We Quoted a Design for an 8 m³/Day Plant and a 400 m³/Day Plant. The Fee Barely Moved.

Two design-only quotations went out of this office in the space of a few months. One was for a small beach resort that needed about eight cubic metres a day. The other was for a resort hotel of five hundred and fifty rooms running about four hundred cubic metres a day. Fifty times the plant. The design fee moved by about half.

I want to be exact about what this post is and is not, because I wrote about the free and paid line in our consultancy a few days ago and that post deliberately held these numbers back. That one was about where we stop giving things away — tank volumes and a concept layout free, the sealed set paid. This one is about what the paid number is and why it barely tracks the size of the plant. Different half of the same argument.

Fifty times the plant, one and a half times the fee

The small resort job was quoted at one hundred and fifty thousand pesos, VAT inclusive, for a full design signed and sealed. The large hotel job was quoted at two hundred thousand plus twelve per cent VAT for design and sealed drawings, with remote construction supervision offered separately.

Those two numbers are not directly comparable as written, and the first thing I had to do was fix my own arithmetic. One was quoted VAT inclusive and the other VAT exclusive. Strip the VAT out of the first and it is about one hundred and thirty-four thousand net. So net against net, the fee went from roughly one hundred and thirty-four thousand at eight cubic metres a day to two hundred thousand at four hundred. That is about 1.5 times for a fifty-fold increase in flow. Our own quoting was inconsistent on VAT across those two documents, which is a housekeeping failure on our side, not a pricing insight — but it is exactly the kind of thing that makes two of your own quotes look further apart or closer together than they are. We now settle VAT presentation before anything leaves.

Both of these were quotations we sent. Neither was a sale. I will come back to that, because it is the most useful thing in this post and the least flattering.

What it actually costs us to deliver a design

The reason the fee barely moves is that the work barely moves. A full sealed design set is roughly twenty man-days in this office whether the plant is eight cubic metres a day or four hundred. I know that sounds wrong, so here is the build-up.

Process design and engineering runs at about four thousand pesos a day of our own labour. CAD drawings about three thousand. Permit work about four thousand five hundred. Twenty man-days across those categories lands somewhere around seventy thousand pesos of labour. Add printing and plotting, call it five thousand. Add ten per cent overhead. That is the direct cost of handing someone a design they can build from, and almost none of it is a function of flow.

Think about what is in those twenty days. The mass balance is the same calculation at any size, and so is the sizing and specification work behind it. Running the design at several influent strengths is the same number of columns at any size. The hydraulic profile is the same exercise. Deciding what the plant is actually for — permit compliance, reuse, or something in between — takes exactly as long for a small building as for a large one, and it is the decision that sets everything downstream. Establishing the receiving water and its class, which is our work and not the client's, is one enquiry either way. The parameters that apply to that industry are a lookup, not a calculation that grows.

What does scale is the drawing count and the structural take-off for the tanks, and that is a real difference — but it is a slice of twenty days, not a multiplier on them. A bigger plant has bigger numbers in the same boxes.

The seal is bought outside now, and it lands hardest on the smallest job

We no longer have a Professional Mechanical Engineer on staff. That changed the cost of a sealed set in a way that is worth stating plainly, because it is the single biggest distortion in the small-job economics. A seal is now bought externally, and the figure is in the region of fifteen to twenty thousand pesos per set.

On the four hundred cubic metre job that is a rounding error. On an eight cubic metre job it is more than ten per cent of the whole fee, and it is the same fifteen to twenty thousand either way. The engineer signing does not charge less because the tanks are smaller — he is taking the same professional responsibility. Nor does a small plant get a shorter programme on the drawing side.

Run that through honestly on the small job and the fee we asked was thin. Labour plus the real external seal plus printing plus overhead comes out near one hundred thousand pesos of cost against a hundred and fifty thousand quoted VAT inclusive, which is about a hundred and thirty-four thousand net. That is a margin, but not the margin we think we are working at. The small job was tighter than it looked on the page.

So a percentage of the works is the wrong shape entirely

The obvious way to price a design fee is as a percentage of the construction value. Three per cent of the works, say. It is how a lot of engineering is priced and it is easy to explain.

It is also wrong in kind for what we do, and our own two quotations prove it. A percentage model built off our turnkey curve would have asked something close to four hundred and forty thousand pesos for a design at five hundred cubic metres a day. What we actually asked at four hundred was two hundred thousand. We were not undercutting a model; the model simply did not describe our cost.

A percentage fee says the design is a proportion of the build. Our cost says the design is a near-fixed block of office work with a small size-dependent tail. Those are different statements about the same job and only one of them is true for us. If you want to see how the build price scales — because that one genuinely does — the price estimator moves with volume the way you would expect, and the design generator will show you the chamber sizes behind it. The design fee does not follow that curve, and pretending it does produces a number nobody should pay.

