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Regarding the issue of paying for the design fees of non-standard equipment

2009-03-13View Original

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I am a preliminary project management specialist. I encountered such problems twice in engineering projects: 1. In the torch extinguishing project, the design fee for the gas tank, including fees for custom design, was already paid to the design firm as specified in the design contract. However, during the procurement bidding for materials, the manufacturing unit still demands payment for design fees. (The gas holder is fabricated and installed on-site. ) 2. Urgently request the procurement of three units for the project; the fees owed to the design firm have been paid in accordance with the contract, yet during the bidding process, the manufacturing firm still demanded payment for the assembly design work. Is this the usual practice? It’s reasonable in itself. Please help everyone.
Reply #22009-03-13
First question: 1. It mainly depends on whether the owner has specified in the tender documents that the construction drawings for the equipment will be provided by Party A. If this is not stated in the tender documents, then the bidding parties (as well as the manufacturers and installers) will not be aware that the construction drawings for the equipment are available, and they can submit their bids based on their own design and installation methods. 2. Regarding this issue, clarification can be requested from the bidders during the bid evaluation stage. 3. This situation may arise from a misunderstanding by the bidder regarding the tender documents, or it may be due to inaccuracies in the preparation of those documents. Second question: 1. Check the scope of work specified in the original design contract; if it was a design for a single unit, then the amount to be paid should be the cost associated with designing that single unit (which is actually the cost related to equipment selection) ; And if the tender requires the supply of complete units, it is reasonable for the manufacturer to request a fee for the assembly design. 2. If fixed-type equipment is selected, the design fee paid by the owner to the design firm is solely intended to cover the costs associated with selecting the equipment as part of the process design. 3. For fixed-type equipment (compressors, pumps, etc.), manufacturers generally do not charge a design fee for such equipment. However, if the user requests that several units be combined into one set, a certain assembly design fee and/or installation cost will typically be charged, as extra work is involved in this process! For reference!

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