How Interior Designers Can Increase their Profit for 2019

Pro Tips From our Team of Interior Design Specialized Accounts

Here are simple ways to increase your revenue:

  • Use less expensive materials to cut costs and increase your revenue
  • Higher markup on cost of goods sold
  • Increase your hourly rate
  • Increase your services and the number of projects

Charge a set fee for your design services versus an hourly rate

If hourly is not pulling in the big bucks try using a set fee.  For some designers hourly does bring in the big bucks but there are an equal amount of designers that charge set fees.  If extra time is spent on a project, based on factors that are out of your control an hourly rate ensures that you are being paid for your extra time. While some designers charge a flat rate to avoid the extra time and hassle it takes to bill hourly, Ivy offers time tracking through their mobile app and platform that makes the process a breeze. If hourly time billing is something your want to incorporate into your business and there isn’t the time, check out our website for details on our services for managing your time billing within Ivy. If you do charge a set fee, don’t forget about the portion that might be taxable!

Not outsourcing services that will cost you more if you do it yourself

Think of it this way, if you charge $120/hour for your services and decide to take on the challenge of doing your own bookkeeping with our most popular package at $650 that allows for only 5 hours a month before you start losing money. That’s less than an hour and a half a week for bookkeeping. Think of all the time that is spent teaching yourself Quickbooks Online.  Your time would be better used towards growing your business. Check out our packages here!

Not charging restocking fees for items clients decided against

While your ultimate goal is to satisfy your client, keep in mind that the vendor will most likely charge a restocking fee or will not return the item. If this is the case, you will be stuck with taking the hit. Keep in mind, that shipping should not be refunded to the client if a client changes their mind since the item was delivered and this would be out of an out of pocket expense for your business. Client refunds are never a pleasant experience, so feel free to reach out to your bookkeeper for assistance. We have just included templates for these disclaimers.  Please reach out to us if you would like a copy.

Not charging markup

Markup is an easy way to increase your income

We see a lot of new designers underestimating their value and forgoing the markup when they first start.  Don’t short yourself and remember that industry standard for markup is anywhere from 25-40%

Always bill for design consultants

This can be tickly as you are building your business. Many new designers offer free design consultants to build their cilente and reputation. Our advice is to limit the free consultants to roughly 30 minutes and try to avoid meeting in the prospects’ home. It can be hard to get out of the habit of offering free design services without gaining new business.

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