CTD 328 EXAM QUESTIONS AND
ANSWERS 100% CORRECT
Job Pricing Includes - ANSWER--scope, services, staff and schedule
-design service outline
-estimating
-evaluate your client
How to Charge? - ANSWER--discuss with the client up front
-laws prohibit price-fixing
-compare several methods
How we arrive at a billing rate? - ANSWER--billing rate is our hourly chart (factors the
staff salary, overhead, and profits)
-in a firm sometimes use a multiplier to calculate the billing rate (often 3x)
-Direct Personnel Expense (DPE) is a person's salary and benefits. Sometimes called
fringe benefits (paying insurance)
___% of the billing rate is direct labor?
___% of the billing rate is indirect, which includes marketing, administration, and
employee supervision - ANSWER-70, 30
Hourly billing rate by total compensation - ANSWER--annual salary plus fringe benefits
(30% of salary) divided by 50 weeks
Percentage off retail fees - ANSWER--more common in office furniture
-similar to retail, except that you advantage is that you r less expensive than your
competition
-can make you design work appear discounted too
A Combo of Fees - ANSWER--most common with a flat rate with a cost plus, or an
hourly with a cost plus
-advantageous when there is a limited amount of furniture purchased
-allows the cost plus to cover a specific line item
*most common
Who r the people in your neighborhood? - ANSWER--manufacturers, jobbers, reps
(people you meet everyday)
Trade Sources - ANSWER--r manufacturers, suppliers, and traders people who provide
various goods and services a designer uses to complete a proj
-trade services can also include: furniture, floorings and paints
, -DO NOT use a source before asking around and investigating
How to Improve Profits - ANSWER--reduce bookkeeping
-estimate for cost increases
-reevaluate fee base
Square Footage Fee - ANSWER--fee based on the size of the project
-more common in commercial
-designer needs experience to calculate easily
-designer can look at previously statically data to determine avg cost per project type
and hours billed
Percentage of Merchandise and Product Service Fees - ANSWER--typically commerical
-fee is based on a negotiated percentage for cost and installation of goods multiplied by
the project's budget
-similar to cost plus method
-disadvantages: cheaply purchased goods, can loose out to another "retailer," client
concerns for "double dipping"
Retail Sales Fee - ANSWER--similar to cost plus but mark up is 100%
-difficult for residential bc you can get shopped
-best if a substantial amount of goods r to be purchased (or you have a store front)
-can discount your actual design work (planning, drafting, spacing, etc)
-mostly now only used for trade goods and fabrics in residential
**stockist (go back)
Setting fees - ANSWER--design concept fee (consultation)
-hourly fee method
-fixed fee method
-cost plus method
-value oriented fees
-per square foot
-percentage of merchandise and product services
-retail sales
-contract price
-combo of methods
Design Consultation Fee - ANSWER--sometimes can just be for input
-normally set at for an amount of time
-no goods r sold
-if a project is then later conducted using previous info, it is sometimes subtracted from
the total cost
Hourly Fees - ANSWER--Based on three kinds [professional level, avg of staff, type of
service]
-more experience, higher the rate (base this off of location as well)
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