Budget vs Cost: Controversy!
This week on X, I posted what I thought was a pretty basic concept: that budget and cost are different.
Well, as usual, the internet had other thoughts…!
My response to all those saying that you should never reveal your budget to your architect is, well, then you’ve already lost.
I don’t care what your budget is, my job is to tell you what you can get for that amount - and to be truthful. I’m not going to lie and tell you that you can get more than you can get, just so I can land the job. That’s unethical.
If you’re worried to tell them your budget because “they’ll just spend it all,” then don’t tell them a number you’re not comfortable spending!
The conversations I have with my clients around budget are always within the context of their scope, their timeline, and other project considerations. I use all of those factors to craft a project that hits the sweet spot for them. If they’re not being reasonable about any of those factors, and/or they’re withholding information, I’m not interested in working with them. I can’t deliver a project that meets expectations if I don’t know what the expectations are.
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All that said, here’s the original post! Head on over to X for all the comments and back and forth…
Reminder: "budget" and "cost" aren't the same thing.
In every meeting with a potential client, I ask them what their budget is.
9/10 times, custom home and small biz clients say "well I don't know what things cost, so I don't know what my budget is."
Wrong answer....unless you have unlimited funds! You don't have to know anything about what stuff costs to set a budget, because your budget is driven by factors that have nothing to do with what stuff costs.
If I walk into the grocery store, and I know my shopping budget for that trip is $100, that's the amount I have available to spend, regardless of what stuff costs. I'll likely have to make adjustments to my shopping list to make sure I'm still able to buy enough to eat - say, not buying one tin of caviar for $100 and blowing my whole budget.
Owners often feel sheepish that they don't know what construction costs, and it's a reason they're hesitant to tell me their budget.
I encourage them to forget about what stuff costs, and think about their financial situation...what works for them personally or for their business. What's a comfy number?
Then we talk thru the scope of the project - aka what they want to do. (Spoiler: everyone's scope exceeds their budget!!) My job is to coach them thru aligning their scope expectations with their budget.
It's OK to have scope and budget misaligned at first - that's what I'm there to help with! And, while the decisions can be hard, the concept isn't: if scope exceeds budget, then either decrease scope or increase budget.
In summary...back to the grocery store:
What a project "costs" is what the checkout lady at the grocery store tells you when she rings up the contents of your cart.
Your "budget" is the dollar amount you enter the store intending to spend.
The "scope" is all the stuff in your grocery cart that you're hoping to buy.
Working with good professionals who can speak openly, plainly, and honestly about these concepts is the surest way to a quality project that doesn't stretch you or disappoint you!
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