thru chapel at Las Vegas. Richard: Most of those marriages don't go too well. Erick: Maybe that says it all. Richard: Yeah, that's right, well, I don't know. But, in a way, the LCC, I think, [inaudible 00:23:34] but it seems that it should be part of the process. I'd be taking the view that, look, I don't want to get married to you. Anyone who wants to jump it, usually there is a bit of a dating process. If they just want to sign up for design and pay you $10,000, you probably just take their money and get on with it. But, generally speaking, you're probably better off if you do some research up front. And they're certainly better off if you do some research up front. Richard: It's probably better for everybody if there is a little bit of a ... You still have a client, don't forget, they have become a client, but I just think it's better for everybody if they do go through the step, because they reduce risk, you get a chance to look at the project, and everybody gets a chance to make sure you're getting on okay. You're not saying, "Well, let's not become clients and let's get on with it." All you're saying is the best practice is, one, if we do this. If they want to hire you for design, great, but the first part of design is to do the analysis. So you might sign them up for the whole amount, but you might still to some sort of pre-design analysis as part of it. Erick: Right, right. I was thinking sort of the same thing, that it's valuable to present, as a discrete piece, regardless, because it is, actually, a good process, an opportunity to, in a fairly concise amount of time in the beginning of the project just do that full look at it in a short period of time. Generally, when I do these, I'm just taking a day or two, doing the zoning research, and I will often do a couple of little sketch doodles, sort of like what you just showed, from the Mitchison example. And that's not a bad thing to incorporate into the full services as well. Richard: Yes, and I'd bet that there'd be some projects in the past where you'd gone into design and had got into it quite quickly, and then gone, "I wish I knew about this before I got to this point. I wish." Erick: Never, never, never, no. Richard: Well, not you, but I'm taking about Marcus Marino, really, and other people like that. Erick: Of course, of course. Richard: Andy Jessup and Alan Goldstein and Greg Croft, those guys. A little bit more reckless. So, and you just like, "It would have been better for me if we'd actually done a wee bit of research, and I have just been forced to dive into this thing. Richard: And I suppose, going back to relationships, if you end up going through a drive-thru, you meet some nice person at Las Vegas, Bellagio Casino, and you decide to go and get married, there's probably a fear chance that, three months later, you're going to go, "I wish I hadn't made quite so many assumptions. I wish I had known a couple of these things about that other person before we got to this point." Erick: Thank you so much. Yeah, all that's useful. The only thing I'd add in as well, is that, as I've been looking at the videos, and I'm not through all of them, yet, for this module, but as I've been looking at them, it actually has helped me to think about how to hone our actual design process, and delineate the pieces, and explain them better, whether they're done separately, as an LCC, or done as part of a bigger full design process. But it's useful to go through this mental exercise, seems to me, regardless of which direction it goes. Richard: Yeah, and I think one final key point, but I think one of the key things with the LCC is it's as much a mindset as it is a strategy or method or technique. It's a mindset thing. And what it does, I think is puts the architect who's doing this, who believes in the value of this step, or separating the step out, or doing it first, you've got to believe in it yourself. So you've got to take on board yourself first, the value of doing this step. You've got to really understand that it is about reducing assumptions, it is about reducing risk. Risk, whether it's ... So it's a mindset thing that you've got to believe in, first, before you can sell it. And that's why, just watching some of these videos and things like that, I think you adopt some of the beliefs around this. Richard: Because I truly believe that it, that it is a good step, for everybody. Reduces risk around time, reduces risk around cost, reduces risk around starting and doing the third-best design, and reduces the risk around the relationship between the two parties, because you get to know each other. String: And I think even if you adopt this as ... It is an LCC, but if it's part of a proposal, imagine you have this as your proposal, and the fee across it, but it explains the process, it's a bigger brief, it's a more detailed brief, and it shows the risk and the pitfalls that can go, that other architects might not bring out in the open. You have a brief, that tell you, "This is all the things that we'll do." Whereas this here goes [inaudible 00:30:00], and these are either of the other things that we need to look out for. So it's a well-crafted brief, and, because it's work involved in it, and why not charge for it? Richard: But you need your good stories. You need the stories like Enoch gave, and you need a swag of stories that you can pull out, because once you've heard a few stories, you're going, "Oh, if I go ahead, having heard all the disasters that can happen if you don't do your research up front. If those fail, then I'm going to be an idiot. Enoch: Yeah, and this is so important, like Richard said, from just the psychological aspect. So, just to in a larger sense, here, I'm curious if anyone on the call has ever had a client who came in thinking they were the architect. And that sounds like, part of what you're asking, Erick, is yeah, they kind of