One evening in the mid-1980s, Tom Scheerer, a recent architecture school graduate, went to a cocktail party at Bemelmans Bar inside The Carlyle—it changed his life. There he met Jeffrey Bilhuber, an employee of the hotel, and the pair decided almost on a whim to try to do a room together at the Southampton Designer Showhouse. They got in, and the pool house they crafted was a hit, launching their firm with a bang. Seven years later, the partnership ended, but Scheerer was well on his way to a sparkling career that would see him complete projects around the world, pen two books (another is forthcoming), and land a regular spot on both Elle Decor’s A-List and the AD100.

“The plan at one point was to be an architect, and then it was to be some kind of developer,” Scheerer tells host Dennis Scully on the latest episode of The Business of Home Podcast. “But then the decorating business snowballed. And, as you may know, you can make quite a bit of money decorating if you do it well and you’ve got a head on your shoulders. So, it turns out that I ended up with a pretty big decorating business.”

The designer does not have a “look” exactly, but his rooms have a kind of lightness, simplicity and focus that carries over to the way he has run his business (and has lived his life). For example: Intricate, expensive fabrics? Not a fan. “I can buy fabric at Calico Corners, if I have to—fabric does not make a job.” A large firm taking on dozens of complex projects? Pass. “I went to every client meeting. That’s important.” A wardrobe full of designer clothes? Scheerer is rarely seen in anything aside from a lavender gingham shirt. “When I get up in the morning, I put on the same thing every day. It’s one of my tricks.”

Now Scheerer is declining new clients, closing his office, and passing on work to his employees. Naturally, he’s taking a simple approach to the transition. No attempt to create a multigenerational firm, no intricate succession arrangement—just a simple profit-sharing agreement and a gradual stepping back from the day-to-day. “I’ve worked with so many of the same clients for so long that they’ve become dependent on me,” he says. “I just basically have to say, ‘Listen, you’ve got to find somebody younger. It’s time for the next generation.’”

Elsewhere in the episode, the designer talks about the importance of being flexible on pricing, how the internet has made things difficult for great designers, and why the best way to vet a client is to tell them a joke.

Crucial takeaway: Unlike many designers of his stature, Scheerer has never gotten deeply into the world of licensed product. That’s largely because he saw it as pulling him away from the more rewarding, lucrative business of running a design firm. “I’ve been asked over the years, ‘Why aren’t you doing that?’ I don’t care that much about [product]. And I know there’s been a lot of wheel-spinning in that arena, a lot of promise that one could get rich doing it,” he says. “[But] there’s a lot of money to be made in decorating if you have the right clients. [Pursuing licensing] has been a distraction to several of my friends, and they lost their focus.”

Key quote: “It’s a whole life being a decorator. You meet people, you travel with them, you get to know them really, really well. It’s fun, and it’s an important part of the job—maintaining those relationships,” says Scheerer. “It’s really about trust and that level of transparency: You can’t make the clients understand unless you spend a lot of time with them. … There might be a certain level of mistrust built into the business because of the markup system and the billing hours, which always seem crazy, even to me. It takes a certain amount of massaging to get people to understand what they’re paying for.”

Listen to the show below. If you like what you hear, subscribe on Apple Podcasts or Spotify. This episode is sponsored by Spring Street by Pollack and Crypton.

The Thursday Show

BOH executive editor Fred Nicolaus and host Dennis Scully discuss the biggest news in the industry, including Williams-Sonoma’s latest earnings report, rising homebuilder sentiment, and a look at why so many independent furniture stores are closing. Later, New York Times real estate reporter Debra Kamin joins the show to discuss her reporting on the stunning NAR settlement that will upend the way homes are bought and sold.

Listen to the show below. If you like what you hear, subscribe on Apple Podcasts or Spotify. This episode is sponsored by Loloi and Chelsea House.