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CAD and engineering fee split

CAD and engineering fee split

CAD and engineering fee split

(OP)
Hey Everyone,

I use CAD sub-contractors when I need major CAD work done.  On lump sum projects what percentage is for engineering and what is for CAD?  

- Thanks

Eric McDonald, PE
McDonald Structural Engineering, PLLC

RE: CAD and engineering fee split

My experience is it varies greatly from job to job and we usually just figure the number of CAD drawings that will be needed and multiply it by the cost for each.

Unless I am missing the intent of your question, I think you may be asking for problems at some point if you start "factoring" in CAD drawing costs.  You will either assume too much and lose the job or assume too few and........

I would simply ask for a quote on each project.

Greg Lamberson
Consultant - Upstream Energy
Website: www.oil-gas-consulting.com

RE: CAD and engineering fee split

(OP)
Thanks for the feedback, Greg.  In my case I know how to give a competitive lump sum bid that includes CAD - I am just not sure what a fair split is for the engineering and CAD from that lump sum.

Eric McDonald, PE
McDonald Structural Engineering, PLLC

RE: CAD and engineering fee split

McSEpllc

Didn't mean to sound condescending, I suspected that was what you meant, my apologies.

There may be those out there that have that basic split, unfortunately I do not.  I have found a great difference in the split in projects.  Most of my projects are pipeline related, with some facilities and within those the CAD requirements vary widely if it is for DOT work or if FERC/NRB permitting is involved.  

Also, the project financing may impact (i.e. OPIC, World Bank, etc.).   So unfortunately I do not have a clear response.  Sorry.

Greg Lamberson
Consultant - Upstream Energy
Website: www.oil-gas-consulting.com

RE: CAD and engineering fee split

McSEpllc

I am on a business trip, but do have access to a recent project, it was a major pipeline project in the US, comp stations, meter fac, etc.  

It was also a FERC job and the CAD portion on it believe it or not was close to 28% of the engineering estimate.  I am pretty confident that is not the norm but is all I have access to at the moment.

Greg Lamberson
Consultant - Upstream Energy
Website: www.oil-gas-consulting.com

RE: CAD and engineering fee split

(OP)
Hey Greg,

I don't see anything in your feedbacks that I could take offense to  :)

I appreciate the 28% percentage feedback.  From my previous employment I know that most building structural projects had a split of 65% engineering and 35% CAD by taking the hours it took multiplied by hourly rates of $90 for engineering and $65 for CAD.  There are several problems by taking these numbers for gospel:

- For one the liability is entirely on the engineer when the there is separate engineering and CAD entities, while in a joint firm it is carried by both in form of the cost of liability insurance, and lost profit if the firm has to pay for problems in form of paying for repairs and time spent to come to an agreement.

- For another point I am convinced the engineer has more overhead cost.  Both entities have cost in form of computer, plotter and CAD program, which are in my mind minor as that cost spreads over several years use.  The engineer has regular cost that add up: liability insurance, annual licensing fees (in my case three states), membership fee for engineering associations (in my case five associations), the professional development requirement (which is a cost for attending seminars plus the cost of lost billable hours), the cost of codes and reference materials, and the cost of engineering soft wares.

- Finally, one of the constant problems this particular CAD Tech had in the previous office was he did not have enough work so admittedly had to stretch his hours.

It's not easy!  I have a hard time believing that five years of school plus four years of internship plus the liability plus the larger overhead would be reflected in either the $90 / $65 hourly rate or a 65% / 35% fee split.

Eric McDonald, PE
McDonald Structural Engineering, PLLC

RE: CAD and engineering fee split

Eric

Good points.  Also in addition to the overhead burdens you mention, in a pure engineering firm, they are probaby heavier in administrative personnel, quality control, cost & schedule, travel (have to go to the job site), project management, to name a few.

Greg Lamberson
Consultant - Upstream Energy
Website: www.oil-gas-consulting.com

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