Dear Sean,

I’ve been in business for 22 years in North Carolina. We are a team of five, including me, an interior designer, a design assistant, a studio manager (part-time), and a client relations and marketing manager (part-time). We are strictly a residential interior design firm and enjoy mid-to-high-end new construction, renovation and furnishings projects.

The struggle I’ve been having for several years is getting hired by the high-end builders in our area. We’ve been hired directly by the homeowners, almost exclusively. We’ve met some great builders along the way, but when I share our pricing with them, I’m told that we are much more expensive than the other designers in the area.

I’ve listened to many podcasts and webinars about how to price for new construction and have tried to follow those guidelines. However, it seems that the designers in our area are using very old-school pricing structures and are just not charging enough! It also seems that the other designers are likely not providing the level of service that a true full-service designer offers in new construction (lighting plans, elevations of all bathrooms, tile layouts). I can’t seem to find the sweet spot of pricing and services that will land us some steady builder work.

I don’t know any local interior designers who are successful in this segment of work and would be willing to share some insight, as I would be their competition! Any suggestions for me? I’d love to get serious about approaching some new potential builder clients, but I don’t want to blow any opportunities with pricing issues.

Courting Construction

Dear Courting Construction,

Ask yourself: Expensive relative to whom? As you say, you do what many other designers do not, and yet you are being compared to them. That is like saying the fancy steak house that happens to serve a great hamburger has to defend its prices against McDonald’s. Your answer has far less to do with pricing than you think, and much more to do with the actual business you are in. I am presuming you are fee-based when it comes to construction and are not providing materials that contractors would otherwise procure (and profit from). You might make a percentage on decor, but not hardscape items. For your (ongoing?) fee, you provide interior architecture design and project management support (including supplying schedules and plans, as you describe). My question is: What are you doing to improve the contractor’s business?

First, let us back up and talk about the role that many interior designers play today in interior architecture. While an architect focuses on the structure of the house, interior designers like you are arguably the very best professionals to talk about what happens as soon as the door opens. Given the technology today, interior designers are as proficient in producing support for all interior architecture decisions as any architect is. Your business is proof positive of that.

It means that you can step in to work with high-end contractors to incorporate elements that will benefit the project and work for the contractor. For instance, instead of focusing on the best tile out there, you will focus on the best tile supplied by the contractor’s preferred vendor. I presume there is no nefariousness here, only the healthy relationship that exists when professionals have done business with each other over many projects. Also, high-end contractors have no more interest in substandard products than a chef does in using poor ingredients. That is, if they wish to stay in business. Approaching contractors and telling them how you are going to be the best partner to assist them in providing excellent guidance for clients will more than justify your fee.

As a residential designer, you are not in the efficiency business (more for less). You are in the effectiveness business: Your firm maximizes the client’s enjoyment of the investment. If you do not like the word enjoyment, then go with value, so long as you think of it in rational terms. Certainty, confidence and thoughtfulness are the hallmarks of effectiveness.

Competing on price is a fool’s errand. As Seth Godin would say, it is a race you do not want to be in, let alone win. More to the point, by allowing yourself to be compared to designers who do not do what you do, you are validating the comparison. Simply say that you are not in the same business any more than the high-end steak house is in the same business as McDonald’s. Then focus on what you can do to be the agent of change you are meant to be.

Effectiveness provides clarity; clarity reduces risk for all involved and allows you the opportunity to be the only professional tasked with seeing the entirety of the project and the integration of all things architecture, interior architecture, construction and decor. Do not just think outside of the box. Erase it.

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Sean Low is 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.