2015 has arrived and it is going to be a fantastic year!  Here’s hoping we all have a happy, healthy and prosperous new year, and here are some ideas that will help with the happy and prosperous part.

Are you compensated fairly for what you do?  Are you earning as much as you should?

How leading designers earn what they deserve was the topic of a keynote presentation at DCOTA with Attorney Alan Seigel and  Steve Nobel.

Alan Siegel

Steve Nobel

The audience was packed with industry professionals eager to learn what these two wise business experts had to teach us about the merits of fee-based compensation. Here is some of what they had to share.

We need to be compensated for what we know not just what we do.  We provide knowledge and expertise not just a purchasing service.

We are not in the discount business.  We are in the “valued added” business.

Much of the mystique of the world of interior design  has evaporated with the advent of some of the design shows on TV. Realistic time frames and budgets can give a misleading picture of what is truly involved in completing a project successfully.

Our clientele is more sophisticated than ever.  They travel the world and are exposed to the finest products.  They know what they like…but need our services as professionals to know how to create the interior that is appropriate to their home/business, their lifestyle and personal requirements.

We need to show clients what the value is for our service, how they will get a return on their investment.  It is not about what we charge but why we charge what we do. We act as their advocate. We are their guide through the process and maze of products and options that are available. In a sense we are their personal curator.

Asked about how many track their hours, just a few hands in the audience were raised. Seigel and Nobel did not mean keeping track of just the hours you spend with a client but all the hours behind the scenes, on the computer and phone, with contractors and in showrooms etc. that it takes to complete project.

If you want to charge a design fee or hourly fee vs a percentage/markup, how to you know what to charge? Once you know how much time a project will take it makes it easier to determine what a fair fee would be.  You also need to know the cost of operations before deciding to take on a project.

They suggest rather than dividing the fee in 4 equal amounts to be paid over a certain period of time that designers prorate the fee so that a larger percentage is charged at the beginning when most of the consultations, research and estimating etc. is being done.  They will be paying the bulk of the fee while we are designing.

Charging a fee and allowing the client to purchase at net or a discount helps keep them from being spooked by high prices and protects your profit.  Also they won’t be concerned you are showing them higher end things so your percentage will reflect a higher profit for you.

They maintain that clients like a prorated fee because it keeps your fees predictable and cash flow more steady. By prorating your fees with the larger payments at the beginning means at the end they owe less.  This avoids dealing with collecting a large amount at the end of the job. If necessary you can stipulate that delivery of all goods is dependent on all fees being current.

One way to help the client understand your fee is to see it  in relation to other costs such as the architect, contractor,  amount spent on furniture, etc.  By comparision they will see your fee is usually one of the lower costs.


Steve Nobel shares his expertise as Alan Siegel listens in.

Everything Nobel and Siegel said made so much sense.  Our world is changing and what they shared offers us a new and better way to earn what we deserve.  Do you charge an over all design fee or hourly fee?  Do you give your clients a discounted price when you do?  How do your clients feel when you charge a fee vs a percentage?  Have you encountered any problems with way you calculate your fees?  Are you tracking your hours?  Has that helped you decide on an appropriate fee?

Nobel and Siegel offer extended seminars and CEU’s on the business aspect of interior design.  Stay tuned for information on their next on in 2015.

As always we invite you to share your experience and thoughts in our comment box.  It would be great to get a dialogue going on this very hot topic.

Looking forward to hearing from you!