feel that they know what they want. They know where they want it. And all clients are this way. They all come in, and they all think they know exactly what they want. All it takes is one little story to illustrate the flaw there. So part of this LCC is actually reeducating them. That's another reason why it's important, is to reeducate them and to reposition, "Okay, I'm the architect, you're the client. And this is just a nice way for me to say that, hey, some of your ideas just don't work, and I have better ideas because I'm the architect." So that's another way to think about it. Enoch: And I'm sure you have the stories, if you could just write those down in a notebook somewhere, brainstorm those, and try using them to explain, because, like I said, once again, you're not inventing something that's false, you're not trying to sell them something they don't need, but you're illustrating a really true principle, and you're going to do that with stories. Enoch: One just quick example would be a developer that came into our firm when I was in Texas, he had a plot plan laid out along the inter-coastal highway; he wanted to sell these luxury fishing villas. We looked at it. There was this piece of land that he wasn't using because it was a levee that ran across the backs of the property. Well, we ended up talking to the Army Corps of Engineers; we ended up being able to use that land up there. And instead of just having houses that were blocked by that piece of land, we were able to put them up on top, and we almost doubled the ROI for that entire development. Because now, he, instead of having this leftover land, he had these houses that he could sell for twice as much, because they were elevated, and they looked over, and had water views and coastal views. Enoch: And so what you could say is, "Well, what would've happened if we would've just gone with the recommendation that he came in with, that he had laid out from his engineers, with all the land?" Instead, we took him through this process of identifying the needs and options, and we doubled his return on investment. No client in their right mind's going to say, "Aw, that's silly, I want to save that $1,000, $1500." Richard: I've just had an idea, and I wonder if this would be useful to people. But if we had a series of videos called "Fools Rush In ..." and then we had members of the academy, each architect, or anyone who had stories, was to submit a 60-second video of them telling a story of where someone rushed in to design before doing research, and they tell their best couple of stories. So let's say we have ten really good stories, we put them together in a little ten-minute video called "Fools Rush In ..." and then make that available to the academy members as a resource saying, "Look, hey, there's a resource that supports that the value of the low commitment consultation, there's no quicker way to do it then tell ten quick one-minute stories. And they could be from architects from around the world." Not laughing, but almost going, "These people wanted to rush in, and here's the horror story I saw. Not with me, but that's ..." What do you think? Enoch: I think that's an excellent exercise. So if you have a story like that, please send it in, let us know. Just drop an email to support@architectsmarketing, and what we can do is that can help us create, perhaps, some sort of resource that you can then use in your practice, maybe by pulling out some of the most interesting stories. Perhaps it becomes part of a brochure that you hand out to clients on the undertone is the value of working with an architect, but what it says is like, "Hey, here's some valuable information that's going to help you in your project." But the whole thing is an educational piece to help them see what the value of this diagnosis. Richard: Well, and the quickest way, I think, to explain the value of doing this step is by showing people what could go wrong when you don't do this step. So that's where the whole "Fools Rush In". Basically, what we're saying is, "Fools rush in if you don't do the LCC step." We're not saying that exactly, but the stories, if we could collect. So what we'll do is we'll send out some emails. I'm sure everyone's got a 60-second story. But if we can collect ten, if we get ten 60-second stories that talk about people who have skipped the step, and the disaster that happened, we can put them together and create another little video that could be part of your follow-up sequence on your website, or like you say, we could even maybe write them up, put them into just a little storybook that you could print out and give to people. Very powerful. Enoch: Alright, so Erick, thanks for being on the line with us, and thanks for ... We went on a little bit long with this question, but I think it was valuable just because it seemed like we touched on a lot of the different aspects of the LCC that are going to supplement the training that's already in there. Let's see what else we've got. Thank you, Erik. WHat's our next question, String? String: Sorry, I can't see the questions, because I've got recording. Richard: Okay, so there's a few questions about your house, Enoch, that you're in. So did they orient the house correctly for the climate? It appears not. Mark Siddle says- Enoch: I was wondering. I can see the chat comments, but I was wondering if, do we have any other questions that are lined up, that people sent in ahead of-? String: No, there weren't, no. Enoch: Okay. Well, it's been, thank you everyone for joining us today. You can always reach us at support@architectsmarketing ... No, I'm just kidding, I'm just kidding. We do have a little bit more time, here, so if you do have questions, or thoughts about that LCC, drop it into the chat box, because we can answer those right now. Richard: Justin Smith's is "Ha, ha, most of mine think they're the world's best