[00:00:12] Speaker A: The thing design school will never teach you is what to charge for your services. Today's episode of the interior Collective is all about pricing as an interior designer from different ways to charge the pros and cons of each and the formula we found most successful, we are not holding anything back. We talk a lot about pricing at design camp, which makes me particularly excited to welcome today's guest, Lindsey Borchardt of Lindsey Brooke Design, my design Camp co founder and forever business best friend. You've heard her on the show before talking pricing, but we decided it was definitely time to update our conversation around pricing your services as an interior designer. Lindsey is our oldest, dearest client at Idco Studio, and we've walked hand in hand growing our businesses together over the last seven years. One thing I've always admired most about Lindsay is her commitment to transparency in the industry. Lindsay leads her life both personally and professionally from a place of candor constantly uplifting designers and other female business owners. We are so excited to invite you to dive deeper into the interior collective. Podcast episodes now on Patreon unlock access to in depth analysis, helpful downloads and worksheets created with each podcast episode, subscribers gain behind the scenes access to additional resources like examples and screenshots of guest spreadsheets, construction documents, and so much more. Your subscription also gets you immediate access to our private community of interior designers and our team of industry experts. Ready to answer your questions? Subscribe
[email protected]. the interiorcollective or linked in the show notes. Join the interior collective Patreon community, and let's continue this conversation.
Hello, Lindsay, and welcome back to the show. I can't believe it's been two years since we had you on last. I feel a little selfish. Like, I, like I save you exclusively for myself and for design cam. But I'm glad that we can bring the conversation back to the podcast today. Thank you so much for being here.
[00:02:14] Speaker B: You're welcome. Of course, I've told you before, I will always come here. No matter, no matter what, no matter when you tell me to. I'm here.
[00:02:22] Speaker A: Well, we have so much to cover today, but when talking pricing and profitability, we have to start with identifying, understanding, evaluating, strategizing your overhead expenses. We really believe in this wholeheartedly, and so I want you to kind of break down to us how to figure out your pricing from overhead. Like, why is this the first step? How to plan for overhead expenses? You had mentioned to me really important, how to categorize your expenses and also how your team's time billing can really help you to find your pricing. So we'll start at the beginning. How, how are you figuring out your pricing based on your overhead? Why is this step one?
[00:03:06] Speaker B: So we can't really figure out what to charge if we don't know what we're spending, right. And we talked a little bit about this in the last podcast, but what I have learned is having a software system now. I will, you know, if you go to design camp, you know, we talk about studio designer. We do all of our accounting through studio designer. I did not know how detailed you really should be getting on your overhead. So before I was like, yeah, list out this. It's really easy to say, okay, I have rent, I have my utilities, I have my employees, whatever. But, like, being able to categorize those into an even more detailed, detailed category is super important to understand, especially if you have different aspects of your business, like I do, where I have a store, and then I have a design firm, I have design camp. So I have to really understand what is my overhead for the store versus what is my overhead for the firm. And sometimes that can get really muddy when our store and our firm share the same roof. And, you know, our employees are kind of like one, too. So I think it's super important, no matter what software system you work with or with whoever you work with, bookkeeper, CPA, that you have a really clear understanding of your categories and that you're categorizing rent into, making sure it's into whatever business entity it needs to be into. So, for instance, our rent is around $10,000. Well, we share that rent with the firm and with the store. So we really have to kind of divvy that up to say, okay, you know, 50, is it going to be 50? 50? Is it 75? 25? Like, what is that? So that I really have a good understanding as to, okay, our store is pretty much three fourths of our space when I include kind of like the back, that really, half of the back that really houses accessories. So 75% of that 10,000 is really our overhead for the store. The other thing that was super important that we did this last year was categorizing time billing for my employees, which is very easy to do in studio designer. Don't know if you can do this in other softwares, but basically they're called activities. And what we did is before we just had a 2024 hourly design rate. Right. And everything that they did fell under that category. And then they detailed whatever they did during that, you know, 4 hours, 3 hours in the description. Well, now we have activities in studio designer for basically any activity. Right. That they do. So we have about 14 activities right now. And they range from concept design to sourcing to design proposals, to project management to autocad drawings, so that when they are inputting their hours, they're clicking whatever time billing that is that they are doing. And then I am able to pull reports and see, okay, Christine spends a lot of time, a lot more time doing proposals than Andrea does. So it gives me a better understanding because I might say, oh, a proposal is going to take a day to make. Right. But then if I really look at that reporting and I go, actually, proposals take a lot longer than I thought because I am not necessarily one doing those activities in the day to day. So it makes it very clear for me to be able to see what my employees are spending their time doing and how much of it so that I really understand then how to price those projects. That makes sense.
[00:06:41] Speaker A: Yeah, absolutely. And I feel like even if you don't have a team as large as yours, even categorizing those different activities throughout your day, if you are running and operating your business entirely on your own, you know, you get to the end of the project and you say, great, this project took us 220 hours total. It's really hard for you to go back and remember, well, actually, that proposal, I did spend 12 hours on that when you're looking at just one giant number. So for you to better be able to estimate your proposals for your clients, I think it's really important that not just from a time billing sense for your team, but even if it's just for yourself, that is a critical component of figuring out your pricing.
[00:07:25] Speaker B: Oh, yeah. Because, I mean, I think at the end of the day, you have an idea what you think things are going to take you to do. But then when you actually look back and realize, oh, it doesn't take me that long, or maybe it takes me a lot quicker than I actually think it does, it can really help you plan to figure out how you want to price, whether that's by phase or bi hourly or whatever it is. And especially if you do have employees, it's also good to know how every employee spends their time, because I have four designers, and those four designers all work, even though we have the same process, they all work a little bit differently. So some designers take a little bit more time doing proposals than others. And so it is helpful for me to know that information when I'm looking at a new project and I'm going to bid out a new project. And I know that maybe Christine and Laura's team is going to be on this project so that I can bid that proposal based on their length of time for doing things rather than maybe Andrea's length for time for doing things.
[00:08:27] Speaker A: I'm curious if there's an element to this that, like, my brain isn't computing in the sense of, is there ever a time where these different activities cost you less as a business owner? And so you can see that your margins are greater for procurement versus something else or because for this particular example, you bill a flat hourly rate no matter what to your clients in the design phase, that it actually wouldn't make a difference there. Does that question make sense?
[00:08:59] Speaker B: Yes and yes. I think you're right. I think that you can look at the data. So what I have, like, this last year for me is all about, like, grabbing data. Like, I'm like a data junkie now. So, like, I want to record everything. I want to, like, understand my numbers. Like, it's been really difficult to fully get that information because it also takes time. Right. Like, you can't just, like, you have to, like, do projects and do all this stuff in order to get this data, right. But I do think that there is a way for you to evaluate certain things. So if there are tasks, let's say project admin is a good one where you can look at, and I'm not talking about project management, I'm more talking about, like, emails, communication to clients. Right.
