Do you charge for engineering? Should you?

Long ago, “engineering” used to be a guy at a drawing table and the guys on the plant floor developing their own material and cut lists. Every once in a while I still find it that way, but it’s the exception when I do, and often only for complex custom work.

Today for most companies engineering is it’s own essential process .. submittals, cut listing, panel optimization, and material ordering. Today’s engineering has saved countless hours in production. Engineering has spawned the departmentalizing of the shop floor and it’s made training new workers easier. CNC couldn’t pay for itself very well without today’s engineering. But today’s engineering, for all it’s greatness doesn’t come cheap.

Many firms are finding that engineering alone can add up to 10% of project costs. This of course, dwarfs the costs of the old model of shop drawings. The costs are especially high when it comes to “non box” or custom work. The upfront time and effort required in designing and part sizing a check desk or nurse’s station or library wall is nothing like box work.

So we’ve added costs to the upfront portion of a project in effort to save that time in building. Where is that cost going? Well, with the understanding that there is no “right or wrong” I still find a lot of clients that have buried that cost into overhead. By it’s nature, overhead averages the cost of engineering into all your projects with the implication being that it’ll all be covered in the end. A lot of this is mindset, since in the past engineering was a smaller part of the whole, and closely tied to all the other office processes like selling and managing.

What’s your thinking on this? Has engineering become a big enough part of the cost that it should be estimated and charged for, just like finishing or installation? Please weigh in ..

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