property developer. Yeah, that's right. And that's why, if you had a series of stories about our property developers who thought they were, and some things that went wrong because they jumped in too quickly. Obviously, if you can tailor it for the market. They'll see those, and not see themselves in an indirect way." Course, everybody in the world's got two jobs: their own and architecture. That's the beauty, they get to help you out with your architecture design, because we are experts in architecture and design. We live in it. We understand it, certainly. Why wouldn't we help you out? Richard: I'm rebranding just another business, and doing a bit of design. I've done exactly the same thing. I've come up with a little design on my PowerPoint spreadsheet with a few things I like. And I've sent it off to [00:38:09 Yvonna]. And she's probably looking at it going on like, "He's sending me his design that he wants me to ... He's already marked it up. How do I type this up? So that's the problem, that's the problem. My sister actually countered me. She said, "Everyone's got two jobs: their own job and advertising." She was in advertising. And it was the same with architecture, isn't it? String: I'm not sure if you guys will be able to see if we've got Randy Coddington or Ian has the email one. If we got either of those or even Bruce Mitchison to talk about their experience of selling it, and also the delivery of it. So we got Bruce's example here of delivering it. [inaudible 00:38:55] say delivering it but I can't say, can you guys check if they're online? And if they're okay to say hello? String: I can't- Enoch: While Richard's looking at that, there is one other thing I wanted to mention here, just about the LCC in general terms. So, at the end, Erick, you asked us, "Okay, what happens if I have a client that comes in and they're ready to rumble? Is there really a purpose just to put them through this LCC step?" And I would say, not as a separate piece, but if you think about one thing that I'm a big fan of is bundling your services into turning them into products, which is basically what an LCC is. If you go through the training, you'll see how to do that. But the idea that your different phases are broken up, and it's pretty easy on your proposal if you feel they are ready to go, then to have that LCC as a separate part that's a mandatory part that you include, that other architects don't include, and here are the benefits of it. And then, they'll pay the fee, and then here's the fee. Or perhaps it's debited from the fee. You could work that out yourself. Enoch: But the idea that, if it comes down to it, and a client has maybe three proposals that they're looking at. If yours is different because it has this separate service, that's outlined very clearly, that talks about how it reduces risks, how it adds a whole lot of value, other architects are ... All of us, as architects, are probably already doing a lot of those services as we go through the design process, but we're just not selling it very well. So what the LCC does is you're selling it well because you're talking about this value, you're including those stories, and that differentiates you. So if you just imagine your client, potential clients, looking at these three different proposals, here, well, no longer can they compare apples to apples. That's what you want to avoid, because that leads to price-shopping. Enoch: If a COACH bag is exactly like the bag that I found at Target, then shoot, game over, I'm going to Target. But Gucci or COACH, they have, it's a status symbol. When I walk down the street, my wife, I mean. Sorry, I don't use purses. But my wife walks down the street with one of those purses, because it's different, that's where the value comes into it. Enoch: And so, to answer that, even if a client comes in, and I know they're ready to go, I'm going to make sure that my proposal is different, and it's clear, and it has this LCC included in it at the top. And if they want the option to break it out separately, because they don't want to commit, then that option is there as well. Enoch: Yeah, yeah, Erick says, "An interesting way to put it might be to describe we always start our projects with this research evaluation process." Yes, exactly. So that's the diagnosis. Richard used the example of an irresponsible doctor gives a prescription without diagnosing. That's exactly what we want to avoid doing. So you need to make clear that, in your proposal, "Look, we feel it's not ethical or whatever, it's not to our professional standards to issue a design solution without going through the step. And so, this is mandatory; if you want to work with us, you have to go through the step." It does a lot of things. It positions you as more of an expert rather than someone who's just doing some plans. So there are quite a lot of benefits to it. Yeah, Mark says malpractice, exactly. That's what it would be. In the doctor world, it would be malpractice, and yet, in the architecture world, we're not so clear about that. The medical profession's definitely has us all trained so when that guy in that white lab coat walks in, we're happy puppies. We're going to do whatever he says. Although that, too, is changing. String: We had this discussion in Vegas where the question was brought up, well, do I have to do an LCC if it's a referral, because we have the job, a lot of the time, is almost guaranteed? So that was a pretty good discussion. I think everyone contributed. And my takeaway, there, was it's still worthwhile to do it, even if you don't charge for it. If it's a strong referral, I'll let them know that it's part of the process, so if they do refer you, you still take them through the process, they can experience it. String: And when they do refer you, they understand that they may have gotten it without charge, if you choose not to, but let them know, "Hey, if