Our own prices sit on a much flatter shape than a percentage: roughly a hundred and thirty-odd thousand at the small end, roughly two hundred at the large end, and a gentle climb between. As with everything we publish, your site is different — a fee moves with discharge class, the number of drawings a permitting office wants, the class of the water body you discharge to, whether anybody has an influent result, and how much of the treatment scope is actually in play.

Neither of those quotations sold, and I never asked why

This is the part I would leave out if I were selling rather than writing. Design-only is nought for two for us. The small resort job was never bought. The large hotel job has not converted. Two quotations, no sales, and I did not go back to either owner and ask whether it was the price or whether the project simply died. That answer is the only real evidence of what the market will pay for this, and I do not have it, which means every number above describes what we were willing to ask, not what anyone has agreed to. It is also the question I would want settled before reading our document against anybody else's.

Set against that is a fact that cuts the other way and that I have written about before. On a contract of around two and a half million pesos, we paid another party two hundred thousand pesos for commissioning help. We were the buyer of advice at exactly the kind of number we cannot sell advice for. So somebody pays these fees. It was us.

The reading I take from both halves is not that the fee is too high. It is that an owner pays for engineering when it removes a risk he can already feel — which is also why our operations and maintenance support is an easier thing to sell than a drawing set. We paid two hundred thousand because a plant was in the ground and had to pass a test on a date. An owner who has not broken ground yet does not feel that, and the design fee reads as a cost before the project rather than insurance inside it. That is a sequencing problem, not a pricing one, and I do not think we have solved it.

Why the build price goes on the same page as the fee

One thing we changed as a direct result. A design fee quoted on its own has nothing to stand next to, and an owner reads a hundred and fifty thousand pesos against zero. So the build price now goes on the same page, marked indicative where we have not costed a bill of materials yet, so the fee is read in proportion to the thing it is designing. An owner weighing a purchase price should also look at what the plant costs to run each month, which is a number the design decides and the fee does not. And consistent with our rule about document length, the price appears once, at the end.

The other half of that is the credit. A design fee is credited in full against an IWSI build contract awarded within twelve months. That is not a discount tactic — it is an honest description of what the design is to us. It is the part of the job that decides the cost, and if we end up building it, we have already been paid for the thinking through the contract. It also exposes the conflict we have written about openly: we both design and build, and a credited fee makes us the cheapest route to our own build. We disclose that in writing rather than pretend it is not there.

Where we stop quoting a sealed design at all

Below roughly fifty cubic metres a day, a sealed design set standalone stops making sense. Not because the engineering is less interesting, but because a flat cost against a small construction value produces a fee that is a double-digit percentage of the works. An owner is right to refuse that, and we should not be arguing him out of it.

So at the small end we sell a design basis and quote the build. Tank volumes, process flow, the order of the chambers, an unsigned concept layout — which is lawful to give, is not buildable from, and is genuinely useful. Small plants are also the ones that take the most running, so what that owner needs most is not drawings. If he wants to check it with an AI or hand it to his own engineer, good. We would rather be the firm that gave a small owner something usable than the firm that quoted him a hundred and fifty thousand pesos for drawings and never heard from him again.

There is one case where the shape inverts. A retrofit of an existing plant carries investigation work a new build does not, much of it the same reading we do when somebody sends us a finished drawing — the four hundred cubic metre job was itself a retrofit into existing tanks and we did not add a complexity loading on top. Which means the retrofit effort may already be inside that two hundred thousand, and we should not stack a retrofit multiplier onto these two points as though it were missing. Two data points cannot carry that much weight.

What this does not transfer to

A firm with a salaried licensed engineer on the payroll has a completely different arithmetic — the seal is a sunk cost rather than fifteen to twenty thousand a set, and small jobs stop being punished. A firm with no construction arm cannot credit the design fee against a build, so it has to earn the whole fee on its own, which almost certainly means pricing higher than we do. A lender or a bid committee that requires an independent designer makes the credit into a conflict rather than a convenience, and the fee has to stand alone.

Formal procurement inverts it again, and a bid committee will have its own questions before anybody signs. Where a tender document sets the scope and the format, the fee is whatever the tender asks for and the argument above is irrelevant. And if consultancy ever became our business rather than the front door to a build, every number here would have to move, because the credit would no longer be recovering anything.

Two of our own quotations are also not a market. Everything above is the honest cost base of one Philippine wastewater company working mostly out of Cebu, with a fabrication and civil network here and a record of plants already in the ground, and your own site will differ on discharge class, drawing count, soil, access and how much civil work sits inside the scope. Prices vary with filtration level, volume and site conditions.

If you are weighing a design fee against a build price and want a straight answer on which you actually need, book a free 15-minute consultation.