How to Make More Money as an Interior Designer, or The Who, Where, What, and How of Working With Int
There are two types of Interior Designers. Those who charge only for their design time, and those who want to make real money as a designer. That might sound a little harsh, but I just don’t understand why a professional business person, (that’s what a designer is after all) would ignore a major source of revenue, like buying and reselling elements of their design.
Whether it’s because they fear of the unknown, think it’s too much extra work, or feel guilty marking up furniture to resell to their clients, it doesn’t make good business sense.
Let me shed a little light on the who, where, what, and how of working with wholesale vendors, and demonstrate just how much more money you could be earning each year when you open your own vendor accounts.
Who are these vendors I speak of?
All manufacturers, whether they make furniture, fabric, lighting, or accessories are considered a vendor. There are hundreds of thousands of vendors around the world, creating beautiful furnishings for designers to use in our designs. But how do they get their work in front of as many interior designers and store buyers as possible?
The easiest way to accomplish this herculean task is to display their wares alongside other manufacturers in a market like setting, to entice a larger group of designers to shop.
This means that almost every product made in the world will have a location where you can view a selection of their work in person either at a design center, a permanent showroom, or at an industry market, to make it easier to buy their products at a “wholesale price”.
Where Can You See These Vendors?
If you’re lucky enough to live near a major design center then you can basically shop for wholesale vendors like you’re shopping at a mall.
Showrooms either represent a single furniture or fabric manufacturer, or they represent a variety of vendors under one showroom. Simply ask for a list of their vendors, or if you find a vendor online that you’re interested in, you can locate which showroom they’re represented in and where.
If you find that your nearest showroom isn’t very near at all, then you could try a virtual design center like www.designtradeservice.com. Full disclosure, I helped them create their original concept and website so you know that they care about your success. They’ve grown to be an amazing resource for designers.
You won’t be able to see the products in person, but you’ll have all of the same perks and discounts that a traditional showroom would offer and more. Being a member of their site allows you to purchase from companies that won’t work with independent designers at all. (If you mention that I sent you, you’ll get the Design for a Living VIP service!)
If you're a touchy-feely person like me, then you’ll want to attend one of the interior design industry markets. There are 4 major markets in the US; Atlanta, Dallas, Las Vegas, and the “Big Show”, High Point North Carolina, as well as a few smaller events across the country. Each market opens twice a year and only members of the professional design industry may attend.
I highly recommend that you visit at least one market during your career. The pageantry and hard work that goes into each event is awe inspiring. These temporary showrooms are more impressive and expertly merchandised than any retail store you’ve ever been to. This is their shot to impress you and make an indelible mark on your creative process.
Remember that every vendor is competing for your attention in this huge chaotic event, so they really make an effort to wine and dine you into choosing them over their competition.
All of these showrooms have sales people just like any store, who are there to teach you about their products and help you place orders directly from their factories. Don’t be afraid to ask questions.
What Does a Showroom Do?
Wholesale showrooms are not in the retail business. They represent companies that make the furniture, and it’s up to us to re-sell it to our clients. That’s why most showrooms are only open to professionals, and not to the general public. (Some showrooms will allow the public access but will not sell to them or display prices unless they can prove they’re a professional designer.)
The intention of a wholesale showroom is to make it easier for designers to buy directly from the manufacturer and then resell it to their clients at a higher price. It’s not their intention to provide designers with cheaper prices to pass on to their design clients. If that was the case, there would only be one price for everyone whether you’re a large furniture store, an independent designer, or the general public.
How Can You Make More Money Using Vendors?
Every interior designer should be charging a fee for their design talent and time as a basis for their income. The way that you turn that basic income into a profitable career, is by adding multiple income streams like opening and buying from wholesale accounts.
Vendors will offer a variety of prices based on how much you’re going to buy. The most common pricing structure is as follows:
MSRP, Manufacturer's Suggested Retail Price. This is what vendors believe their product can fetch in a normal retail market. Think of this as 100% price.
Designer Pricing is for interior designers like us. We usually buy furniture in ones and twos, so they want to offer us a discount, but it’s limited. Expect 40% off of MSRP.
Stocking Dealer Pricing is for those buyers who have a retail location. Usually you’ll be expected to maintain a certain number of pieces from their collection on your display floor to get these deep discounts. This low price allows for a store to put their products on sale now and then. Typically it’s 66% off of MSRP
Container Pricing is reserved for those buyers who plan on buying an entire container load of their products. If you’re able to buy at deep, deep, discount, that means you must have a really big store. It also means that you’ll be able to re-sell these pieces to other designers at a discount, to entice them to buy from your store or showroom. This price is usually negotiated.
Now how do you use this benefit to make more money?
First things first, don’t feel guilty, slimy, or sneaky for marking-up furniture. I know there are interior design coaches out there who teach that you don’t need to hassle with mark-ups. I disagree. Our entire economy is based on this premise.
I understand, it requires a greater attention to detail in your paperwork and bookkeeping. You’ll need to spend the time opening your accounts, maintaining your catalogs and price-lists. (A good sales rep will make this easy.) You’ll also want to visit their showroom to test drive the quality, see the finishes and fabrics, and start a relationship with your new partner.
But sometimes that little bit of extra work can translate into huge increases in your income.
Let’s say you find the perfect dining table for your new design project. The MSRP for this table is $1500, and your client might see this table at a local store for $1300, $1200 on sale. Remember, they’re purchasing that table for $500 so they have room to lower the price.
Now as an independent designer, you can purchase that same table for $600. Even with shipping at 20%, (this is a high estimate) and receiving and delivery charge of $100, you can offer your client the same discount and earn $400. That should cover any extra work I think.
Now imagine how your income can multiply with every piece you select?
Not only are you earning more money to your bottom line, but you’re adding value to your services. By offering your clients unique design pieces they can’t buy on their own or at any big box retail store, you’re able to create one-of-a-kind designs.
You can also expect to find a higher level of quality of furniture in a showroom. Think of how much an investment a company must make to provide you with a physical space to view their products. They reserve that luxury for a us designers who have a much more discriminate taste.
There is One Catch.
If you’re planning to actually purchase the furniture for your clients and place orders, handle the delivery, and deal with returns, then you are a product driven design consultant. You should be charging an hourly fee and a percentage of the products you use in the space. This money can either be a service fee you charge the client, or a designer discount offered by the supplier of the product.
Simply put, this means that you can charge more for your design time and pass on a larger discount for your client, or keep your hourly fees lower (which could help if you’re designing in a competitive market), and keep your discount as part of your income.
There’s a lot of extra work involved in tracking special orders, so you must charge for the additional responsibility and liability involved in this type of design.
I'm not trying to discourage you from being a product driven designer. It can be extremely profitable. Just be aware that you must be much more organized, and have excellent attention to detail to be successful as this type of designer. (Learn how to overcome these challenges in my Design for a Living Success Studio.)