The ability to project profit is the key to success. It may not be easy in the beginning but everything you are working toward should include this goal. This month, we share insights from coaching clients about where they began, where they are today and future plans.
These designers run different businesses but they share a commitment to succeed and a passion to learn. We need to keep up that capacity to learn as our culture and market changes often and quickly. The coaching market is saturated with people wanting to help others. The key is to find the right person with the right background, who can help you achieve your goals. Find someone who can be actionable and help you move the needle.
Collected Living Design, MO
I started my business as a solopreneur out of my house in 2019. After a year, I had the opportunity to bring on another designer as a partner, and we continued to work from my sofa and store client product in my basement. At that time, we were charging flat fees but pulling numbers from a hat. We had no idea how much we needed to charge to actually be able to pay ourselves anything. We were charging $500 to $800 a room for design fees, and the clients would spend $10,000 to $18,000 on a room. Yikes.
Sasha Marie Interiors, NY
I started my business in February 2020 but didn’t start taking clients until August 2020 as I really wanted to speak with a business coach first and get a better understanding of how to achieve my goal of replacing my $70k income. I am a planner!
In a very short amount of time I was able to replace my income, quit my full-time job and take a chance on myself. I could not have confidently done this without knowing I had a business partner with Cheryl’s experience in my corner. For 2021/2022, together, we set a goal for the business to bring in $100,000 and hire someone to assist me. The most I had ever felt confident enough to charge prior to this was $2,500.
Christi Holcombe Interiors
I worked out of a studio above my garage until we opened our shop in May of 2020. I charged randomly with no set way or specific processes and every project was inconsistently priced and it was much harder to qualify clients because we had no framework. We would have large projects here and there, but they were not steady and the smaller projects filled in. I was charging $150/hour with only a 30 percent markup on goods. We went down to two people right as the pandemic began. Prior to that we never had more than three people.
Blooming Daisy Interior Design, AZ
In Spring 2017, after redoing my fireplace, I created a cozy space just for me. As a single mom, I needed this. It was the beginning of me thinking I wanted to do this for other people and build a business so my time was more flexible. Little did I know flexible would mean working all hours of the day! With a 45-minute commute to work, my car became a Design/Business University listening to podcasts. I began with $100 consults then went to $297. My average design fee was $3,000.
Shandy: We now charge around $2,000 in design fees for a room, and most of the time we’re doing multiple rooms for a client. Our clients are now spending on average $25,000 on a space, depending on the room. We also do design for custom new builds and use Cheryl’s averaging model to come up with design fees for those projects. Depending on the size of the house, fees for those projects start at $25,000. We went from under $100k of revenue our first year to $270k to $600k, and now expect to more than double that in 2022.
We now have a studio with two furnished rooms that allows our clients to see our aesthetic and experience our favorite furniture lines. In the third room, we work on designs with our team, which has also grown. We currently have an ordering specialist and a project manager, and eight months ago brought on two additional partners, another designer and a general contractor and we have an on-staff carpenter.
Sasha: Since working with Cheryl, the business has now brought in more than $400,000. Not only was I able to replace my income, I was able to gain back time with my special-needs son.
We currently have nine active projects (furnishing and construction) and each one has a flat design fee and a minimum expenditure so I am able to project my income and hire for growth. We hired a project manager, design intern and an in-house handyman. Our fees average at $10,000 with some higher and a few lower but always with a minimum expenditure based on the client’s needs. Another perk to working with Cheryl as my coach has been her trade program. It is a safe place for me to buy products as I know she is not going anywhere!
Cristi: The idea to start the shop CH Home came about after my husband got laid off and could help me get it started. Then the pandemic hit and we thought we would lose our life savings. But we persevered and kept forging on and coaching helped me stay sane during this time. Now we charge a flat fee with a minimum expenditure 90 percent of the time and being able to project our income has fueled our growth. Our average fee is up to $25,000 with a minimum expenditure of $45,000. On average we have 35 to 40 projects going at one time. We have grown to 12 employees and we moved into a 3,500-square-foot office in October, 2021.
Wendy: I love design and putting together a beautiful space is a lot of fun and seeing our clients overwhelmed with emotion is the best feeling. But when I see my business grow and how that affects my employees and subs and contractors, that’s where I really start to have fun! We are charging higher fees; our average is now $18,000 and higher minimum expenditures than I ever thought possible. Our initial consult fee is now $347, and Cheryl has sold me on charging hourly for project management too. I have two employees currently and am learning the art of delegation!
Shandy: I have a long list of things we would like to do, including a store front, a book and adding real estate to our business. I’m building an empire, and Cheryl taught me how to actually be profitable doing it.
Sasha: We just sent a proposal out for design fee $28,500 and minimum expenditure $100,000, and are actively looking for a drafter to add to the team. I confidently signed a car lease and a mortgage based on my success in projecting my profits.
Cristi: I would love to open a second shop or launch into product design next. And we are bursting at the seams after less than a year in the new location!
Wendy: We are looking to move into an office and have a small showroom and expand our workroom. I want to double my income within two years and hire two seamstresses — we now have our own workroom — a draftsman and another general assistant. I have big plans!
Projecting Profit and Coaching Takeaways
Shandy: Being able to project our income and resulting profit has changed everything. It began with understanding the income we needed to run our business. Until I shifted my mindset to understand what the design fees needed to cover, I didn’t charge appropriately. We worked with Cheryl both in one-on-one coaching and her group coaching program, and quickly realized that we were not charging enough to cover our operating expenses and pay ourselves. She helped us understand how to calculate our profit margin, account for all expenses for the year, and work backwards to know how many clients we needed to have and how much we needed to charge for that work to make the profit we needed.
Sasha: The hardest thing was when my husband lost his $250,000 salary position. If I had not been following the flat fees and minimum expenditure business model, I would have had no idea what income I would bring in during a scary time for my family.
The only way to succeed with any coach is to lay everything out with complete transparency. You have to be honest in what you do and be open to learning. Cheryl rearranges the way you think about your business and emphasizes repeatedly there are ups and downs and new challenges at every level of growth you achieve. She insists you put the work in! I feel like I have someone who “gets me” and this gives me great confidence to push myself harder.
Cristi: The biggest takeaway is that you can’t scale up in any capacity without knowing your numbers. If you can’t project revenue and profit, you can’t know when to hire, order inventory or even take a vacation. Without the coaching I received from Cheryl, I would have probably run my shop and company into the ground. I am serious about that. I am grateful I met her in the Small Business Think Big Facebook group!
Wendy: I have worked with a couple of coaches and have learned something from all of them. Having a dedicated business coach has been the best investment I made in my business, myself and my sanity! It all starts with the mindset that you are a business with the goal to make money. Cheryl taught me how to make my business model a win/win for me and my client. It was a complete game changer to my business and helped me know my projected profits, which is vital to a growing firm. She layers concepts to ensure you are looking at all parts of your business to run a tight ship. We have to always be evolving and stretching ourselves to get to that next level. Some days are hard but I love owning a business.