Choosing the best pricing model and knowing how to charge for interior decorating can be challenging.
You need to consider various factors before you decide, so it’s important to spend time developing your fee structure.
You want to be fair to your client, but you must also ensure your business operating costs are covered.
Plus, you want to make a profit too! After all, that’s why you’re in business!
Setting a fair and competitive price is essential to ensuring a successful project. In this article, we’ll explore the different pricing models for interior decorating, each with its benefits and drawbacks.
We’ll also look at the key factors to consider when invoicing clients.
When choosing the right pricing model it’s essential to consider:
- the project size
- what’s involved
- how much time is needed
- geographic location
- your competitor’s prices
- and the client’s budget.
Of course, this can also be customized to each project based on what works best for you and your client.
So, let’s learn how to charge for interior decorating.
Option 1: The Hourly Approach
Charging by the hour is one of the most common pricing methods for interior decorating.
However, this is best suited for smaller projects or when the scope of work needs to be better defined.
The decorator charges the client based on the number of hours worked on the project. Remember, not only are you charging for time on-site at the client’s house, but also the following factors;
- Time driving to and from the client’s house, including your fuel costs
- Researching and planning the project
- Preparing the designs, quotes, and invoices
- Sourcing materials, products, and other items for the project
Once you have determined how many hours you’ll spend on the project, you need to work out your hourly rate. This is entirely up to you, but it needs to be competitive. Plus, it needs to cover all your general business costs.
Some of the general business costs to factor in are;
- Marketing & website costs
- Office supplies and stationery costs
- Phone & internet costs
- Rent, insurance, and utilities
- Other general business costs
Based on all these factors, if your hourly rate is $50 and you work 20 hours on a project, the total cost to the client would be $1000.
You will need to give your client an estimate of the hours for their project and your hourly rate. However, sometimes projects will exceed the number of hours you have estimated. Therefore, it’s a good idea to add to your agreement that any additional time will be charged at your hourly rate. Then you can advise your client of any extra hours needed as the project progresses.
This pricing model works well for some clients, but others may prefer a fixed flat fee. This is so they can budget for your fees, particularly on larger projects.
Option 2: The Fixed Flat Fee Option
Charging a fixed flat fee is one of the most straightforward pricing methods for interior decorating services. This is ideal for projects that have a well-defined scope of work.
A flat fee is a fixed amount agreed upon for the entire project, regardless of the number of hours worked. So, for example, if you decide on a fixed flat fee of $3000, the client will pay $3000, regardless of how many hours you work.
This fixed flat rate approach sounds simple, but you must factor in all your costs. As with the hourly rate, ensure you cover your time in the office, travel, and general business expenses.
You are still calculating the project’s cost based on the hourly rate method, but you are presenting it as a simple fixed flat fee.
This is an excellent option for your clients as it allows them to budget for your fees. The downside can be if you undercharge and end up working more hours than expected.
Option 3: Room by Room
Pricing per room is a simple way to charge for interior decorating. First, you will know how much work and time you need for each room. Then, you can use this information to create your pricing for each type of room.
Charging for a small bedroom or hallway will be significantly less than charging for a main reception room or bedroom.
When you factor in all your costs, you’ll unlikely want to decorate a small room and nothing else. Therefore, you can specify that you require a minimum number of rooms decorated to make the project worth your while.
Pricing room by room can be practical, but not if the client only wants one room decorated.
Option 4: The Commission Model
In addition to choosing one of the pricing methods above, the decorator may also charge a commission for sourcing products.
This model is best suited for larger projects where the decorator will spend significant time sourcing and acquiring items. For example, if the items cost $10,000 with a 10% commission, the client will pay $11,000 in total.
This is a typical method for interior decorators since it allows them to profit while offering meaningful service to their clients. It’s an excellent way to boost earnings on a project, and most clients will appreciate this time-saving service.
Option 5: Package Deals
A package deal is a fixed-fee pricing method that includes a defined scope of work, materials, and products. This method works well for clients who want a specific look and want to avoid the hassle of selecting individual items.
For example, if you offer a package deal for decorating a single room which includes your time, materials, and products for a fixed fee of $4000, the client will pay $4000 for the complete package.
This may seem straightforward, but a lot of work is involved to ensure you don’t underprice the project.
Timely and Accurate Invoicing
Invoicing clients promptly and accurately is critical to maintaining positive client relationships and getting paid on time. It is also an important aspect of running a successful interior decorating business. Therefore, it is essential to ensure the invoices are clear and accurate and include all relevant information.
Whether you are charging an hourly or fixed flat fee, you need to consider how often you are paid. For example, will it be once the project is completed, or is it better split into stage payments? Stage payments are the best option when it’s a large project which will take several months.
Stage payments enable the client to make payments at various stages of the project. This alleviates any financial pressure of paying for the entire project at once. It also provides a clear timeframe for the project and helps keep it on track.
Keeping a few factors in mind when invoicing clients for interior decorating projects is essential.
- Timing: Ensure that invoices are sent promptly and on a regular schedule, such as at the end of each stage of the project.
- Accuracy: Double-check the invoices to ensure they reflect the services and materials provided.
- Clarity: Ensure that the invoices are clear and easy to understand, including a detailed description of the services and materials provided.
- Payment terms: Include payment terms and due dates on invoices and consider using a payment gateway for secure and efficient payment processing. Offer options such as stage payments to make it easier for the client to pay.
- Legal requirements: Familiarise yourself with local laws and regulations to ensure invoices comply with these requirements.
The key is determining which pricing method works best for you, your business, and the client’s needs. Remember to consider all the factors involved and be flexible where necessary.
It is also essential to communicate with your client and be transparent about your fee structure and invoicing process. This will help to establish trust and build a positive working relationship with your clients, ensuring a successful project outcome.
It’s equally important to have clear lines of communication with your client. So, regularly update them on the progress of the project and any changes to the estimated costs. This will help to avoid any surprises or confusion when it comes to invoicing and stage payments.
With these considerations in mind, you should have a better understanding of how to charge for interior decorating and can develop a fee structure that is fair and profitable for your business.