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As a business owner, it can be challenging to know what is considered a business asset and how it impacts interior design accounting. A business asset is any item or resource, physical or intangible, that a business entity owns or controls that can be used to create future economic benefits for the company. Interior design businesses often work with both physical objects and ideas, so identifying assets is a valuable skill. Logistis for Designers is here to help with a guide to some common assets interior designers are likely to have at their disposal.
Furniture, Fixtures, & Equipment
FF&E is kind of an umbrella term for project tracker… but generally the term FF&E as used in Interior Design describes a schedule, or specification sheet, that lists details of the furniture, fixtures and equipment that is used for a new construction or renovation project. There will be times when the builder/architect needs to know the information (dimensions, electrical requirements, plumbing rough-in requirements) on a product that the designer is specifying in order to complete their work.
The designer will put together an FF&E schedule that details all of that information. Think of it as items that are not part of the actual structure (not building materials), but that impact the usage and feel of a space. Fixture would be something decorative that is installed/fixed to the structure (e.g. Chandeliers and other installed lighting). Equipment is something like an appliance (e.g. washer/dryer is needed for the functionality of a space, but not always necessarily decorative). Furniture is anything not fixed to the structure in any way, but the specifications might still need to be noted for space planning (sofa, tables, beds). You can also use an FF&E to track budget, stock, order status, really anything having to do with the items that you are specifying for a project.
Your interior design business’s intellectual property (IP) is one of its most valuable assets. IP includes patents, trademarks, copyrights, and trade secrets. For interior design, IP assets protect your design concepts, which helps distinguish you from others in the industry. IP is often the primary edge you have over your competitors, making it valuable to maintain.
You can monetize your intellectual property through licensing, franchising, or selling products resulting from your designs. Logistis for Designers can assist with the digital management of IP with software tools like Houzz Pro or Studio Designer.
Your employees are another key asset of your interior design business. The skills, knowledge, and expertise they bring to the table help to drive business success. Having the right workforce helps in running business operations efficiently, meeting customer demands, and making effective business decisions. Investing in your employees, from their training and development to their benefits and incentives, is effectively developing an asset that can strengthen your business. Your employees’ pay, time off, and benefits are also a major factor in accounting for your business.
Your business reputation is another intangible but valuable asset that can significantly affect your interior design business. Though it is a concept, reputation can have very tangible impacts on a business’s success. A positive reputation can attract new clients, increase customer loyalty, and enhance your business’s overall value. On the other hand, a poor business reputation can result in losing existing clients, negative reviews, and, ultimately, diminishing profits.
With the help of performance indicators and profitability analysis, Logistis for Designers can help you identify how your reputation is impacting your business.
Know Your Assets With Interior Design Accounting From Logistis for Designers
It can be challenging to identify and track assets, particularly for interior designers who often deal with more abstract concepts. The team at Logistis for Designers can assist you in identifying and evaluating your assets. With both monthly accounting packages and personalized one-off services available, we can accommodate your business needs so you can do what you love. Call today to schedule an appointment to learn more about your assets and how to take advantage of them.