/ BLOG

9 Financial Tips For Architects and Engineers

Dec 13, 2022 · 8 minutes to read

An architect working with his design on a paper

Managing business finances and cash flow is a challenge for many small businesses. Architects and engineers are no exception. You may be great at designing buildings and know safety regulations back to front, but balancing the books? This might be outside your skillset.

Learning to manage finances as an architect or engineer is crucial to running a successful business. To help, here are nine architect and engineer money management tips to help you budget, improve cash flow, file your taxes, and protect your business.

1. Take budgeting seriously

As an architect or engineer, you understand how essential budgeting is on projects. Well-run jobs have a set budget that allows you to properly plan the work to be done and maximize the amount of money you earn. Going over that budget can lead to unhappy clients and poor profitability.

You probably do everything possible to stay on or under budget during each contract you accept. But are you running your business as carefully? You’d be surprised how many firms don’t apply the same standards to running their business as they do to completing client work!

Making and sticking to a budget can help improve your architect business’ cash flow. A budget enables you to trim expenses, allocate funds to other areas of the business, and increase your profitability. Accounting software can help you get started by helping you visualize incoming revenue and expenses over time.

2. Stay organized

Setting a budget is crucial, but it may be hard to stick to if you’re not organized. Architects and engineers understand the importance of getting the details right. But once again, you might not be applying the same rigor to your office as you are to client projects.

Organizing your office and paperwork may seem daunting, but it can’t be overlooked. Properly filing invoices, bills, and other essential documents can save you valuable time searching for misplaced paperwork. This is true whether you’re storing hard copies or digital files on your laptop.

Once you have a system in place, stay on top of it. Consider setting aside an hour at the end of the day or one afternoon a week for office admin. Input revenue and expenses into your accounting software, follow up on invoices and return client messages. This can help you continue to stay organized and avoid a backlog of tedious admin.

3. Embrace automation

Technology can be an architect or engineer’s best friend if used in the right way. You may already be using automated processes to help you produce some drawings and blueprints. Why not apply the same idea to running your business?

Software and apps could help you tick many repetitive tasks off your to-do list faster and with greater accuracy. Think sending invoices, tracking time spent on projects, analyzing cash flow, and reporting. The time you’re spending on these tasks might be better spent on other parts of your business.

4. Hire an accountant or bookkeeper

Of all the architect and engineer’s money management tips out there, this might be the best one! It may seem counterintuitive to bring on more staff to save money. However, the cost of a bookkeeper or accountant may be worth the expense in the long run.

Bookkeepers and accountants are experts in money management. Not only can they help keep your books in order, but they could also identify potential savings and ways to boost your profits. Come tax time, you may be glad you have an accounting pro on your side! They could help you save time filing your business taxes and be helpful if you are audited.

There are options if you can’t afford a full-time accountant or bookkeeper yet. Hiring someone part-time or bringing in a freelancer once a month may work with your budget. Regardless of how often they are there, make sure you understand what you can do to make their job easier. Freelance accountants and bookkeepers will especially want to maximize the time they’re spending on your accounts.

5. Consider retainers and milestone payments

Large projects can be very profitable for architects and engineers. However, it may be challenging to keep your firm running if you have to wait months to get paid. Instead of charging the total amount at the end of a project, consider charging a retainer at the start and milestone payments throughout to help improve your architect business’ cash flow.

Charging a fee upfront and as milestones are hit helps you maintain a steadier flow of cash. Otherwise, you’ll likely experience huge payment spikes followed by long cash droughts. It can be difficult to budget when you’re paid like this. Creating a more predictable cash flow is easier to manage and takes some unpredictability out of running your firm.

Retainers and milestone payments can also help you prepare for unforeseen events. If a client is unable to pay at the end of a project, it might be impossible to recoup fees for the hours of work you’ve already put into it. Charging retainers and milestone payments helps ensure you receive at least partial payment for your hard work.

6. Add markup on reimbursable expenses

Many projects include items that the client will reimburse you for, especially travel expenses. Having clients cover the costs of flights, gas, accommodation, and food helps you turn a profit. But only charging for these items alone might still eat into your revenue.

It takes time to organize travel for a project—booking flights, researching and booking accommodation, and making rental car reservations (just to name a few examples). You or someone else will need to do this work, and they’ll need to be paid! Charging a markup (generally 10-20%) on reimbursable expenses helps you cover this time and effort.

7. Itemize charges on invoices

Clients generally appreciate transparency when it comes to invoices. Most want to know exactly where their money is going, so they can ensure that you’re charging them a fair price. But providing clear and understandable pricing could also benefit you.

