Helping Architects Get Paid

1. Plan your invoices in advance and most importantly track and chase them once submitted. If not done already, make someone within the practice responsible for it. Seems obvious? We know of a major practice that nearly went bust a couple of years ago through taking their eye off the ball.
2. Form a relationship with the person in your Client’s finance department. This means not just sending emails but giving them a call at fixed points (just prior to due date, after 5 days, 15 days etc). Put your practice to the front of the queue and above all, keep your cool.
3. It is easy for Clients to say that they cannot pay you because your appointment is not in place. Ask your Client for a Letter of Intent to bridge this period and formalise your start date, amount due during this interim period and when it will end.
4. Your appointment should include the invoice amount and frequency. Most importantly, it should be clear what triggers payment. Is it a set of deliverables or completion of a specific milestone? Don’t give a Client the opportunity to come back with ‘I was expecting a bit more’ as a means to delay payment. Say what you are going to do and then do it.
5. A simple progress report – typically issued monthly – provides practices with a written opportunity to clarify what has been completed each month and most importantly can be referred back to in the event of a dispute over progress made.
6. Sometimes it seems that the most popular period to ask for additional work is when the money runs out and it’s typically too late. Get ahead of the game and set up early (the process should be defined at least by RIBA Stage 02). Check what’s in your appointment and don’t rely on a Project Manager to set-up. Define a process that puts your needs first and identifies all impacts of change on quality, time and cost, not just to the project but for the Design Team too.
7. Be aware of your responsibilities for cashflow under a Lead Consultant set-up where the Architect appoints the other key disciplines and is responsible for paying them. Payment terms, frequency, extras and exclusions should be clarified under a back to back sub-consultancy agreement. Likewise, make sure there is a sufficient period of time between when you are due to be paid and when payment is to be made to sub-consultants.
8. Another common reason for Clients holding back payment comes at the end of a work stage. It essential for the Lead Designer to understand how cost management is integrated into the process – avoid the time, cost and pain of having to re-visit your design at your own cost before you can get paid.
9. Read and understand your contract to understand where penalties can be applied and plan to avoid them – these could be through the enforcement of KPIs, payment on justification of progress or approvals that can be outside of your control.
10. On overseas projects, watch out for local taxes and retentions. Be realistic about what will and won’t get paid particularly for that tricky final invoice.

Times are going to be tough but hopefully just for the short term. Above all, it’s important to stay positive and get paid the right amount for the design that you complete.