Proposals could even be in that. And you can look at that and you can, let's say you're, you're looking at one project and let's say that you bill, you know, $50 or $100, you bill a lesser amount of time for that project admin phase or activity or whatever, if you're looking at that and go, wow, like, that's, that's really taking me nothing. But, you know, the work is really important. You could always take that information and then bulk it into a flat rate and have it be higher than what that hourly would be. And that's kind of where we're leaning towards right now. We're taking some of our phases and we're making them into flat rates so that it's just a lot nicer for our client when I know, okay, looking at these past three projects, our project administration hours are really efficient and really low. And I really shouldn't be charging $100 an hour because it's a super important part of the project lifespan, right. So if I can make that into a flat rate and make it a little bit more higher than what I know. So I cushion it a little bit, because when we're doing a flat rate, you always should cushion, then, yes, you could be making more money that way. So I think it's to see those numbers and to look at that. But again, it's gathering that data and then really studying it and understanding it to be able to make those better choices.
[00:11:06] Speaker A: It's something we talk about in length at design camp, that as you get better and better at your job, you shouldn't be punishing yourself and taking a pay cut because you are faster at what you're doing, because you have more experience. And so I think that's a great example. If you are curious as to how Lindsay has priced her service for the last seven plus eight years, make sure to listen to the interview back in season two. I've linked it in the show notes, but Lindsay has been going through a transition and adjustment in how she builds, and that's really why we wanted to do this episode. So, Lindsey, can you give us, like, the brief cliff notes three sentence explanation of how you had previously been breaking down your pricing stages?
[00:11:48] Speaker B: So, first off, I'm pricing very similar to this. I'm just taking those phases and doing some flat rate. So phase one was design work. It was all hourly. Phase two was procurement, which is basically ordering the product, making sure that it's coming in okay. Dealing with claims, dealing with the receiving warehouse. That was a percentage of the product that the client was purchasing from us. And then phase three was install. So mostly just for furnishing jobs. We weren't really obviously, like installing construction, but mostly for furnishing jobs. And that was a flat rate by the day for the team. So that. Yeah, and then I, obviously, the last podcast really breaks it down for you.
[00:12:30] Speaker A: Perfect. So again, we have that linked in the show notes for you. But I really want to get into the small pivots that you've made to really maximize your profitability and increase what your business is making without necessarily increasing your hourly rate. So that's our focus here. I know in the past you've been burned by flat fee, and you never know how a client is going to work and how much just personal touch they're really going to need. But we at design camp, with our guests, with our keynotes, with our campers, have really been hearing more and more that flat fee can and does work well, particularly for the design phase of a project. Can you talk to us about how you've incorporated flat fees into your pricing model. Now, whether that's in the design phase in procurement, where, where are you fitting that in now?
[00:13:21] Speaker B: So procurement is actually staying the same. I really love doing our percentage because the more and more every year that I look, and we've now been doing this for about, yeah, six years or so, and we've been in studio designer for about three years. And I say that just because all of our data is now in studio designer and it is so much easier for me to grab that data than before. So when I talk about, like, knowing all this stuff and I'm just kind of prefacing, this is because I know the data for the last three years. So, like, the three years prior, hopefully we were making money. But, like, at the end of the day, like I thought I was, who really knows, you know, because I just wasn't tracking it really correctly. So phase one with the design, we are now switching over to doing flat rate for design because we know that we can really own that time management like that. I'm very confident in knowing how many hours it will take us to do whatever we need to do to get that design package ready for the project. So that is shifting. And then phase two, procurement is staying the same. So we are staying at our percentage for procurement. And again, we will be possibly increasing that percentage when we feel like we need to. And the great thing about that is, like, increasing at 1% really does not mean that much to the client. At the end of the day, it's really not that much more money for the client, but it is more money for us, especially when we have an employee whose full salary is dedicated to procurement and then our install flat fee actually just gets wrapped up into that flat fee with the phase one. So essentially combining phase one and three now into a flat rate and then adding in or keeping the procurement, and then I'm adding in almost like a fourth category for project management. And I'm actually doing, I'm giving my clients the option right now to do an hourly estimate to how the normal way that I charge or to have a flat rate. And I'm giving them the option because right now we're in the trial period of really trying to understand if this is going to work for our business. And so I like to be really transparent with them and tell them, you know, when I'm doing the in person consultation, this is how we charge. Our investment guide, kind of our investment guide right now breaks down how we normally charge, but there is a new page in there that basically says, we now offer flat rates, and this is how this would work. And then I have a real honest conversation with them. And I said, listen, if we do hourly, it's going to be a range of hours, but it's an estimate. It is going to be based off of the data that we know. But again, there's still so many unknowns that we have with the project. If we go flat rate, it might be a little bit higher, or it might be towards the higher range of the hourly that I give you, but you're going to be locked into that price. And so they have to outweigh kind of those pros and cons of what they feel is going to be comfortable.
[00:16:30] Speaker A: For their phase one design fees, which now you're proposing as flat rate. So much of this depends on how many revisions a client wants. And that's, I'm sure, why you didn't go flat rate for a long time when you're putting together that initial proposal. And I am going to beg you to come back so we can just talk about budgets and estimates in a completely separate episode. So we don't need to detail this super hard, but how do you provide yourself enough cushion in that flat rate to cover the hours spent during this phase, especially when we are talking about revisions?
[00:17:05] Speaker B: So a big thing that we decided to do was not include revisions in our flat rate. I think when I had started out doing flat rate, which was the very, very, very beginning, I did flat rate for one project, and that was x. I didn't make any money, but I really didn't have an understanding as to what needed to be included in that flat rate. Like, what are those? Deliverables. Right. So it's really important, more so than the actual flat rate itself. It's really important to understand and to list out in super, super detail what is it that is included in this price. Flat rate. Price and what is not included. So I know we'll go into proposals, but at a later date, but I make sure that that is written out in the proposal, what is included and what is not included. So we decided to not do revisions because when we look back at our previous projects, revisions were really all over the place. There's some clients that are, like, wanting to see every option, or they're just not happy. They can't figure it out. And we spend so much time in revisions, there's other clients who want to see one other option, and then we get out of revisions. So to me, that was a really big question mark that I do not feel comfortable, at this point, bulking in with that flat rate. So we tell them all revisions are at our hourly rate. And what we did that actually has been really helpful for our clients, is that when we get into the revision phase, we basically do a small little mini proposal for them based on the revisions that they're asking for. So the price is not this, like, question mark to them as to, like, what are they going to be spending in revisions? We say, okay, based on your feedback, you're asking for this, this, this, and this revisions. We write it out like we have a canva document for this. And then we estimate the amount of hours, and it's a range, small to high range. This is what it's going to take for you to get those revisions. And so sometimes it makes the client go, huh? You know what? I actually, you know what? I do like that entryway light. You know, let's just. Because when they see pricing, because I wasn't doing this before, and then they'd get these bills and be like, why are we over our hours? And it's like, well, you were in revisions. And so I'd have to go in, and thankfully, I had those activities as a revision. As an activities. I can go in, filter down and go, well, you had 30 hours in revisions. And in their mind, they're maybe only expecting revisions to take 10 hours. So having that clarity of saying, okay, here's now this new proposal of what the revisions is going to cost you has been super helpful. But long story short, we do revisions separately.
