11 Jul Business for Architects
No matter the phase you are in your architecture journey, knowledge of business for architects is a must. Whether you are just starting out, or ready to start your own firm, you must have a basic knowledge of business. This journey typically begins with classes in architecture school, but it is never too late to learn it.
Go here if you want to start writing your own Architecture Firm Business Plan!
Architecture school was one of the most exciting yet most tiring phases in my life. Even if you go to the best architecture school, you are still going to get overwhelmed by all of the design studios, architecture history classes and structures formulas. Architecture school takes a lot of effort from students and it is one of the most demanding majors on campus. But through all of this, if you are in architecture school, you should try to find some time to take classes outside of architecture. If you are not an architecture student, find classes through your local community college, or take online courses to get the information you need.
The most important aspect to being a successful architect isn’t design (some might argue with me on this), but it is business savvy. You can be the best designer in the world, but unless you have the firm to get the client and make it a reality, it is just thoughts on paper. Business classes will teach you what you need to know to run a firm, or if that isn’t your plan, to understand why the firm does what it does. You need to know that architecture is a business, and unless you want to be a starving artist, you must treat it as a business.
Introduction to Business
This is the first class you should take as it will give you the basics. What’s the difference between an asset and a liability? Should I be a sole proprietor or LLC? These basics are a must for any business owner to understand and should be second nature to you. Even if you don’t have an interest in running a business, you need to know what you are talking about when you are speaking with an accountant or banker, or even just filing your taxes.
If you want to be successful, you need to follow the money coming in and going out. You need to be able to understand what money you currently have (cash flow), and what you are expecting to have (Accounts Payable/Receivable). When it comes time to buy that new piece of software you need, where is the money going to come from? If you don’t have any cash on hand, how are you going to pay for it? Being able to track your firm’s money makes a huge difference in the success of the company.
A must for anybody, whether you want to run a business or not, as it will teach you the basics of money. It is amazing how many architecture students leave college with little to no knowledge on credit, debt and how to handle money. Don’t be one of these people. Learn how to manage your money properly and stay out of debt. Learn how and when to save any extra money you have in 401k’s, IRA’s or other savings options. This will benefit you in life and not just as an architect.
Once you have taken all of these basic classes, what do you do with it? Your first step is to enhance your personal life, then you will use your knowledge to advance in the firm, finally, if you desire, you will be able to run a firm successfully.
Your first job.
The first thing you will use your new-found knowledge for is to get an understanding of how much money you need to make in your first job. What are your expenses, your current debt load and your repayment plan? Put together a list of everything that is going out and include things like rent, food, and travel. Also include in the list any payments you need to make for debt you incurred during college; such as student loans. Compare this amount to how much money architects make and make sure you can make it work. If your expenses are more than you can possibly make, reduce your expenses by doing things like drinking less Starbucks or even something as drastic as moving to a less expensive area.
Advance in your architecture career
When you are designing a project, basic business and accounting come into play more often than you think. You need it to factor in construction costs to your design, but as you start to manage the projects, you also need to understand internal hourly rates, scheduling and budgeting. When the project begins you should know the amount of time that is allocated for you to work on the project and ensure that you are working within those parameters. If you can show that you understand the need to keep a project on budget, internally and externally, you will show your value to the firm and provide more opportunities for advancement.
Start/run a firm
The most important need for business knowledge in architecture is in running a firm. If you plan on starting your own firm, or even running a firm, now is the best time to start writing your business plan. Seriously. Don’t wait until you are 10 years into your career to start thinking about and imagining what you want your firm to look like. Start thinking about what interests you and what you want your ideal firm to look like. This will give you direction in your career in the type of firms you work for, the architecture project types you will chase and how you go about learning.
Business plans are live documents that are meant to be changed and updated. It’s ok to change your mind and pivot on what you want to do, but if you don’t even have a place to start, you will wander around in your career not knowing what you want to do. I have been dreaming up my ideal architecture firm since I knew I wanted to be an architect and it has helped me stay focused and directed so that I went from an “Introduction to Architecture” class to firm principle in less than 10 years, and you can too, if you just start today.
If you are excited and want to learn more about writing a business plan for architects, I am currently working on my 16-session architecture business plan course that will walk you through step-by-step on how to write your own business plan. At the end of the 16 sessions you will walk away with a business plan geared specifically to your architecture firm that you can take to the bank (literally). If you want to learn more, go to www.architecturebusinessplan.com.