Itemized invoices, including the tasks done and hours spent on each, help showcase the full value you are providing. This might encourage repeat business from existing clients. If they don’t feel they have a complete picture of what the competition is offering, they may be more likely to hire you again.

Itemized charges also help architects and engineers avoid scope creep. This occurs when clients ask you to do additional work beyond what was initially negotiated. Clear invoicing makes it easier to justify charging more.

8. Charge interest on late payments

Chasing outstanding invoices is a hassle. Ideally, every client would pay you on time (or better yet, early!) without needing a reminder. But as you already know, this is often not the case. You might need to find ways to incentivize them to pay on time every time.

Many architects and engineers charge clients interest on late payments. This helps them prioritize your invoice to avoid paying the penalty. Typically, the consequences of not paying invoices on time are detailed in the project contract. You might also include a note about late payment penalties at the bottom of each invoice as a reminder.

9. Consider business insurance

Successful architects and engineers are ready for anything. They take steps to avoid common risks and hazards of the job and may have a backup plan for if the unexpected still happens. Business insurance is often part of this contingency plan.

Architect and engineer insurance covers different risks you may face while doing your job. There are different types of coverage to consider that help shield your finances and professional reputation against claims and lawsuits. This may include events such as damaging a client’s property, unplanned business interruptions, or allegations of professional negligence.

Without engineer or architect insurance, the cost of a claim or lawsuit would fall squarely on your shoulders. Your business accounts and cash flow could take a big hit. These expenses could take much-needed funds away from other parts of your business.

We hope this engineer and architect firm profit guide has been useful. Applying these and other architect and engineer money management tips could help you maintain a steady cash flow and continue building a solid and successful business.

BizInsure makes it easy to architect insurance and engineer insurance to protect your growing firm. Compare policies online in minutes and get instant coverage. Start now!

As with any insurance, coverage will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained on this guide is general only and should not be relied upon as advice.
The number of quotes provided varies between products, occupations and other underwriting factors determined by the insurers.
This information is a general guide only and does not take into account your objectives, financial situation or needs. Always check with your local licensing board when getting or renewing your trade or professional license to ensure you are meeting their current licensing requirements.
© Copyright 2022 BizInsure LLC, 2015 ALL RIGHTS RESERVED BizInsure LLC; CA DBA: Simple, Smart, BizInsure Insurance Agency LLC; NY DBA: BizInsure Services LLC; NH DBA: Simple, Smart, BizInsure Insurance Agency; PA DBA: BizInsure Services LLC. 2950 Buskirk Ave Suite 300, Walnut Creek, CA 94597. License #0H8192

Get Free Online Quotes and get coverage instantly

The coverage you need for your business.

Business insurance is divided into different policies. We offer 4 types so it's easy to design the coverage that fits your business.

Professional Liability Insurance

Get a quote

General Liability Insurance

Get a quote

Business Owner’s Policy (BOP)

Get a quote

Workers Compensation Insurance

Get a quote

Let's find

The coverage you need for your business

Professional Liability Insurance

Get a quote

General Liability Insurance

Get a quote

Business Owner’s Policy (BOP)