[00:19:45] Speaker A: Great question. Also in this phase, so I know you're giving a flat rate internally. Is everyone on, are you accounting for hours based all on the same hourly rate? Again, you're giving a flat number, but are you assuming that your designer, one, designer, two, not procurement? Cause that's a separate percentage. But Admin, everybody on your team is at x number per hour. Or are you coming up with this flat rate based off of different pricing tiers internally?
[00:20:18] Speaker B: So we have always worked at a one pricing rate model for the last several years, and I really, really enjoy it, and my clients really enjoy it. So we do not have different employees on different rates. We charge the client the same hourly rate for every designer. Now, we do not have a junior senior designer type of structure. In our department, everyone is a lead designer. There are two teams of designers. So you get two designers on your team plus me. So you get essentially three designers who are on your project, who are handling everything from design to project management to install. So that is also a way that we have been able to increase our profits because everyone is the same rate to our client. I don't have one, you know, one junior who is $100 less than another. Because what I found, and talking with a lot of people at design camp, too, is that then the clients want that junior maybe to do a lot more work, or they're not understanding why the seniors are doing certain things and why the juniors are doing certain things. It just gets, again, a little muddy. I want to try to keep pricing as black and white as I can because it is so gray internally. But I mean, for the client's perspective, for it to be very simple.
[00:21:40] Speaker A: Yeah. And one thing I believe it was Marie Flanagan's keynote at design camp that really, really taught me this. At the end of the day, the junior designers are often doing some of the heaviest lifting in a project. So even though their billable rates aren't necessarily as high as, you know, Marie Flanagan's, she really had struggled with, like, putting a different value on different people within the team, and I had really appreciated that.
[00:22:10] Speaker B: Yeah, I felt the same way. And I also think that it's super important to. Now listen, if you definitely have someone who is starting out and is very junior, by all means, you can have them be a lesser feat. Like, again, like, for my team, the way they're structured, they're all very same level designers. So it just didn't make sense for us to have those titles anymore because my designers, who started off as really a junior, has been with me for three years, so she's not really a junior anymore. Right. So, yes, I agree with you not putting a value, but again, if you do have someone that is maybe just out of school, doesn't have that experience, then I probably would have them be a little bit less, but I wouldn't have the gap be really large.
[00:22:53] Speaker A: Okay, let's talk about collecting payment in this phase. So you have sent off a custom but flat rate proposal to someone. Your flat rate is not the same per project. Obviously, it's based off of scope of work. When are you collecting a retainer? How much is that retainer? When do you collect the rest of it, as far as these design fees? Because this is all flat rate.
[00:23:16] Speaker B: Yes. So we still collect a retainer that has nothing to do with either our hourly or our flat rate packages. It has nothing to do with our design time. That retainer is for the balances of their project at the end of the project, which typically is either shipping charges, receiving warehouse charges, install, sorry, not install accessories like things that we're bringing in last minute, I would say 90% of that is shipping charges and receiving charges, or let's say like a handyman or, you know, a wallpaper installer, maybe last minute or whatever it is. So it's $10,000. It's not like a lot when you're looking at, like, the amount of money that a project is for us, but it's enough to cover for me to know, okay, if at the end we install stuff, we never hear from them or whatever, like, it covers us a little bit, then for the actual design fees when we're now doing flat rate. So our proposal is still kind of broken up into two phases or three phases, really. It's the design time, which is construction and furnishing. I'm going to just say we're doing a full scope home, which construction and furnishing together just for the sake of this. But all of that will be bulked in one design, flat rate. Then we will have the project admin flat rate. And to start the project, we take 50% of that design, flat rate. So if I proposed $50,000 for design for this project, then I'm going to take half of that to start the project, plus that 10,000 for the retainer. So they're giving me $35,000. Then when we get done with the, let's say they go into revisions, we bill those a monthly time billing for hourly. Right. So that's going to be a little bit separate from the flat rate once they approve their design. And we're going to be getting out of the design phase, that design flat rate, we collect the second half of it so that we are fully paid for our design time. Even though we know some things might change here and there, once we go into project administration, usually it's not going to be something that's like completely redesigning the scope. Right. So then we collect that 50%. Then what we do is once we start construction. Now, we know that when we are approved with a design, we're not just automatically going straight into construction. We could be going through a bidding process. They could be waiting for the contractor schedule to start. So it could be a month, couple months before we even get to that project admin. Well, as soon as a hammer gets knocked into the wall, we collect 50% of that project admin fee, and then we collect the other 50% as we get closer to the project.
[00:26:09] Speaker A: So this project admin phase, you said currently you are giving your clients the option, correct? This is the phase that you were saying there's the option for flat rate or for an hourly range.
[00:26:21] Speaker B: No, we're doing that for the overall, like, the whole project.
[00:26:25] Speaker A: Oh, not just project admin?
[00:26:27] Speaker B: Not just project admin. So I wanted to really give my clients, hey, here's how we were doing things. Everything was hourly at this phase, and here's the ranges. But most of the time, when they're looking at that, they're looking at the low range, and it's like, well, you kind of have to make sure that you can do the high range, too, in case we get there. Or I'm saying, hey, we can do this all at a flat rate. Now, within this flat rate scope. I know so many designers have said, well, I do flat rate for design. Cause I can handle that. I can manage that. I'm in control of that. But I do all of our project management on an hourly basis, which I do agree with, and I do like that. However, we include our minimum project management hours in our flat rate, and that is listed out in the proposal. What those minimums are. It's around 40 hours worth of work, and we list out all those meetings. So it would be, you know, maybe looking at the site after demo and then doing electrical, plumbing, walkthroughs, drywall. Once drywall goes up, then it's cabinetry, then it's tile. So all of those, like, if you do not want us to handhold, you know, your project through the whole time here, the minimum that we're requiring, and then anything above that will then be charged at an hourly rate. But at least they have that bulk of ours included in our flat rate so that they really can understand how. How much their project is going to take because it costs them. Because when you're doing construction, we have had projects where I have, being really honest, really low ball them because I didn't understand the scope. And you obviously don't know a lot. We. We're not doing a lot of new builds here, so it's a lot of remodels. So we really don't know what we got until we start knocking down walls and taking things apart. We have a project right now that, like, rewired their whole house, because when they looked in the walls, all the electricity and electrical stuff was just like, shit, really. So, like, we had to completely do a whole new RCP plan, electrical outlets, all this stuff that we weren't accounting for. So we like to have those minimums. We list those out in the proposal, and then anything outside of that is an hourly rate.
