Managing Costs, Prices, and Values in Interior Design Projects

1. Money Pt 1 IDCC PPT 8.0 B Paget & R Hayes

2. Money Damien Hirst - Acetic Anhydride, 1991

3. Money Cost The cost of production (labour, plant, materials) and overheads Price What the purchaser pays- linked to cost but not the same thing ,affected by market conditions Value What’s it worth?

4. Money Cost The cost of production (labour, plant, materials) and overheads Price What the purchaser pays- linked to cost but not the same thing ,affected by market conditions Value What’s it worth? Cost How much to make one? Price What it was sold for Value What’s it now worth?

5. Money Cost The cost of production (labour, plant, materials) and overheads Price What the purchaser pays- linked to cost but not the same thing ,affected by market conditions Value What’s it worth? ‘He also describes another painting assistant who was leaving and asked for one of the paintings. Hirst told her to, "'make one of your own.' And she said, 'No, I want one of yours.' But the only difference, between one painted by her and one of mine, is the money.‘’

6. Money

7. Money • Related to Interior Design and Construction • Cost – Total cost (Shop fitting cost, financing cost, disposal cost) • Price – The amount to pay – including developer’s profit • Value - The least cost for what the client wants – tender process • Issey Miyake shop Stanton Williams London 1999

8. Cost planning • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action – controlling the budget • Scottish Parliament Building, 1998-2004 • Architect Enric Miralles • Estimated at £40million • Actual £414million

9. Cost forecasting • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget • Predicting the cost of a project at an early stage often from limited design information and few, if any drawings…. • Is it worth embarking on the project? • Can the client afford it? • What sort of quality can they expect?

10. Cost forecasting • It’s a waste of time going into to town to buy a Vivienne Westwood shirt if on only have a 120Aed (£20) budget…… • Predicting the cost of a project at an early stage often from limited design information and few, if any drawings…. • Is it worth embarking on the project? • Can the client afford it? • What sort of quality can they expect?

11. Cost forecasting • Topshop v Vivienne Westwood • Shirts range from 22 Aed - 1000’s – what can you afford and what quality do you expect? • Predicting the cost of a project at an early stage often from limited design information and few, if any drawings…. • Is it worth embarking on the project? • Can the client afford it? • What sort of quality can they expect?

12. Cost planning • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget • Confirms any budget already set • Allocates cost between the interior elements to ensure the design develops within the budgetary framework

13. If you were commissioning a dress on a limited budget the price of the material would be a key consideration…. Cost planning • Confirms any budget already set • Allocates cost between the interior elements to ensure the design develops within the budgetary framework

14. Cost checking • A more detailed calculation of cost as the design develops, to check whether or not the developing design is still on target to fall within the original cost forecast/budget • If an element appears to be over target - Remedial action: • Amend elemental design • Amend design of another element • Seek additional budgetary approval

15. Cost checking • A more detailed calculation of cost as the design develops, to check whether or not the developing design is still on target to fall within the original cost forecast/budget • If an element appears to be over target - Remedial action: • Amend elemental design • Amend design of another element • Seek additional budgetary approval

16. Cost checking • A more detailed calculation of cost as the design develops, to check whether or not the developing design is still on target to fall within the original cost forecast/budget • If an element appears to be over target - Remedial action: • Amend elemental design • Amend design of another element • Seek additional budgetary approval

17. Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget • Where are we up to in the project?

18. Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget • Where are we up to in the project?

19. Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget • Green column – forecast based on historic figures • Pink column – actual spend

20. Note - headings on the left – directly from the specification • Note – rate Ft2 or m2 (= sqm) this figure gives an ‘average’ spend per floor area….

21. Exercise 1 • Trip to London • 4 steps • Step 1 – 10-20 mins • What's my budget? • How much money should I put aside for my week in London? • In pairs write your forecast on a post-it – take 10 mins • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget

22. Trip to London • What's your budget? • Probably broke the expenses down?? • Return flights • 7 nights in a hotel • Entertainment – theatre tickets • Eating out • Daily allowance • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget

23. Trip to London • Step 2 – 20 mins • What's your budget? • Return flights • 7 nights in a hotel • Entertainment – theatre tickets • Eating out • Daily allowance • How realistic was your budget? • Work out from the figures a week based on your forecast using figures • See IDCC 7.2 Ex 1.0

24. Trip to London • Step 3 – 20-30 mins • Disaster your budget is cut! • I only have £500 – what are the options? • What will you do? • See IDCC 7.3 Ex 1.1 • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget

25. Trip to London • Step 3 – 20-30 mins • Disaster your budget is cut! • I only have £500 – what are the options? • See IDCC 7.3 Ex 1.1 • Change the quality • Change the amount • Mix quality • Cost Forecasting – Establishing the budget • Cost Planning – Designing to the budget • Cost Checking/remedial action –Controlling the budget

26. Real job • How can we meet the budget – • Value engineering? • Change the quality • Change the amount • Mix quality

27. Questions? IDCC PPT 8.0