business advice | Apr 10, 2018 |
How do I explain my new pricing structure?

Dear Sean,

Last year, I decided to stop charging by the hour and instead charge a flat fee plus a percentage on purchases for a client’s project. It has been going great! However, one of my old clients has come back with a fantastic new project and told me she expects the pricing model to remain the same. I do not want to go back to hourly with her. How do I best explain my business model switch?

Don’t Want to Turn Back Time

Dear Don’t Want to Turn Back Time:

We all evolve. It is the nature of things, and your design business is no different. While we all may wish for a time past in some aspect of our lives, business demands that we ever become the best version of ourselves. My guess is that you are not carrying around a flip phone today.

Celebrate the new you with the idea that you switched from hourly not because of what hourly did not do for you, but for what the new model does do for you. For instance, since you pride yourself on your ability to present your design ideas to your client, charging an hourly fee undercuts this effort since it places the value on your time investment in the idea versus the actual idea itself. A flat fee to create is, therefore, a much better way to value the idea if presentation really matters to you as a designer.

We all invest in what we value. Those who would buy an ultra luxury item would never say the item was expensive, only that it cost a lot of money. Expensive means it is not worth it. Costs a lot of money refers to what it takes to get the value you seek.

If your client is as I suspect, your willingness to describe and honor your value today in a way she can see really matters to her will be all that she needs to sign on with you again.


SEAN LOW is the the go-to business coach for interior designers. His clients have included the likes of Nate Berkus, Sawyer Berson, Vicente Wolf, Barry Dixon, Kevin Isbell and McGrath II. Low earned his law degree from the University of Pennsylvania, and as founder-president of The Business of Being Creative, he has long consulted for design businesses. In his monthly EAL column, he answers designers’ most pressing business questions. Have a dilemma? Shoot us an EMAIL—and don’t worry, we will keep your details anonymous.

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