[00:28:39] Speaker A: How are you charging for travel. So you have all this listed out of like what you anticipate these hourly or this hour minimum? What about like site visits, even initial consultation and like sourcing travel time? Are those all billed separately? Is that built in? How does that work?
[00:28:55] Speaker B: So initial consultation is always a separate fee. So travel time is included in that. Now if it's over 20 miles, then there's an additional fee for the consultation. I usually just charge them maybe like one and a half times the consultation rate. Now, once they're a client, same kind of applies to them. If they're over 20 miles away from us, we charge a mileage fee, which is not actually by the miles, it's by the hour. So we charge just flat rate by the hour to get to that project?
[00:29:31] Speaker A: Yeah, because in la, I mean, it could be 2 miles and it could take you an hour.
[00:29:35] Speaker B: Exactly. Exactly. I did it by miles and like going to Santa Monica, like, you look at if you were to just to like, track it by miles. Like, we are 20 miles from Santa Monica, but it could take us an hour and a half to get to Santa Monica. So it was really important for us to do it by the time that it takes us to get there rather than by the actual mileage.
Now for projects that are like out of state, do you want to talk about that travel or are you just talking about normal travel?
[00:30:02] Speaker A: That's how you're handling travel on a local basis. What about travel for your distance projects?
[00:30:08] Speaker B: Yeah, so travel for the distance projects are going to be. Our client pays for our hotel, airfare, transportation, and then a per diem for food per day per designer. Sometimes I'll just bulk it into like maybe a bigger fork. Like whoever goes a bigger rate when we are doing travel days, we do a flat rate. So it's just flat day rate per person. And that is basically what we call our travel days. I don't care if the flight is 6 hours or 1 hour, regardless, we're waking up, you know, hours beforehand, we're still hours getting there. And so we have just like flat rate. Keep it really simple. And then once we are there, if they decided to go with us on an hourly rate, we're just charging them our hourly rate. And once we are there, if they do our flat rate, that. That time that we are spent working is just built into their flat rate. Now, sometimes with this, and this is what I still need to work through, we have not done this flat rate program with someone who is out of state. I do think that we might need to incorporate the travel days as just an hourly rate and keep it a little bit separate from the work that we're doing back home. Because if we are there for two days, I know my girls, they're going to stay late. They're going to do whatever they need to do. And so I think that we're still working through that, but it seems better for me to just keep that like a separate thing, kind of like revisions and like any time that we're like traveling to the house will be kind of a separate thing and we'll stay hourly.
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Got it. Perfect. Thank you. Okay, let's bump over to ordering and procurement. You mentioned that that is a set percentage. Can you tell us specifically what that percentage includes?
[00:32:31] Speaker B: Yes. So that percentage includes ordering all the items, tracking all the items. So making sure that like the estimated ship dates are in our spreadsheets, that when something gets to the warehouse that she is dealing with the warehouse to make sure that there aren't any damages or it didn't come in the wrong color or the wrong thing finished or whatever it is.
She is also working with the receiving warehouse to get those items ready for install. And she is also prepping like our install kit before we do an install. And she's working then directly with the designers to get information to the clients of like when things are coming in and working with the designers to say, can we do this install in one full swoop or do we have to do multiple installs? Maybe we're doing two installs with the team and then a couple of pieces will be just like delivered to the client afterwards. We all know it would be super nice to just have one big giant install and for the most part we strive for that still. But in reality it just like doesn't happen. So she really has to help us coordinate that. And then this is also kind of going back to overhead really quickly. I wanted to touch that. This is really important to categorize even payroll because for me, I can't bulk everyone if I were to bulk everyone under one category in payroll and be like, okay, well, I need three times the amount of that in my time billing. It's not really going to match. So, like, Leslie, who's our procurement, she's taken out of that bulk because I need to compare her to our actual procurement line in our profit to go, okay, are we making this profit? Same thing with Lisa. She's not included that she's pulled out because she's for the store. Same thing with Katie. She kind of gets pulled out because she's not designed. So when you're looking in your overhead to say, okay, well, I have employees, and I need their payroll to be three times the amount you need to make sure that you're really just including those designers.
[00:34:29] Speaker A: That's so helpful. It's such a good reminder I'm going through the same thing, just making sure, like, you know, our CFO is like, hey, you have to cut payroll. You have to get payroll. Like, that's your biggest expense. Obviously, being a service based business, it is our biggest expense. But it's been so helpful for me to understand, hey, our content creation team, like, we need to increase that revenue to x because they are not covering their costs, really. Design team is covering the cost of content. And so we've been able to kind of shift things around because I can't just lump everybody into the same category. So. Okay, one more question. Two more questions about procurement. Lindsey, are you willing to tell us what the percentage you charge is for the procurement fee?
[00:35:12] Speaker B: And so we do 12%. We started off doing 8%, which was super low, and then we. We raised it during.
We raised it before COVID to 10%, and then we raised it at 12%. We've. We've kept it at 12% for a while now, because right now, we're still making money, but it probably will increase by next year, I would say by 1%, because Leslie has been with me, and. And I want her to grow. Right. And so, like, as her salary grows, the procurement rate has to grow. And also, we are still seeing a ton of damages and a ton of things coming in from manufacturers that really hasn't gotten any better from COVID Maybe a tiny, tiny bit, but it's. It's a lot worse than it was. I'm. I don't know why, but. So we have to account for that.
[00:36:02] Speaker A: So just so that this is super clear to everyone listening, this flat 12% procurement fee is going to be a line item on their product invoice. Is that correct, or you are you collecting this before?
[00:36:14] Speaker B: After.
[00:36:15] Speaker A: When is this transacted?
[00:36:17] Speaker B: So, yes, you're correct. It is on their product invoice. So basically what we do is we will send them a proposal with all of their items without the procurement fee. And this is the initial proposal. So it will have maybe two bed options for the primary bedroom and a couple of living or a couple of sofas, you know, whatever. So they approve and reject that based off of what they, you know, maybe pricing or what they want to do with their project. And as soon as that is approved, they're ready to, like, send payment. We add that procurement fee, we take off. Right. The things they don't want. We add that procurement fee as a line item. We have figured out a way to do that in studio designer, and this is what I love about studio designer, too. You can kind of hack it because this is not a normal way that our industry charges. So we were able to figure out how to do that, to have it be its own separate line item at the bottom of the proposal. And that is on the subtotal. So I don't include this on the taxed portion. This is the subtotal of the products.
