“Budget-talk” Gets a Boost
Budget should be on the agenda when design professionals meet with prospects.
That’s the view of most of those who weighed in on my remark in a recent blogpost that budget questions limit your prospects’ thinking — and your income.
Most of those who commented agreed with Phil Norman’s opposing view that focusing on budgets is the right way to go.
Here’s a sampling of the emails that came in:
I think budgets can be a double-edged sword: some clients have a grasp of what their entering into (and thus what a project might cost), and others don’t (how many clients bought the sofa, but didn’t buy the drapes, thinking they were too expensive?).
By talking about budgets early, a designer can start the education/qualifying of a prospective client, but it can backfire – you might downsell. With new or younger clients, talking about money is pretty key – you want to let them know you’re not shopping at Crate & Barrel – unless you actually are. With older or more experienced clients, talking about budgets is less important, as they most likely know some parameters of the project (they’ve been around the block).
I think you both might be right – use budgets to weed out & tailor the project, but also don’t allow them to be a limiting tool – always show the client the best options (more expensive? maybe. maybe not) for their particular problems, and let them decide what’s too much money.
Ted Teuten
Interior Effects, Inc
Evanston, IL
+++++
I tend to agree with Phil Norman’s comments, although sometimes I find that clients are willing to stretch a bit. I always ask clients for visuals of things they like as a starting point. Sometimes what they show me becomes inconsistent with what they really want, and they are willing to stretch their budget, if they can - to have pieces that they will love and enjoy for many years, versus get rid of in a few years. I think making a realistic cost estimate is most helpful for designer and clients.
Thanks,
Judith Angel
Judith Angel Interior Design
New York, NY
+++++
Fred,
Phil Norman is spot on! As a commercial interior design firm, we would be remiss if we didn’t ask about a client’s budget going in. I can understand in residential work how a prospective client may not have a handle on what things cost or what they can truly afford and of course, there is always that suspicion that the designer is looking to spend up the budget. But in our field, senior housing design, clients often have specific capital expenditures planned out over several years or exact FF& E budgets dictated by financing arrangements and we better be able to meet their expectations or we won’t be doing work for them again.
Always enjoy your blogs!
Diane E. Harvey, CID
Evans Harvey + Associates, Inc.
Irvine, CA
+++++
I ask my client at the beginning of a project, “Do you have a budget?” There follows a lot of illuminating discussion. Many times I get a vague answer. This is not bad. It just means they “know it’s gonna cost money”, but they “don’t know how much”, and they “don’t know how much it’s gonna be worth to them.” Being aware of this, I help them explore what it is they are trying to achieve (what’s behind the change/expansion/purchase), and then I offer to help them to clarify/define that “thing they are trying to achieve” with my initial design services. And I say that if they need to, I can “help them put dollar amounts” to that. In other words, I would help them acquire a “price range” from high-to-low/from necessity-to-everything-I-want. I tell them at that first meeting that I can figure up an estimate of my hours that it would take for me to get them that: both the “clarification/definition” and the “price range”. Then they can decide up front “whether it’s worth it to them” to pay me for that service. That way we avoid the fear of ”the meter running” forever, without them getting what they want accomplished.
By taking this question/answer step by step, I avoid rushing in to establishing a “budget” which may not be the best method of proceeding. Some clients answer that first question, “Well, I know I have X amount of dollars, but I also have some other things I need to buy.” Those clients probably need some type of budgeting process. But if they say, “You know, I’ve got plenty of money, and I’m not worried about that. I just want to take it step by step and not spend it all at once.” Those are your best “hourly fee” candidates. Then what I tell them, in order to avoid the “meter’s running syndrome”, is that “we can proceed step by step, on an hourly basis, and what we will do is establish at every meeting what it is you would like me to explore for you. And I will do just that, and come back to you and report. Then based on that meeting, if you feel like you’d like to proceed, then we will establish what I will do again, and then I will do just that.” In other words, I tell the client I will “only charge hourly for what you specifically ask me to do.” I document in detail what we agreed/went over at the meetings, and what I did between the meetings, and my hours for each part. And I put that in my invoices. That way they have a concrete thing (description of my services which match up with the things we did together/talked about) for them to compare to my hourly fee. Very quickly, and over time, they can figure out whether that fee they’re paying me is ”worth it to them”.
Being a designer, I always end up doing more that what we agreed to. I see something along the way that might tie in from another angle, and it reminds me of something that they probably already need too. (Maybe they asked me for help with drapes, but now I see a great “table solution” that helps them get the furniture centered under the windows better.) I NEVER charge them for my time pulling together ideas/inspirations that they did not request of me. That is MARKETING. Even if I “work on it” before the meeting, and they buy into it, I STILL DON’T CHARGE for it. That way I retain their “trust” that I am really only charging my time for what I “told them” I would charge for.
Great topic!
Marcelle
–
marcelle guilbeau
interior designer
Nashville, TN
+++++
Hi:
ABSOLUTELY AGREE — ASK FOR BUDGET! I agreed w/everything that Phil said.
And, I think it is even more relevant in these recovering recession times. I only wish I had the 200K or 300k kitchen remodels as I did before this recession. I now find my clients MORE price conscious than ever before. My clients are shopping like never before. I am working 4 times the hours that I used to work for a lot less return. I regrettably find my current clients are price driven, where it used to be their projects were design driven.
Thank you for asking about my view.
Kathleen Beres
Kathleen Beres Interiors
Santa Fe, NM