Get a quote

Workers Compensation Insurance

Get a quote

Very good information patience was shown. Much help from Kaled, satisfied with the amount of insurance and good coverage. Affordable is what you need with starting a small business until you grow. Old saying is go as you grow.
Jacquelynn W.
21:53 20 Jan 23
Professionals at what they do! easy to navigate and very good people to lead to to the best coverage!
Magnifier 2.
20:37 17 Jan 23
I have been shopping for business liability insurance for several months. I am happy to share that BizInsure ranked #1! The representatives were polite, patient, and empathetic. They accomplished what most companies struggle with achieving: they did what they said they were going to do, they were on time, and they had empathy. They delivered a policy for 25% less than the closest competetor, and even included $50k of cyber security at no additional cost! I only write reviews when I receive exceptional experiences- highly revommended; keep up the great service BizInsure!P.S. I own a professional referral service in Hawai'i and I am going to see if BizInsure offers an affiliate program.Aloha!
John S.
05:51 23 Nov 22
They respond quickly and give you quotes immediately ...
Regean K.
23:55 09 Nov 22
The agent that I spoke to was very experienced and could tell that I was new at this and was very understanding and took the time to explain everything to me.
lotanga J.
00:04 15 Oct 22
Easy to work with and very responsive. Glad to have them as my broker.
Edward G.
18:54 13 Sep 22
We’re very happy with BiInsured LLC. VERY AFFORDABLE
Paul A. F.
19:20 11 Sep 22
Jasmine Q was on the spot professional, she knew where to direct me and explain to me my concerns and request; she delivered my personal information within minutes of me asking policy questions.That young lady is a true ROCK STAT!!!
Shaka 3 Z.
23:09 15 Aug 22
For a small non-profit, the package I was given was affordable. The representative was polite, patient, understanding, and knowledgeable.
Gertrude R.
18:06 15 Aug 22
Asked for a specific venue to be place on our certificate of insurance and it was done within one business day. Yay! Bizinsure!
Melinda S.
17:02 01 Aug 22
The process was fast and easy and the professional staff was very knowledgeable with any questions that I had and ready to help
VALERIE M.
06:40 31 Mar 22
Friendly agents. Timely replies. Fair pricing. This is a good fit for my business! Thank you, Noah, for all your help.
Beth Anne V.
19:27 28 Mar 22
They are awesome
Tony H.
00:41 07 Jan 22
Noa made sure I had all the information I needed for a first time business owner . He helped me understand what I needed to secure a quality policy and he was super helpful when explaining how the policy would serve its purpose to my company. I was very satisfied and had an Awesome experience, I think people like that make the company look good!
Wayleen O.
04:36 15 Oct 21
I was in need of WC, GL and PL coverages for my business and was able to shop, discuss, confirm and purchase all the coverages in two days! This was a great experience, especially when "Time is Money". Noah Bowman was very professional and knowledgeable. Thanks!
AmeriCreed 1.
15:42 23 Sep 21
MOVING FORWARD, I WILL BE SENDING ALL OF MY BUSINESS TO THIS COMPANY !!!! Incredible customer service!!! Thanks
THEODORE W.
19:49 09 Sep 21
Their representative clearly explained different kinds of policies to help me select the one appropriate for my needs and then helped me enroll by phone painlessly. By the end of the call, I had a policy in place.
Dissent D.
22:21 02 Sep 21
Eugene was Awesome!!!!
Lakesha G
17:19 21 Jul 21
Excellent solution for writers and authors professional liability policy as well as coverage for copyright and trademark infringement. Service was prompt and excellent.
Lane
18:22 22 Jun 21
Done in less than an hour!
William O.
00:30 02 Jun 21
Efficient, and great value. The agent was able to give us a quote and a new policy in a short period of time. Thank you
Brenda J.
20:30 24 May 21
I had a great experiencing obtaining several of my insurance needs as a landscaping company here in Northern Colorado. BizInsure's team took care of my needs and was very responsive to help with paperwork needed to secure a potential client account!
Arik S.
16:34 10 May 21
Very efficient they were able to help me out with my request promptly....highly recommend this companyI am very happy to have them
Elba P.
18:50 26 Apr 21
I need a help getting errors and omissions insurance along with general liability. Jose was very friendly informative and was very patient with me during the process. He found me some of the best rates for the coverage that I needed. Highly recommend
Casper M.
19:51 20 Apr 21
I had numerous conversations with several business insurance agents over a month's time. I also had several conversations confirming the policy inclusion/exclusions and asked many questions. My BizInsure agent was professional, knowledgeable and most important—detail oriented. Even after having an initial conversation a month earlier he knew and *remembered* all my personal/professional insurance needs. When I asked for additional information on the third call he was able to provide me with details very quickly. He was also VERY patient. That is a big plus in my opinion. It illustrated a high level of respect for my needs. I also found when I called back and asked to talk with the initial agent, the person who answered the call was able to get in contact quickly and my agent responded and returned the call within 5-10 minutes. The transaction was smooth, and I think it's a good sign should I ever need to make a claim. I highly recommend BizInsure.
Poetic F.
21:00 07 Apr 21