But the procurement fee in general is taxed. And we talked about this last time, but we do tax it in the state of California. We do have to tax for our time selling goods. I still don't know if this is a federal thing or state thing, but, yeah, so we tax that. So when they see that line item, it's the procurement fee. It's at 12% plus tax.
[00:37:43] Speaker A: Great. And just so it's crystal clear, this procurement fee does not include the receiving warehouse at all. That is separate, that is billed back either. Well, tell me, do you push that through directly to your clients or is that something that you are marking up? Are you sending the bill and you're paying the bill? But I am correct that 12% does not cover your receiving warehouse.
[00:38:06] Speaker B: Correct. 12% is just our time. So I basically tell the client and explain to the client, if they don't understand it, is think of it as, like, our time billing. We're not charging hourly at this time. This percentage takes care of all of that time that it's going to take to order. Now, the other thing that has nothing to do with, like, pricing is, but that was super helpful in explaining this, is that now when we enter different phases, we are setting them up with education, so we are sending them what to expect or kind of like how it is to order. So, you know, it's very easy for us to understand. Click to cart, pay the cart, and then the product shows up. Well, we all know it doesn't work that way in our industry. Some of the vendors, maybe we're doing that. Some of the vendors are emailing pos to, or we're getting on the phone, or we're emailing like, there's a million different ways to purchase goods. So we are now sending to our client what to expect. And again, another breakdown of what that procurement fee includes in that time. What I love about getting it now is that when they are giving us one of their biggest bills, it can be hundreds of thousands of dollars for their furniture. That procurement is already included in that. This is the time that they are super excited. They can see their project come to life. They want to give you that money to start ordering their products. They want to have it at the end. So before we were, we were collecting that at the end, which was not a good experience. But now we do it right when we collect that big amount. We'll adjust it if we need to later, but it's collected right when we collect for the actual product. Now, the receiving warehouse is, like you said, a separate cost, and every receiving warehouse is going to be a little bit different. Our receiving warehouse will not allow the client to, they don't want, they, they want to have the relationship with us. They do not want to chase money from our clients, so they do not allow our clients to make payments directly from them. Other receiving warehouses might, but for us, we pay, the receiving warehouse client pays us for that. So we have them as a vendor in studio. The way that they work is they will have storage fees for several months leading up to their project. And we collect those storage fees monthly. So they will see, okay, maybe they're not getting a couple of storage fees for the first few months, and then it's a couple hundred dollars and then it grows. So that also is nice for them to say, oh, product products are coming in, and we're kind of letting them know like we're having, you know, nothing's really back ordered like we thought it was going to be or whatever it is. And then at the end of the project, we will get a receiving bill, which is usually several thousands of dollars, which really is just the white glove delivery of all of their items to the house. Again, right before installation, we're giving them a what to expect and like what they're receiving where a house is doing. So they're like unpacking boxes, they're putting furniture together, maybe they're moving furniture from their. From their house to their garage or whatever it is. They're taking all that trash. And then that $10,000 retainer that I had gets now put towards that big receiving warehouse. But it's really for the delivery portion of the receiving warehouse, if that makes sense.
[00:41:28] Speaker A: And that's another great way to make the end of a project feel more warm and fuzzy, because it's not another $6,000 bill. They've already. That money's technically already spent in their eyes, and so you can apply it there. So I think that's a really smart way that you're applying that. So, Lindsey, one thing that I think makes design camp just, like, so profound is how much you and I learned from having these open, candid conversations with everyone who's attending. Obviously, we learned so much from our amazing keynotes, but, like, it's our. It's our campers that, like, continue to blow my mind. And learning from each other is by far the most valuable aspect to the event. And we always say, like, yes, you come to learn from us and our speakers, but, like, the value of design camp is the people you're in the room with. Which really leads me to my next question, and this is kind of a tougher question a designer had shared with me during dinner one night that our clients really push back on the concept of a percentage rate of product for procurement, because they're like, why do I have to pay more for procurement? Because I have nicer, more expensive furnishings, versus if we had picked less expensive furnishings, you know, that client is paying less for procurement. Why is my stuff more expensive? What advice do you have to explain this portion of your pricing model to alleviate that concern so that people are more comfortable with that 12%.
[00:42:58] Speaker B: I think when it comes down to figuring out your procurement percentage, you have to take a good look into what vendors are you using. If you are very high end, and let's say most of all your vendors are more expensive, then maybe your procurement rate will be a little bit less to balance that out. Now, we do a lot of high low. So some will be very inexpensive products, and some are very high end custom products, and we use that procurement fee based on that we mix, and that we know that it's going to balance out at the end. If I knew that my clientele was not a high end clientele, and we did very, you know, inexpensive items, my procurement fee might be a little bit higher to cover that. So I think that that's the step. Number one is to really understand your vendor cost what you're making on your vendor cost. Also, if you are making a higher margin on product, you could maybe have a lower procurement fee because you are then making up for that in your product sales. I feel like it is always good to just have a conversation with clients when there is pushback, to fully have them understand your process and why you do the things that you do in your business. Right. So I always say it doesn't necessarily matter if the sofa is $10,000 or $2,000.
We are still dealing with customer service issues. We are still dealing with a receiving warehouse. We are still dealing with damages. Just because that piece is more expensive does not mean that it's easier to maybe get someone on the phone. It does not mean that there are going to be no damages.
It just means that that piece is higher priced. So you could do two things. You could maybe say, hey, if there is a product that is x amount over, like, if it's over $10,000, that product will have a lower procurement fee. I think that that's going to get hard. You might have to put all of those things on a separate proposal so that you could just figure the math out a little bit easier.
But I think as we start educating our clients more, and like, you know me, I've always been like, educate, educate, educate. We are like, taking it a step further now, and I think that it's very hard because you have HGTV, you have people, influencers now has played a huge part in our industry, and you have people's expectations that are just still not going to be, that are just so much higher than, unfortunately, than what our industry allows. And so being able to really have my clients understand why it is that we do something has been super helpful with their experience. So I don't know if I gave you, like, the best answer, but I do think the first step is to really figure out your price point, your ideal clientele, and making sure that that procurement fits my procurement rate fits the vendors that we use. The, I only have one procurement team. Maybe you have a couple. That procurement has to cover a couple people salaries, so it's going to be higher, you know, so then you have to look at that as a whole. And then I think just educating the client and letting them know, like, it really doesn't matter what the price is because we're doing the same amount of work.
[00:46:39] Speaker A: Absolutely. I think your advice also, you know, or the reminder that this is all getting billed at the time that the client's so excited to start ordering their things. So, you know, this isn't a bill that's coming at the end where there's a procurement fee percentage, and they're like, oh, my gosh, seriously, there's another bill. It's all in there. So I think that that can help, too. But it was just another great example of how much we learn and how much we take back to our own businesses. After having those conversations at dinner with designers from all over the world, I'm.