you're a friend, you're a friend of this person, and we really respect them, usually we charge for this, here, but we know we're going ahead with the project, so we're going to take this fee off." String: If you do decide not to charge for it, and you could if you know, the deal's done, but let them know that there's a value assigned. Because if you don't let them know, they won't know, because other architects aren't separating this, and they're also not doing the exact thing that you're doing. Richard: It's a selling feature. It's a differentiator. And it's an expert-builder. It's certainly good things rolled into one. It's like the Nutri-Ninja;. So many good features rolled into one blender. Now- Enoch: Have you been watching late-late-night infomercials again? Richard: I've bought one the other day. I've bought one the other day. Unlike other blenders, where all the goodness gets squeezed out in the pulp, the Nutri-Ninja, with it's double-pulsing action, blends it all up and keeps it all within the cup. So my health and vitality has never been stronger. It actually is quite good, I actually- Enoch: That explains the color of your skin. Richard: ... bought one off the TV infomercial. And I got one of those fry pans that don't stick as a bonus. And when I said I'll pay it all in one go, because it's, I think, around $150, I don't think I really need a payment plan, I said, "But do I get a discount on that?' And they said, "Well, we can give you some extra steak knives." So, and that's another weird thing is you don't have to discount. What you do is you just load up a bonus, like, "We'll give you something else." And as long as I felt I got a good deal, then I was happy with that. Here we go. Richard: [inaudible 00:45:52] Yousef asks, what's the average cost that architects in the academy are charging? I would say the average would be between 750 and 1500. I know Ian charged 2,000 from just sending out an email to someone, and they said, "Yes." I know Kathy Coler's done a couple for 3 or 4,000. I know Dion- String: Maybe we should ask members just type in what do you charge per average, and what's the highest you've charged? Say your average and then the highest. It's not public. We'll just read it out. I can't see the chat, but if you guys could just say, it'll be good to know. Richard: Yep, and while you're doing that, I just want to say that I haven't heard much from Craig Teller recently. And Craig's based in Sydney, and he's a King's Sports fan. His Australian cricket team have just toured England. One of the most unceremonious tour. And Craig's gone very quiet on me recently. I used to hear quite a few emails talking about sports or what was going on, particularly when Australia was doing well. And haven't heard from Craig for a while, and I thought it's a little sad. Now's the time I actually want to hear from him. So maybe we could get in the line. Enoch: Justin Jessup from England says 500 pounds. Don says for residential- String: I'm sorry, continue, sorry. Enoch: Don says highest is 3800, lowest is 1500. Marcus: as for homes, 1500; for residential development, up to 15 units, 15,000. And Greg says, "I haven't done any yet. I'm planning on doing 500 per residential and 1200 for a commercial." Stefan says, 799 without trouble. Andy says, 850 to 1500 depending on level of involvement. I think we have a good feel for it there. String: We don't have anyone at the 750 level. Everyone's higher. Enoch: Yep. Richard: It seems to me, it doesn't come down to the number; it comes down to your justification for doing it. That's the key factor. The 750 or 1500 or 3,000, the number isn't the factor. It's the value that you've established by justifying the value to them, how much better off they're going to be by doing it. Richard: And, intellectually, I mean, honestly, let's all have them think about it, but if you do some research up front, reduce assumptions, reduce their risk around cost, reduce their risk around time, have a look at some of the options for design, and actually come up with the best option as opposed to the third-best option for design, and allow you both to have a chance to meet and greet, and make sure you understand how you're going to work together -- all those factors, if you load them all up, could that be worth tens of thousands of dollars saved or improved design, or faster speed. Richard: Because, honestly, have a gut check, if you do the research and analysis up front, could that reduce the cost or improve the design by tens or hundreds of thousands of dollars for your client? Well, if you believe it, and you can put that across to the client, and they believe it, then the initial fee is not really a factor, because the swing, on either the upside or the downside if they don't do it is the factor. That number is so large, whatever little number you throw up front, 1500, or 700, or 3,000, is insignificant in comparison to risk on this side or the benefit to be gained on that side. And that's how you've got to think about it because that's the truth. That is the truth. We're not making this up; that is the truth. That the pros and cons of the benefits, or the costs at the other end if it's not done are so big, that your fee is inconsequential. Enoch: So one thing to keep in mind. You're trying this out and it's not working, then you need to reevaluate how you're selling it. You need to take a step back, and you need to take a look again at the problems you've identified that you're solving. If you can add to them or change them because they're obviously not working. Richard: If you are going to charge for it, 750 is not enough says Samuel. I sort of agree. I think if you've got in your head, but step one with this thing is you've got to understand the value of doing this properly in your own head first. That's step one. Step two is then, one of the words that, like how am I