Starting Your Career as an Interior Designer: The Business of Interior Design

All Alone Am I

I was, for a few months, a sole proprietor working alone out of my apartment in Philadelphia.  I did it all.  Sales, project management and follow-up.  I couldn't wait until I had the income to hire staff.  It all came to pass, I rented a space and began to hire employees.   Oh, that was another kettle of fish.  Still someone had to take care of all the details of operating a business.  I found the creation of purchase orders and the follow up to be the hardest part of the job.  Just getting a quote for clients could take all day.  I finally decided to assign a single employee the responsibility of that particular part of our business.  Since early 2000 Robert and I have, again, operated as a two man firm.  We do it all in house and I still find the follow up tedious.  Alone we may be but it doesn't have to be that way.  There are firms out there that specialize in  supplying an alternative to in-house staffing.  As a matter of fact, it is sometimes more cost effective to outsource the staffing than to hire and maintain staff on your premises.  One such firm, Gibson Design Management, www.gibsondesignmanagement.com offers quotes, pricing and purchase order placement and follow-up to members who join their collective.  For some firms this might not be the best choice but I believe for sole proprietors and small firms this approach could mean a more efficient use of the principals time and a savings to the firm.  By outsourcing and sharing the complex task of purchasing and follow-up through delivery you, the designer, now have the time to get out there and sell, sell, sell.  I have also looked into outsourcing other aspects of your business.  Certainly using an accountant wouldn't be effective for the day to day operations of the business but a bookkeeper who works outside the office as an independent contractor and not as a full time employee can save you thousands in time and dollars.  Drawings, renderings, working drawings for custom product and electrical plans can all be outsourced.  Some to places as far away as Asia.  Ah, the joys of the Internet.  Still, very cost effective when applied to our business.  We use people as close as San Francisco and as far away as Bangkok.  Gibson Design Management is in Virginia.  So, start thinking about ways to save money and time and get those big new clients in the door.

Never On Sunday

Robert and I were talking the other day with our writer about working with clients and I remembered that when I first started I would see clients whenever they wanted to meet.  I was, after all, new to the business of sole proprietor and felt I needed to meet every expectation of each and every client.  That meant late nights, weekends and early mornings.  I remember one particular occasion when I was asked to meet with the clients early on a Sunday afternoon.  It would mean I would be driving out to the construction site which would take about 50 minutes each way.   I was excited about doing the whole house but the client had yet to pay the retainer I had asked for the project.  They told me the check and signed letter of agreement would be with them on that Sunday.  So, without another thought about it, I made the appointment.  The day dawned bright and clear and I was looking forward to seeing how the project had progressed since our last meeting.  At this point I already had about 2 hours invested without seeing a dime of income.  It had also been my practice to meet with clients the first time at no charge.  But, that's another story. 
I met the clients at the appointed time and we went right to work.  We spent about 2 hours going through the roughed-in 4,500 sq. ft. home and I was lavish with my ideas for the job and very open about resources and the like.  After all, I had the job, didn't I?  At the end of the meeting the clients thanked me for my time and started to get into their car.  I asked about the letter of agreement and they said they had decided to use another designer and, although they liked many of my earlier ideas and would incorporate them into the working plan, just wanted to hear more of my ideas in case they wanted to share them with the new designer selected.  Well, I was dumbstruck.  I didn't have a snappy retort and simply stood there as they drove away.  I considered torching the place but decided better. 
What I did decide was Never on Sunday.  I also decided not to let myself be walked on again by prospective clients.  It became the policy of my firm not to meet with prospective clients except during our standard office hours.  By demanding the respect I and my team deserved as professionals we were able to more accurately qualify new clients.   As the years have rolled by I have certainly met with clients on Saturday, early evenings and early mornings.  Just never on Sunday.  It has given me the time away from the business I need and, at the same time, made me far more aware of the value of my time when working with clients.   Clients have far more respect for those of us who set certain parameters as to how we will do business.  Consider how you might use the same principal in your business. 

I Heard It Through the Grapevine

What! You don't keep your ear to the ground listening to the jungle drums of gossip and word of mouth?   Most designers will tell you they depend on word of mouth for promoting their business but most also do nothing to make sure the message people hear is the one they want for publication.  It's up to you to make sure what they hear is what you want them to hear.  When you are out at industry functions be sure to keep on message.  It isn't always about how busy you are or how many clients you have waiting in the wings.  It should be about your corporate story.   How you see your position in the community.  Be sure to be consistent.  Tell the same story but maybe in a different way from time to time.  Make sure the people you talk to will pass along the information to other people.  Let your clients know what your firm is doing in the community.  Have you recently been published?  Have you joined a board of directors of a service group?  These are the type of things that will make great " grapevine " talk.  When you make sure your clients know what is going on that is the same message they will pass along to their friends.  So, word of mouth is a wonderful way to market your business, just make sure you are in control of the message.  From time to time it is also a good idea to get out there and see if you can't hear what they are saying about you.  I have found one of the best sources for that kind of information is the advertising sales agents for shelter magazines and those people who write about design in your area.   Ask them what they've heard about your business.  You still need to make sure you are getting the right message out there.  Listen to the "grapevine" and hear the words.  They will have an impact on your business and you want it to be positive.  Start the word now and keep feeding the vine.  I can't wait to hear from you what happens.  Or, maybe I'll hear it through the grapevine.

Brother, Can You Spare a Dime?

Cash Flow.  Boy, what a bother.  Trying to manage cash flow when the cash doesn't come in the door in a consistent manner is one of the many things we, as entrepreneurs and self employed business people, must deal.  Certainly keeping back a certain amount of money we receive as deposits is one way to make sure the money is there when we need it.  By creating our own reserve we insure the bills will get paid.  Another way most of us insure cash flow is to borrow the money; usually in the form of a line of credit against the business.  Quite often this line is guaranteed personally by the owner.  What fun.  So, when the cash is flowing in we pay the credit line off.  Either the whole amount or the minimum interest payment.  The problem with this is, of course, the cost of the money.  Depending on how the loan, and that's what a line of credit is, is secured the interest can get to nose-bleed levels very quickly.  Especially if it's attached to a credit card.  So, we need to make sure we aren't paying so much in interest we are loosing money even when we borrow it.  Crazy, huh?  Work with your banker or credit adviser to discover what would be best for you and your business.  Usually credit cards are not the way to go.  The cost of money can exceed 20% per annum and run thousands of dollars or more a year.  Money that will never, ever, get to your bottom line.  Do you own your building?  Yes, that would be too easy, wouldn't it?  If not, and you rent, are there assets in the business against which a loan could be secured?  Try to figure out how you can prove the cash will be there when the bill comes due on the line of credit.  Rather than secure the loan personally try securing the loan through the assets of the company.  Borrowing money to run your business is still a sound business decision.  You just want to make sure you spend the money on the business.  Don't spend those deposits on anything but the item ordered and get those client invoices paid before delivery.  Then you will see an easier time with cash flow.