[00:47:11] Speaker B: Yes. I mean, the whole reason why I. You know me, I've always been like, no floppy fat fleet. No, no, no, we're going to do it. And then, okay, last two cams. I've been talking to so many people and really understanding the dynamics of, like, what everyone is doing. It's so helpful that it's really one of the main reasons why we decided to give it a try is because I was like, okay, I do have the data. I have the information, and it's working for these people, and we're going to try it. And if it doesn't work, then guess what? We'll go back to the way that we're doing it, I think another genius.
[00:47:42] Speaker A: Example, and I'm hoping Heidi will come back on the show to do another episode just on this. But how she does full construction and furnishing, presentation, one presentation, everything signed off, signed, sealed, and delivered all in one. And it just totally blew my mind. And I just had never even considered that being an option or how to get through there. So it's just being able to ask these questions with people is. Is. It's like the podcast times infinity. It's so much better.
[00:48:10] Speaker B: You know, I was, like, God smacked. I was like, wait, what? I literally could not even, like, wrap my head around it, and I couldn't even, like, ask her the next question because I was like, literally, my brain started moving as soon as she said that. And, like, my designers are watching that, like, taking notes, too. We come back from design camp debriefing, and that was the biggest thing of, like, oh, my gosh, how can we do this? I still. I'm literally going to book an expert call with her because I'm still like, I need to go into detail about how this is working, and I would never know that she even did that. Had an option for design camp 100%.
[00:48:44] Speaker A: So, okay, before we move into the last couple phases, let's talk project management or design implementation, whatever it is that you want to call it based off of. I know there's, like, legalities around it. How are you billing for these site visits now that you're out of design phase. I know that you said if it was flat fee, you gave them a range. Talk to us about how this actually exists when the bill is getting sent and when they're paying it.
[00:49:07] Speaker B: Yeah. So it's going to be kind of in two parts.
Let's start with the easy one, flat rate. So like I said, we have in our proposal, when we're doing flat rate, our minimum amount of site visits that is included in our flat rate. And it's listed out not by the hours, just what it is that we're going to be doing and included in that for our time billing that I'm, I've billed to them in that flat rate is the actual meeting like a hour or an actual, you know what? What, maybe it's 2 hours or whatever. It is usually 2 hours for the meeting and then an hour for follow up. So we always type up meeting notes and send those up. That takes time. And then I do have an hour cushion in there in case we need to like update drawings or we need to like do a new drawing or whatever it is. And then we. So that is already collected in that flat rate. So again, when we start that project, that half of that will be collected when we start and then the other half will be collected when we get towards completion. Now, as we are going through the project, what I do is when we are completing a site visit, so let's say we have completed electrical, we've completed plumbing, we will cross that off so that, and our client can see that, so that they are understanding what is left out of that scope list. Now, if we decide, or let's say they decided to add in something, add a site visit for something. So, for instance, that client that had to do all new electrical, we had to do a site visit that was completely for rewiring the house and like where the electrical, where the outlets were going to be and where the additional lighting was going to be and all of that which we were not planning on. So that would have been probably just an email sent and we would have added that in and that would have been like an hourly charge. Now, when we are strictly hourly, we are basically just time billing them for that project management or whatever you want to call it, site visits, updating drawings, all of that kind of stuff. And we are billing them a monthly time billing invoice with that activity of project management which has really not been estimated. We always say in those estimates that our project management is not included in this because it is very hard for us to understand, but to know that you will have around a minimum of 40 hours, like that line item is there, but again, that can be completely higher, could be lower. It is very hard to fully understand how much time is going to be spent in this particular phase or section of the project.
[00:51:57] Speaker A: So you just gave the example of, you know, in your flat, in your flat v model some, like, if you had to redo a drawing or update a drawing, explain to me how you differentiate between having to update a drawing and billing for a revision. Like what, what would constitute something just being part of that part of that phase versus. It's a. I mean, maybe it's as simple as it's a change to the design or the measurements were different in reality.
[00:52:28] Speaker B: Yeah. So let's say that we picked lights in the design phase. There was no revisions on it. Let's say there were sconces. And so we then do we do the electrical walkthrough and let's say the soffit that we thought we'd be able to remove can no longer be removed. Those lights are no longer going to work or whatever it is. We will, we will make notes of that in our drawings. That is not going to be an additional charge because I have basically accounted for that time into the post site visit time that I have already calculated in that flat rate. Now, for something as simple as that, a light that's going to maybe take us an hour to source five additional lights, and they're going to pick one. I'm not going to charge them. But let's say they decided last minute. Whoa, we don't want any of those lights. Now, for the most part, when we are in project management, all this stuff has been ordered, so there really isn't a lot of, like, big things that we are changing. But let's say that they decided we don't want these lights. They haven't shipped yet. We're able to cancel it. We're going into revisions for now for lights because we walked the electrical and they decided they want a grand chandelier in the entryway now. Right. We will just charge them hourly for those revisions of finding a new light.
That makes sense.
[00:53:50] Speaker A: Yeah, absolutely. That's super clear. Thank you. Okay, let's move into this third phase, if you will. Installation you mentioned when you're charging flat rate, this is getting really build, bundled into that initial design phase, flat rate as well. How are you, how are you charging for install?
[00:54:08] Speaker B: Really?
[00:54:10] Speaker A: What about, like, install prep? I mean, obviously, you don't just show up and everything's ready to go. So how, how are you accounting for this? What are you sort of like budgeting for this?
[00:54:19] Speaker B: Yeah. So both ways, whether we're doing an hourly or flat rate, our, our install phase has always been flat rate. So it's been very easy. Now, before we were doing flat rate day rates and half day rates because of COVID we've gotten out of that again because even though we're still doing half, like maybe we're still splitting up the, the install, but by a couple of installs, we're just never at the house for just a couple of hours. Like it's, it's just not happening. Especially if we're there to help with the install. If we're just getting furniture deliveries and we happen to be there or we decide to be there during those furniture deliveries, maybe it's just like the last couple of pieces. We will probably just charge an hourly rate because yes, those are things we're coming in, just placing down, making sure it's good and we're leaving. Most of the time we're not even there when they are doing those smaller deliveries because our warehouse team has been working with us for so long that they know our drawings, they know where it goes and they're like top tier. So we know it's going to be a great service. So when we are doing actual installs, we are charging flat rate for everyone that is coming from the LBD team to that install. So for the most part, it's going to be. The procurement manager is a non negotiable. Now we, the last is the last install we had. We made that a rule, non negotiable. She is there every time, no matter how big or small the install is going to be or if it's out of state, it is now a requirement that our procurement manager, because before for out of state, our designers would handle it, but no more. So procurement manager now always has to be there. Our designers are always there, whether that's the two of them, maybe one of them, maybe one is staying back to work on another project and then myself. So there's usually three to four people included in that. So when you are doing a flat rate, you need to account for how many bodies is going to be there for that install. It does not include a handyman, it does not include receiving warehouse. It does not include any other people that might be there at install. Those are all going to be separate charges to the client client. So our install prep, let's start. There is a flat day rate, and that is for us to pack up anything that we have at the office. Most of the stuff does go to the receiving warehouse, but there could be stuff that we pulled from the store.
