Interior Design Billing Practices

In order to effectively communicate your interior design fees to clients, you must be familiar with the various billing practices available. The key to successful interior design billing is choosing a method that suits the specific needs of your firm and project.
Flat Fees

Perhaps the most common interior design fee structure, a flat rate means that you charge a fixed amount for the entire project. It’s usually based on an hourly rate but can be calculated by a number of other factors, such as experience and square footage. The scope of the project and the exact fee should be outlined in your contract. Read this article to the end, to learn more about bookkeeping process for interior designers.

It’s important to note that some firms include heavily padded hours for admin and project management time with their flat fees, so be sure to ask about this in your contract before you commit to using this method of charging.
Combination Pricing

A combination of different interior design billing methods is another popular option for designers. It’s a great way to make it easier for your clients to understand what they’re paying for, while also providing you with more flexibility in the design process.

This can be a great way to price your services for large residential projects that take several years to complete. It’s a little more complicated than the other options, but it can be effective and help you create consistency in your pricing across all parts of your design process.
Cost Plus

In this interior design billing method, you outline the net value of the materials, products and furnishings as well as any subcontractors, then add an agreed-upon percentage to that total cost for a profit. It’s a great way to communicate your fees to clients, and it also carries a significant administrative burden since you must keep the invoicing organized.
Compensating for Designer’s Time

Most small firms and independent designers follow the hourly fee model, where they bill the client for their consultation and design time. They may also include charges on an invoice for the procurement of raw materials, material and furniture purchases and coordination fees.

Many designers also incorporate additional charges for travel time and other special rates. Be sure to check out the terms of your contract when signing on with a designer to see what you can expect to pay for these extra fees.
Cash and Accrual Accounts

Interior design is a highly complex business that requires expertise in both financial and accounting. Therefore, it’s often best to outsource your bookkeeping to an accounting professional who can help you determine the ideal interior design billing practice for your firm.
Building Trust

Regardless of how you bill your clients, it’s essential that they have a high level of confidence in your work and the value that you provide them. The more a client can trust you, the less likely they are to renege on a contract or make changes that could affect your work in the future.  Read to the end to learn more about accounting best practices for interior design.

Having a set interior design billing practice that works for your firm and projects is the best way to ensure that you’re making a profit and that cash flows freely into your business. In addition, it helps you to streamline your accounting processes and free up more cash for your other business needs.

Check out this link https://en.wikipedia.org/wiki/Interior_design for a more and better understanding of this topic.