going to communicate that to a client. That's step two. And step three is just do it. String: I'm just pulling up this worksheet, the LCC worksheet. So if you haven't downloaded it yet, it's the video, it's called "Creating Your LCC Offer". I think it's the fourth or fifth video in the series after the incoming call script. And it looks like this. It's a good exercise. Watch the videos first, where Richard explains it, and then watch this video, here, where you name the LCC, what the problem is, what promise you'll solve, and the process and the price. So it's all there, have a look at it. And we try to make it as simple as possible, so you can do it on a one sheet. Richard: Yeah. All right, let's go back to the difference between you doing this exercise well, and some other architect doing it badly or not doing it. The difference between the two outcomes is potentially huge. It's really big. So keep that very close in your mind, and in your heart as you're thinking this fee, and as you're thinking about how to explain it. Richard: It used to stop everybody here, too, by the way. We've got the incoming call script. We've got the video that Enoch's cut. You can cut your own version using the same script, but it's pretty compelling script, and we go through this, we explain the value of doing it and not doing it in those videos that you can use. You can just send people a link to the video, or you can just check in the back. So we've done a pretty good job of justifying it for you. Obviously, you need to own it, here in your own heart. Enoch: Erick, here, says, "Sometimes multi-family developers are willing to pay for an initial process just to factor in something realistic in the pro forma calculations. The bonus is that we get our foot in the door. And here's the key, I've wound up not getting projects after the capacity study, but each time, I had the time to see how they behaved through this short process, and each time I felt like I dodged a bullet by not getting the project." Enoch: Philip asks, "If you're trying to sell an LCC to a client, and you have indicated a fee for the LCC, but the clients keep coming back and asking for a fee for the whole project, at what stage in the LCC process do you commit to providing a fee for the whole project? Richard: When you've done the diagnosis, I suppose. Let's just go back to a surgeon. And if I go into a surgeon and go, "Listen, I've got pain in my brain, and can you operate? And here, I've got a $10,000 budget for the operation. Can you cut me a deal on this?" The surgeon's going to kick you out of the office. He says, "Oh, I can't afford to start operating on you. I haven't even looked at you yet. There might be a problem with something else." No surgeon would give a price or even pull out, pick up the knife without having done a proper diagnosis. So the answer is "When can I give you a price for that? I can only give you an estimation, a ballpark estimation, but even that might be wrong." And in fact, no surgeon, if I'm a surgeon, it's irresponsible for me to be able to say that before I've done a proper diagnosis. And any surgeon that gives you a price is really only giving you a very rough indication, because once we get inside your brain, Mr. Petrie, we may find that it's not set up like anyone else's. Richard: There's these genius cells running all over your head which I've never seen before. Enoch: Marcus said, after the scope is determined. That's really the short answer, which is what Richard also said, which is, "Hey, the only way we're going to get to understand the scope." Now, earlier, I think it was Erick in one of his comments, he did say if everyone's charging the same, like everyone's charging a percentage of the construction, and they just say, "Okay, boom, house. Yeah, I do a house for 12% of construction cost, and that's just what it is, then the scenario might change a little bit. Richard: Well, Dan Candy would argue that's even more reason to go on a completely different angle. Enoch: Yep, I know, I agree. Richard: Because then they've got two options. They've got everybody offering a percentage, and they've got you using a different process. And you're the only one on that side, so there's two sides. Do we go with percentage? Or do we go with this guy over here, who's doing it completely different from everyone. Now, you've got a 50-50 chance. But everybody packed in here, that says, "Four in here, we're offering the same thing," they've got a 25% chance of the 50%. So I like 50 rather than a quarter of 50, which is probably about 13%, 12 and a half, probably. String: What I'd ask is if we've got a list of members, here, who have put in their price. I think if it helped the members who haven't offered an LCC or sold an LCC, to bring someone on and just take us through the process, what happens. Do a short little hot seat, three minute hot seat, what happened in the first one, even if you failed, what mistakes did you make and how did you sell it? So do we have any volunteers? Or Enoch or Richard, just pick someone and check if they have a microphone. Richard: Well, Don Schlening was the last one to make a comment. He says, "A roadie's a technician who sets up and tears down the equipment for the musicians. Experience from my career 37 years ago." Enoch: That is completely irrelevant, Richard. I can't believe you completely read that out. That was a private message that Don made way back in the beginning of the thing, I just asked him what a roadie is. That's completely irrelevant. But let's see if Don has done a LCC. I think that is valuable. If one of you has done that and wants to get up here and we cam ask you some questions about how it went, about the process, drop your name in there. I don't want to put anyone on the spot if they're not prepared to do that. Richard: He's quite prepared to put Don on the spot. Go on, roadie. String: Okay, we'll call- Enoch: He says he's game because I'm here. Richard: Were you a roadie or were you a musician, Don? That's what I want to know. Enoch: Alright Don, I'm going to unmute your mic, here. String: I've unmuted Don. Enoch: Okay, I think I just muted him. Okay, hold on. We both did it at the same time. Don, are you there. Don: Okay, I am. Don is a musician. Richard: You were a musician, Don. Don: However, I use the term loosely. But at some point, I had to make a decision is whether I was going the musician route or the architect route, and this is one of the good stories, Richard. A good friend of mine was assistant professor at the music college in Lincoln, and after a semester toward the end, when I was getting A's in my architecture classes and D's in my music classes, he said, "I'm going to give you a C and pass you out of this. But you have to sign this form that you will never take a music course again." Don: So, therefore, I got rid of the idea I was going to be a musician, needed roadies, and went over into this fine field. Richard: Well, it's a funny thing, isn't it. Because if, say, Mick Jagger was at music school, and he wasn't famous. And he was singing away, just singing there without his gyrations. And he also took a dancing class. What mark do you think he would get for singing? And what mark do you think he would get for dancing? Don: They just didn't understand his capabilities. Richard: I think you and Mick Jagger have been seriously misunderstood, and it's time to restart that music career. Don: Well, I still keep the guitar around, I've been ... Richard: Here we go. Don: Yeah, yeah,. I have done some LCCs. And my experience has been you have to have probably enough experience to look at the condition as the prospect and say, "What do they need? And what are they willing to pay for that expertise? Don: Years ago, I had a woman from Germany, who moved to Nebraska And her husband was less than capable around the house. And they had bought this new house, and she asked around why her windows kept leaking. And someone that I knew called me and said, "This woman needs some help." So I stopped by, and she actually had been told by this reference that I might stop by, and she had it all prepared. She needed my expertise. And that started this whole thing, was, for me, I never did an LCC in this fashion, but I did this without it being formalized. And if it's a formalized part of it, has really felt polished, that, in a form, and within a process. So she took this report that I did, which was just a one page, and indicated all the things that were wrong: the bin drainage was bad, the connections had not been caulked and sealed, and there was no drain in the bottom of the window well. Don: So that was where I started doing that process of, "What do they need? What's her problem" Or, "How can I solve it? And how can I make good money doing that?" So I've done these for years, but never in a polished and professional sense like this where they'd get something that says, "Here's what you'll get, and here's what I'm going to be paid for." Richard: So have you sold a few, now? Don: I think I'm up to my sixth actual, where it was a formal form, and I've used Enoch's, with the blue page, I've used that one four times, and then I've done one where it's just a very short, like a page and a half, without any extra color, just almost like it was a couple of horror stories that I gave someone and said, "Here's some things that you might get into if you don't do this." Don: And one of them was my brother-in-law bought a house, and he was getting $500-a-month water bills in a rural water district. And he couldn't figure out why his water bills were three times that from his office building. So he called the plumber, and the plumber came out and said, "Well, this meter's spinning around so fast that you can't believe that it should be doing that." And then they went and dug up a place in the floor. It was the wrong type of water line. And they hadn't had it inspected. And they didn't have anyone overseeing the work of the builder. So that is usually my horror story because he's getting $500-a-year plumbing, or $500-a-month water bills, and, in the last couple of years, he's just replaced about two-thirds of his basement floor, because now that it finally dried out, our clay, in Nebraska, is allowing it to sink and break up. So there were the monthly cost, and then there was the replacement cost. So that's one of my war stories. Richard: Wow, that's good. And you can say, "Look, that's just one of 10,000 things. None of these ... It's like the human body, isn't it? You don't notice a body part or a muscle until it's not working properly. And there's lots of them. And we take all these things for granted in a project, but if one thing goes wrong, and it may be as simple as a water pipe, that can potentially cost $500 a month. Don: It will pay for your fee. Richard: Yeah, yeah. Don: Just what you can catch once. Enoch: Don, what are you offering right now as your LCC? What is the offer you're making? Don: It's not a specific one. It's more with just a quick phone conversation. I asked a few questions, and sometimes it's the seven, or whatever they are now. "Do you have financing? Do you have property? Do you have any idea of what you want this building to look like?" You start some of these probing questions, and it becomes pretty clear, within about five, ten minutes or so, that they either have things together, or they have a lot of holes, and then I just tailor the LCC to what their needs are, not what my needs are. It takes a little more work, but it's- Enoch: Great, so it sounds like you're doing it on the fly as you talk to them as part of the sales process. Those architects, whenever we talk to people on the phone, we can pretty quickly where the gaps are, and it sounds like you're just basically