Usually all accessories are pulled from our store. So it's bins of accessories. If it's a ton of bins, our receiving warehouse will come pick that up. But if it's not, we're put. We're loading that into our car. We're loading our install kits into our car. Maybe there's smaller pieces of furniture that we had delivered that we're loading into the car. We're printing out all the design boards. We're printing out all the drawing boards. We're making our handyman list. You know, all of that prep is a flat rate and that's a smaller rate. I think our rate is $1,800 for that because everyone, usually, except for me, I'm not doing a lot of prep, but usually everyone is included in that. Then our day rate, which is, I think, 3200 or 3500, I can't remember. Still right in front of me, is for, like I said, everyone on the team, and it's for 8 hours of working.
So it can be getting there at 08:00, leaving at 05:00. If we decide to stay until 10:00, we are adding an hourly fee from five to ten to that install invoice. And that is, like I said, you have to map it out very clear what this includes and what this does not include, because a lot of people might go like, oh, it includes the handyman, or, oh, it's going to include the receiving warehouse, when in fact it doesn't. And then we will do a minimum. Now, we used to just be like, oh, it's going to be one day. Well, our install is never really. It's a minimum of two days if it's a big project. If it's like a full home, it's a minimum of two days. If it's not a full furnishing job, then you can put a day. But we usually do a minimum of two days because we just know it's gonna be very difficult for us to, like, get the furniture in there. Clean up style, have the handyman come. Usually handyman takes two days. Like, there's no way one handyman can hang like 30 pieces of art and like, anything else you need, but it includes, it includes. So it does not include those half days anymore.
[00:58:34] Speaker A: Okay, so that really completes everything. I'm assuming right after install, you've scheduled your photo shoot, your video shoot. Maybe there's some overlap there. Your last install day, you've been able to start photos, just, just bare bones to clarify the time that you're spent at the house for a photo shoot that has never billed back to the client, correct?
[00:58:55] Speaker B: No, those are our marketing dollars, unfortunately.
I wish I could build a client, but no, it is. Yeah, that is strictly something that we pay out of pocket. That is, like I said, in our marketing budget. That is also something overhead wise, we are looking at the beginning of the year and tracking how many projects are finishing this year. How many of those projects are we going to photograph? Maybe we're not going to photograph all of. Maybe we're going to do video for just one or two of them. So we'll try to plan that as much as we can and then cushion that as well for any new projects coming in. That might just be a quick furnishing, like, turnaround job.
But yeah, that does not include any photography, any videography, any marketing materials, any florals, like anything photoshoot wise. And yes, we will try to do that as close to install as possible, but sometimes that doesn't happen as well. And we have to account and we might have to come back the day before photoshoot and restyle the home. Maybe because we're doing it like a month or two months later. We will not charge the client for that time as well. Like, that is all for us to capture.
[01:00:02] Speaker A: Great. Lindsey, that was amazing. It's so cool to see how you've shifted or how you're considering shifting. I know it's still kind of like an in process transition in hindsight, and I know it's newer, but what do you feel are the benefits of offering the flat rate option? And how is that being, like, received by your clients? Why is this something that you are considering?
[01:00:27] Speaker B: Um, okay, be really honest here. We had, last year was a really hard year with clients, even some of our best clients. And I don't want to, like, if our clients are listening, like, it wasn't that they were being difficult. It's just that our economy is changing constantly and industry is changing constantly, and you have to be adaptable to that. It doesn't mean that we're going to be charging this way forever, and it doesn't mean that there's not going to be tweaks along the way. But for a while, I was very closed off. And to me, I was like, why? I had to do a really deep dig into, why do I not want to do flat rate? Most of it was like, I'm going to be burned and I'm not going to make the money. But at the end, last year, when our clients were coming back and they were asking us so much, and I'm very good about having conversations about money, very good about talking to them about their budget along the way. But sometimes, like, when you are running a business and you are managing a ton of different things, and I have a ton of different revenue streams and different aspects of my business, yeah, those things kind of fell by the wayside and, like, it was not giving my clients a good experience. And I also think even our clients that have big budgets for their projects, they're still going to manage and understand, like, very rarely do we have a client that's just not paying attention to what they're spending. Even if they're spending a million plus dollars, we're still understanding what that money is going towards. So it made more sense for me to switch to a flat rate because it felt like a more elevated client experience for our clients. I'm at the point in my business where I know the information. I've been doing this long enough to now know and have my designers with me long enough now, luckily, that I know what it takes for them to do a project. And so there was no reason anymore for me to not try it this way when we were having so many, I want to say, issues, but just challenges with the other pushback. A lot of, you know, hourly is really great because it covers you, but it does sometimes leave a bad taste in clients mouth of like, you know, oh, you're charging me for getting, you know, getting on the phone with you? It's like, well, yeah, I mean, we were on the phone for an hour and a half, like, and sometimes I won't charge for those things if it's something that we're discussing because it was based off of something we did wrong or we didn't give enough clarity on, and we're explaining to them, I'm not going to charge them for that, but, like, I also have to hold my clients accountable because otherwise they'll walk all over us and try to get everything, you know, for free. And so I can't let that happen, too. There's this, like, real delicate dance when you're doing hourly to make sure that you're getting paid what you need to get paid and what the client sees as a good experience. So I just really felt like going to a flat rate and going to a flat rate where I felt comfortable doing the flat rate was going to be a better experience. For my clients. So I really kind of just evaluated what looks, what's the best experience from our client perspective and the way that we were charging, which procurement has always been a good client experience for us. So we kept that install flat rate. Everyone loves that. We're just now making our minimums higher for that. And then the hourly rate, it was really the project management that was a big one, defining what our minimum hours for that was doing those activities. And again, it's all from learning experiences. Right. We had a client come back and say, I need, I want to know what you spent on project management alone. I had to go print their invoices and highlight every item, every line item. That was project management. And that was the one thing that made me go, we're doing activities now for time billing because I'm not spending the 2 hours because guess what? I couldn't charge the client for that took me 2 hours to highlight this project. So it was a new build. It was awful. So I think you have to take your past experiences, you have to see what is the client experience that you want to provide to a client. For me, we're doing large scope. It just makes more sense. I think if it is a smaller scope of work and can be more manageable to manage those hourly, I would, I might stick there, but those are just not the projects that we are doing right now. And I also think that right now, with the economy and people being a little bit more resistant to spend, they're still spending, but they might be a little bit more resistant. This makes them feel better as well, too. And that, you know, that you're guaranteed a certain amount of hours. And I will say what I decided to do with this is we went through our process and our systems with like the finest comb, and we said, if we're going to go to flat rate, we're taking this out of our process. We're not doing this. We really looked to see where we're doing double work. And an example of that was our project binders for clients no longer doing project binders. So, like, which we can get into when we like, do another episode or whatever. But I think that when you're doing flat rate, it's not only understanding the pricing, but it's understanding your process too, to make sure that the amount of hours that you're allocating yourself for that really matches what your process is.
