I live in California, where Governor Newsom has announced that the economy will fully reopen on June 15, and the feeling of rebirth has brought a rush of clients to my door. I am very grateful, and also totally overwhelmed. I run a small firm of five people and do not want to race to hire a ton of new people to meet the demand. How do I choose which projects to take and not feel like I am letting down those I cannot help?
Too Much of a Good Thing
Dear Too Much,
I can totally relate and understand where you are with your design business. The United States (and many parts of the world) have indeed started to reopen. While I thought that COVID would lead to a surge in the interior design business, I was wrong—it is far more like a nuclear explosion.
It would be easy for me to just say that you should raise your prices to accommodate the new demand. However, that would be going against every fiber of my being when it comes to creative business.
Design businesses are scarcity businesses, not capital asset businesses. Capital asset businesses, like hotels, are use-it-or-lose-it. If someone wants to stay at your hotel during COVID and only wants to pay half price, you say yes because the room will be empty otherwise. And if demand outstrips supply, you raise prices accordingly—post-COVID, the same room on the exact same day might be 10 times the cost.
In a scarcity business, on the other hand, you do what you do for the people you care the most about, and vice versa. Those you care most about seek your very best work. To honor this bargain, you need to know three things—how much money you need to create your work, how much it costs to do the work, and how much you would like to work.
How do you go about finding those numbers? What you need is about how you want to live your life. That includes expenses like your rent or mortgage, but also coffee, clothes, vacations, savings—not a budget, but a number that represents what you want for your life as it is now and in the foreseeable future, and that you need in order to feel good about the work you do. The cost to do that work, then, is the sum of what all it is going to take to get your number: employees, an office, professional expenses, marketing, and so on. Those numbers combined are what your business needs to generate for you to live the life you would like—that is the numerator. The denominator is just how work you want to do in order to get that number.
Let’s use small numbers as an example: If you need $100 to do your work, it costs you $150, and you want to work on five projects a year, your price is $250 divided by five, or $50. How you go about getting that $50 is the topic of another column, but $50 is the right number, whether you are swamped or there are crickets.
That number is not static, though, as you might decide you’d like to work more or less. You might also decide that you want to make more or less. It is all about pricing from the top down. For now, let us presume all is good financially and five projects a year with your current team makes you happy, so $50 it is. With price out of the way, you can now focus on what really matters—doing only your best work and making sure that you would be willing to stake your reputation on whatever work you do. Meaning if the project was the last you did, you would be willing to rest everything on it.
Using the metrics of only your best (on your terms, of course) and the work you would stake your reputation on allows you to make decisions that will set the stage for the future while honoring what is in front of you. That said, you might very well find yourself with more perfect projects than you can take on—on this point, I have to remind you that if you are in the business of not disappointing anyone, you will disappoint everyone. Choices are hard, and the one whom you do not choose will be disappointed. Just let that be. Please do not try to find a replacement for your services or even to try to delay starting. Neither strategy will work well, as you are absolutely saying to this client that they are not as important as the one(s) you have, in fact, chosen.
The essential thing to do when having the blessing of more opportunities than you can handle is to push the edge. Be more radical in what makes you you. Focus on improving the experience, the narrative of the stories told by both your art and your design business. Let these changes, these new commitments, be what you carry forward when the future arrives. It is a fool’s errand to maximize today at the expense of tomorrow, especially when tomorrow shines as brightly as you will allow.
Homepage photo: ©Chartphoto/Adobe Stock
Sean Low is the the go-to business coach for interior designers. His clients have included 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 Business Advice column for BOH, he answers designers’ most pressing questions. Have a dilemma? Send us an email—and don’t worry, we can keep your details anonymous.