feeding those back to them and saying, "Hey, I can help you remove some of this risk, and here's my LCC product." Is that a sales pitch? Don: Pretty much it, but what I would say that helped, I think, define the process for me is I keep going back to your form, Enoch. Because it kind of hits, even if it is not real in depth, it still has a layout and a format that anyone can look at and, go, "Okay, it keeps you on target I guess. Yeah, there you go." And you can change all those things to what you want, or you can redefine. But I think keeping it succinct and short, so that you get it within the first 60 seconds is really a key to it. Enoch: Yep, great. Don: And I think the picture of, has helped because once they've gotten one of these, you just get a real strong sense of how they feel more at ease. Enoch: Yeah, are you talking about the actual photograph, the headshot? Don: Yes, yep. Enoch: Yeah, I think that's so important. Like have your headshot there so they can ... Yeah, it totally makes you seem like a person if they've never met you before. Sure, so you found that that's been useful. Don: Yeah, definitely is. Enoch: Okay. Don: And, Richard, I haven't done it, the job site sign yet, but I'm close. If you want to building like this, call Don. We're getting ready to do that one. Richard: Yeah, because, I think if you think about it, who's going to be looking at the building. Anyone who's considering something similar, is going to have a look at that building as they drive past, aren't they? Don: Yes. Richard: So, in a way, it's eye bait, for, probably a lot of people. Particularly, it's eye bait for people who are considering some type of project. Because they're always going to have a little poke around and a look, how are they doing it and what are they doing? So a site sign's a good idea. Enoch: All right, thanks, Don, for volunteering- Don: You're welcome. Enoch: ... to share experience with us. Don: Sure. Richard: Yeah, thanks, Don. String: And you'll find Enoch's LCC in the vault. I'll upload that in the next 24 hours, if you want to have a look at it. And just to expand with the last one, there's a lot of questions, here in the incoming call script, which is in the quick start section, and also, in this LCC module. There's a whole heap of questions here that you can refer to, to ask whether you're on the phone or in person. So go grab the incoming call script. Richard: And those called, "strip naked questions", they're designed to make the person feel that they're unprepared and haven't covered their bases. So by the time they get through those seven or eight questions, they're going to go, "Oh, I don't know, I don't know, I don't know." Which is, in their own head, they're going to go, "Holy cow!" Because your final sentence is that, "Don't worry about not being able to answer all these questions. The needs and options review, or whatever you're going to call it, the needs and options review will help us fill in the gaps on all those answers. So that before we go to design phase, we've got everything covered. And we're well prepared. Enoch: Erick asks, "I'd like to know how many members who do the LCC give people an example of a previous one to show what to expect?" So if you do that, drop that in the chat box. That's definitely a practice I'd like to follow. Enoch: Steven asks, "How can we address construction budget at LCC stage without losing too many prospects? There's a lot of misleading information around, not least for builders about building costs. You want to know if a prospect can afford what they want to build, but I've recently lost a couple of good clients when they've discovered what realistic construction costs are." Richard: Yeah, I think, because I used to do this with builders, and they have the same problem: that the people have unrealistic expectations around the price of a build, and the answer is, you give them indicative pricing very, very early on. Because that's one thing, that's what they're interested in. They're all thinking that in their head, even if they don't say it. So you give it early on before you've invested too much time and effort. So they've got a chance to get their head around it. Richard: And one way that a very clever builder did it is he would lay out certain types. So, if he was building homes, he would lay out three different type levels of homes, so a very cheap one, a medium one, and a high one. I think he only did three. For this, he stayed at three. Now, he put them down, and he'd have the price underneath each one. This one costs this, this one costs this, this one costs this. Which level of house do you see yourself wanting? Now, they're building a whole house, from scratch. And they would go, "Oh, probably this one, here." And so, it was a way for them to get their head around what it really costs. But also, he could find out what bracket they're fitting into. Because they would pick a bracket, and a price range, that they were comfortable with. Richard: If they said, "Aw, all of them are too expensive," well, it's better that you know that early then find out after you've spent three weeks of phone calls and site visits and ... You might as well get that out up front, so either they've got a chance to get their head around it and come to terms with it, or you save yourself some time. Richard: So what does Justin say? Justin says- Enoch: So, there's another ... Go ahead, and read that. Richard: I was going to say, Justin's view is, "If they came in with unrealistic expectations, and do not want to take advice, that they are unrealistic, then they're not a client worth taking." Yep, that would probably be correct. And the sooner you know that, the better. I don't think you need to muck around with getting dollar figures and budgets out of people. I think, get into that very quickly, because it's what they're thinking. It's what they want covered