[01:05:52] Speaker A: Yeah. To audit. To audit the time you're spending makes so much sense. Okay, last question before we wrap up. Kind of rapid fire. We talk a lot about this at design camp, especially recently. We're going to be back at design camp in Austin this August. But we're talking about how to increase profitability without increasing your hourly rate because eventually you price yourself out of the market. You cannot just keep increasing your hourly rate. So quick, rapid fire. Give us three examples on other ways to bring in revenue without within traditional design services without just upping that hourly fee.
[01:06:29] Speaker B: Biggest thing, product.
You can, you cannot survive on just fees alone. We can't. I think, honestly, I think we should do a whole other episode on trade vendors. I'm telling you, pricing can be like ten episodes. It could be a whole season, Stas. So just pricing detailed out. But product, product, product. I don't care if you're getting stocking dealer or just designer dealer, dealer. And you can still be providing a discount to your client if you want. Everyone wins. Everyone makes more money that way. Anytime that we need to really, we might say, hey, we need to really make a lot of more money. Like right now, like, we are really looking into our margins and seeing where we, certain vendors, it's not going to be like, okay, we're just now going to like charge another 10% to everything. It's just certain vendors that we might get better margins at that maybe we give a lesser discount to client or whatever that is. Because at the end of the day, the client's still going to get a discount. Right. And so they're still going to be happy, but we're going to make money. We're not then upping their hourly rate. So it really has no effect on the client. So that's number one. Number two can be, it can be anywhere where maybe you are not making any extra money. So for instance, look at your expenses and see what are the expenses that you can possibly make a small profit on. So receiving warehouse. A lot of people just pass that right on to their clients. We did that for a very long time, but we do now markup on that. It's a very small markup, very minimal to where it's not changing a huge impact to the client, but it does change a huge impact to us. Now. We have, we have, you know, we're very lucky to have a storage area where we can accept smaller pieces of furniture, we can hold accessories. And I mean, before I was here, that was my garage, right. And a lot of people are like this. We do not charge any storage for our clients, housing things at our office. So there's no additional line items to say, hey, you, you might have a sofa in our office, you might have several dining chairs, you might have six bins of accessories or whatever it is. Wallpaper, lighting, plumbing, all of that that we're housing, we never store, we never charge them for that storage. Our markup on the receiving warehouse covers us for that. So even doing a small percentage of that, you will see a big difference, especially if you do do a lot of furnishing jobs. So even just marking up 5%, 10%, not a big, not a big fee for your client, but it could make a dent in your profitability.
I do know a lot of people mark up on shipping. We're not there yet, but that could be another possibility, too. So kind of seeing, like, where your expenses are, your handyman or wallpaper guys, people like that, you do have to be a little bit careful because that can fall under, like, construction and, like, we're not really able to do that. Um, if it's just like a trade, like a tile guy, like, you know, we're not, we're not the contractors handling that, so be careful with that one. But. And then number three, I would say if you can break out your pricing kind of like how, not necessarily how we do it, but kind of into phases, and maybe some of that is a percentage, some of that is a flat rate, some of that is an hourly increasing that just a little bit, even increasing your rate just $25. Or maybe you're going from charging the client different rates for your team to one rate. That's going to be a huge difference. And then I'm going to add in a fourth one. But evaluating your overhead and looking at where you can save, not just on actual, like, maybe you don't need this software, maybe you don't need to, you know, do lunches every week, and you can go down to lunch every other week or whatever it is, but also going through your process, like I was saying, and taking away things that you're spending time on that you don't need to do binders is a huge one. We were spending money on binders and on tabs and on printing paper and on ink. Like, all of that adds up. And then we were spending double the amount of work, basically taking everything that's in our spec book that we're digitally giving and having this binder that we were having to update all the time, and then we just kind of, we're done with it. So it's a win win for that. That's like a great example as far as, like, that time is now getting spent back, really being able to be billed to the client in another way.
[01:11:02] Speaker A: Amazing. Lindsey, as always, you just hung every star in the sky to me. You are so brilliant. I am so grateful for your candor. I love getting to walk by your side at design camp. I will see you in August. Thank you for joining. And I I'm going to email you because we got to get you on here quickly. I can't even wait for the next season. I'm like, no, we got to keep going.
[01:11:25] Speaker B: I know. Thank you for having me. And I, you know, I can't take all the credit. Like I said, these wonderful women and men who come to design camp, they light the fires in me to want to change things in my business as well. And that's what I think is so great about design camp is that we are constantly changing the things that we're doing. And guess what? We're going to be teaching all of this stuff in August that we didn't have the last time because we didn't have an implemented. So, yeah, I'm happy to always share what I am doing and what is working, what is not working, and maybe the next time I'll come back and be like, screw that. Flat fee was sucked and I didn't like it. But again, what works for me is going to work for someone else. So I think, just like, you do such a great job of just providing our industry with so much information, and I just, like, can't tell you I love doing design camp with you. It's like, one of the main reasons why we just keep doing it is because we know how important it is to our industry to, like, share the knowledge and have other people share their knowledge and have it just be this, like, huge community driven industry where we can all make money and provide great client experiences. So I love you for providing that. You are a huge. You are a huge part of that. And of course, I will always do design camp with you. Always and always and always until no one wants to come again.
[01:12:42] Speaker A: Well, thank you so much. I will see you in August, and I'll talk to you in five minutes at our next meeting.
If you are interested in learning, learning more from Lindsay, design Camp is an incredible opportunity to see the exact inner workings of her wildly successful interior design business. Tickets were just released for our August event, headlined by none other than Jeremiah Brett, Zoe Feldman, Beth, Diana Smith, Tyler Farrell, and Kristen Forgioni. Our curriculum is always evolving just as the industry is, and it's an investment that will pay for itself tenfold. You can find details about our next event at Designcamp co linked in the show notes. You can also make sure to be following along with Lindsey at lindseybrookdesign on Instagram and get more in depth process tutorials on her
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[email protected]. the interior collective if you loved this podcast, please leave us a review. It means so much as we get ready to start recording season five of the interior collective. If you have questions or topics you'd like to hear next season, email me at podcastidcode studio. Again, that is podcast studio. Until next time, I'm Anastasia Casey and this is the interior collective.