The rep was extremely helpful actually lowered my quote and made sure I was covered to fit my needs with my growing business! 5star!!
Franklin B.
19:04 16 Mar 21
Excellent service and prices.
Cassiopée V L.
23:13 09 Mar 21
Mr. Daniel Scott was very responsive to my professional needs.
Stephanie W.
17:38 18 Feb 21
Eugene deserves a raise! First time purchasing insurance and he made the process so simple for me. His patience and attention to detail left me feeling confident in my decision to choose BizInsure. Gracias Eugene!
Esined P.
23:32 17 Feb 21
The customer service provided by Jose was outstanding. He explained everything in a very clear/logical way and answered all of my questions. After providing all the information to obtain general liability insurance, Jose sent me the declaration page of the insurance for review. All of the information matched what I provided over the phone and there were no typos. The next day I called back to purchase the insurance which was easy and fast. Overall, my experience with BizInsure including the customer service by Jose exceeded my expectations.
Joe W.
03:29 12 Dec 20
Hiscox/BizInsure made getting Liability Insurance very easy and reasonable.I expected it to be a long and complicated process and it was a nice surprise that they made it so uncomplicated. Thank you. Lisa
Lisa W.
21:51 24 Nov 20
Eugene was incredible. I called 4 other brokers before him who were impossible to get any help.
rhonda H.
23:26 12 Nov 20
Very quick to get in touch with you and good with follow up. Had some trouble retrieving my quote to log into my account initially but Daniel assisted me and the changes were made to get me into my account. Great value for the money.
Fran S.
16:34 20 Sep 20
Very happy to be insured with this company. Professional, Timely, very helpful. Thank you Juan, you made it so much easier for me to understand.
Aileen D.
19:55 15 Sep 20
This company responded when I needed them to respond while facing a deadline. They are an excellent choice for business Insurance.
Michele H.
01:52 12 Sep 20
Jose Quintero took such great care of me and was very patient explained everything I did not understand and got me set up quickly. Fabulous customer service
Christina R.
02:41 27 Aug 20
I can't say enough good things about Daniel Santos kind and effective communication skills as an insurance agent. Daniel was so pleasant, friendly and efficient with helping me obtain insurance as a teacher. If I were to give Daniel a grade, he has earned an At . He made the process easy to understand, it was far easier than what I anticipated. Nancy S.
Nancy S.
00:47 26 Aug 20
I was in need of professional liability insurance for my sole proprietorship. A friend referred me. Everythng was quick and simple and AFFORDABLE!
hope J.
20:31 25 Aug 20
If you need Private Home Care Provider insurance for your company, BizInsure, LLC can get it for you!
Pamela C.
16:45 24 Aug 20
Great and fast service!!!! The representative was very professional!!!!
Tanya S.
19:51 14 Jul 20
I was tryi9ng to find commercial liability insurance for my new comp-any and BizInsure was easy to use and very affordable which is great for me as a new business.
Jimmy S.
19:01 14 Jul 20
Great service insurance prices are great for professionals looking to get insurance for businesses....
Rhonda G.
22:34 22 Jun 20
The provided very professional service and made the process easy.
Paul R.
21:51 04 Jun 20
Bradley Hoyle from the Biz Insure team was excellent to work with. Everything was quick and smooth. Great service, much appreciated!
Kristene S.
02:03 04 Jun 20
Anthony Spencer was great!! Very quick response time!! He was very Professional! I would suggest him because he helped me find a affordable rate and explained all the technicalities..
Fre H.
16:38 28 May 20
I was referred to Bizinsure by a industry trade group that I am a member of. It was easy to get a quote online and then received excellent customer service from Bradley H. to complete my policy purchase over the phone. I have shared this company information now with other business owners for their policy needs.
Dawn T.
22:11 08 May 20
This company was very precise with explaining services and made sure I chose the right business insurance coverage, great customer service at purchasing.
Nekeisha B.
01:30 05 May 20
Amazing
Jasmine Q
14:31 02 Dec 19
Trish is the most patient, professional and understanding insurance agent I’ve ever worked with. Trish has taken care of all my business insurance needs for the last couple years. I am really happy that I found an insurance agent that I know will take care of me & all of my concerns. I feel like a valued customer & I appreciate the great customer service that I get every time!!THANK YOU!
Dr. Youssef C. A.
17:21 14 Nov 18
Tricia helped me get insurance for my business. The task of obtaining a quote was really starting to frustrate me until I was referred to BizInsure through a different agency. Tricia got me a quote fast, and even took a down payment over the phone and issued the proof of insurance the same day. a+ service, would do it again in a heartbeat!! Thank you!!
Josh M.
18:07 22 Jun 18
BizInsure was a great find! I did not have to fill out applications, and Tricia was able to quote and bind business insurance for me within half an hour.
Allison Y.
17:28 21 Jun 18
Started doing business again and needed a policy fast. Ramez was reasonable, helpful and the rates are OK. Buyer beware? Sure, for me it turned out OK this time. Worth a call.
Mark W.
23:42 13 Nov 17
Great customer service. I've been very inpressed with my dedicated representative that had helped me navegate my insurence needs. Thanks so much!
Graham B.
22:12 23 Jun 17
js_loader

Popular Searches

Google Rating
4.4
Based on 82 reviews
×
js_loader