early as well. "Do I have the budget? Roughly, what is it going to cost for this thing, and do I have the budget for it?" You're not doing them a favor by delaying that conversation into the second or third meeting. You might as well put it right on the table, right up front, while no one feels like you've stepped on each other's toes. It's a very valid question, for you and for them. Enoch: So I had an experience, recently, that kind of ties into that. This is something we deal with constantly, is clients coming in with unrealistic budget expectations. Interestingly enough, on this side, I was on the flip side. So in this particular instance, a client was coming to me, and they had been working with another architect, and the other architect was telling them that their budget expectations were not valid. So he was telling them, "You guys are way over budget. You can't do that." So they would want to be adding stuff to the project, and he would just say, "Aw, but we can't do that, but we can do this." And he would draw up something that fit his perceived budget. They were very displeased with that situation. Enoch: So, I just want to warn you all, don't be that architect, because there is the potential there that these are good clients. So let me tell you the background here. So this is a local nonprofit. They're a food bank. And they get some funds from the county. They get national grants and stuff. But what they really wanted, they didn't mind designing something on a budget. Because the way that they wanted to sell the project to get funds and get donations to build the project, was to have a completed design that showed the vision of what they wanted. Does that make sense? So they wanted something that was sexy. They wanted something that looked nice, to get their donors at their annual fundraising drive to really get their glands going and pull out their wallet books, and contribute to the project. Enoch: And so that was something that this architect, bless his heart, I know him, he's a great guy. He was in architect mode. He was thinking with his architect hat on, "Well, this just won't work because you don't have the funds." And the fact is they didn't. However, they came to me, and what I did, and nothing spectacular, I basically did a couple of designs for them that were kind of sexy. I had some renderings done that showed the vision of what the project could be. And then they used that as marketing materials. And they were very happy with that, very pleased. And now, they're coming back to me with additional projects. Enoch: So, just from the architectural side of things, if you can help the client catch the vision, if they're saying that they want to keep adding stuff, and that you're having that budget problem, there may be some underlying thing there that you're not understanding as the architect. And undercovering that and being able to get through that can help you out sometimes. Enoch: So I just mentioned that. It was interesting being on the flip side of that. Where I usually am, the architect's saying, "Aw, man, this is so out of budget, you guys can't afford it. I can't believe you're making me do this. You're going to come back in six months and say, 'Enoch, why'd you design it out of budget?' These architects have the gold-plated pens." It was interesting, in this time, to be able to be the second architect. We've probably all been the first architect. I know I have. And I've also been the second architect. And, at the same time, I'm telling them, I was backing up the first architect. I was telling them, "Well, he's completely right. That stuff is out of your budget." But he just wasn't addressing their real concern, which was the fact that, as odd as it sounds, they didn't care about their budget, they wanted something that was going to capture some vision. Enoch: So that was quite the tangent there, quite the riff. But hopefully that helps someone out. Richard: [inaudible 01:17:06] you've been quiet today. Enoch: Let's say it looks like the questions have died down, here, gentlemen. Enoch: Yeah, we generally leave about 90 minutes for these, but we try to keep them to 60 minutes if possible. And unless anyone else has any burning questions, then let's do it. Enoch: Marcus said, "Wouldn't LCC have determined that they were looking for that?" Yeah, absolutely, totally could have undercovered that. That's a good point, Marcus. Spoken like a true architect marketing veteran. Richard: All right, shall we wrap up? Enoch: Yep, yep, Erick. There was no response to the question about how many show an example of an LCC. We didn't get any responses on that. Justin just added in here, "Oh, client not working with 1500 pounds, square meter for cheap build, 2,000 pounds per square meter for standard build, and 2500 pounds, square meter, plus, for a good build. I heard a story about someone who's in the process of building a new house, and they had an architect visit them, who said, "What do you have to spend?" Then, when they said, showed them two houses: a fabulous house they wanted, at 2500 pounds per square meter, and B, a small one, within their budget costs, of 1500 per meter square. Enoch: Well, a lot of times, yeah, you've got to speak their language. They speak in pictures, so that's a good point also. Enoch: All right, gentleman, well, it's been a great call, and thank you, everyone, for joining us today. Once again, you can always find these Q&A sessions on the actual modules and go there for the additional details on the members' website. Richard: See you all. Have a good week. Okay. |
OVERVIEW
This is the recording of the live Q&A session specifically dealing with the LCC. Listen in as we answer questions you might be wanting to ask.
If you have questions not covered then submit your question on the slack general channel. and turn up to the weekly Q&A sessions and ask Richard or Eric.