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Posted by David Swan on Mon, Nov 20, 2017 @ 02:59 PM

2017ArchSurveyLandingPage.gifThe CBIZ and MHM 2017 Architectural Survey provides some key benchmarking, but it also comes with some lessons for area firms. Each year, our survey captures key performance and financial indicators and compares them to results from earlier years to assist with spotting trends in activity.

Some of the trends we noted in our most recent survey may be able to help architecture firms in the Greater Boston area with future planning.

  1. Keep Reducing Indirect Hours

Firms recorded a decrease in indirect hours in 2016. Fewer indirect hours means lower indirect expenses and the potential to increase profits per direct hour. Firms should continue to monitor how they use indirect hours to determine if further reductions can be made.

  1. Dial Up Direct Hours

Unfortunately, while firms decreased indirect hours, they also decreased total direct hours in 2016. Number of direct hours is crucial to several financial and performance indicators, including the direct labor utilization and the profit-per-direct hour rates.

  1. Watch Your Overhead

Overhead costs affect the breakeven multiples and the direct labor billing, the spread between which indicates profit. Despite the decrease in indirect hours—usually the largest driver of overhead costs—total overhead costs increased for area firms in 2016. Area firms should closely examine where their overhead costs are coming from and evaluate whether processes can be streamlined.

For more information or to benchmark how your firm’s indicators measure up to other area firms, download our 2017 Architectural Survey by clicking on the image.

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Dave Swan is Managing Director in Charge of the CBIZ Tofias Architecture, Engineering & Consulting Practice. He can be reached at 617.761.0734 or DSwan@cbiztofias.com.

 

 

 

 

 

Tags: David Swan, architecture firm, architecture, survey, 2017 architecture firms, 2017 arch survey, Greater Boston Architecture

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