Architecture Firm Fee Structures Practice Problem

A conglomerate endeavors to establish itself as a national dry cleaner by purchasing smaller dry cleaners, renovating them to establish brand consistency (similar colors, details, design feel), and then running them as a chain with broad name recognition. It will need an architect to design the renovations; each renovation will have different needs depending on its existing condition and what is required to bring it in line with the store’s standards. Because of this, and because the conglomerate is purchasing boutique dry cleaners at the rate of one every five days, and because the client doesn’t know if they will accelerate, decelerate, or maintain that rate of growth over the next 48 months, the total scope of the project is both unknown and unknowable. Which of the following pay structures would be most appropriate for the architect’s fee structure?

Hourly not-to-exceed
Percentage of construction costs
Stipulated sum

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