Six Ways to Price Your Services as an Interior Designer
Updated April 2023
When determining how to price your interior design services, it’s important to understand the various pricing structures out there. On top of that, there are many factors to consider when determining how to price your services like location, marketing, experience level, retail vs. trade sourcing, scope, client experience, team, and so on. If you want an even more in depth look at the pros and cons of each of these billing methods, be sure to download The Complete Guide to Pricing Your Interior Design Services.
While every designer I’ve worked with over the last five years prices a little bit differently, I’ve definitely seen consistent ranges among the most popular methods, as well as what I believe to be the pros and cons of each. I go into even more depth in my Pricing & Proposals Workshop here.
*As a side note: my expertise lies in residential interior design businesses, not commercial, so keep that in mind as you read this post if you’re a commercial designer.
Six pricing structures for interior designers
Hourly
Flat fee
Price per square foot
Percentage of project
Commission only
Hybrid
Hourly billing method for interior designers
Hourly is one of the most common ways to bill for design services and it’s probably the one I would recommend if you are just starting out AND if you are actually going to track your hours. That’s the key: if you aren’t going to track your hours, then you obviously should not bill hourly. I say this because YES, I’ve had designers who bill hourly who tell me they are terrible at tracking hours and definitely underbill. If that’s you, then absolutely move over to flat fee!
I have hourly designers do it one of two ways:
they provide a detailed scope and an estimate of hours, letting clients know upfront what they can expect to pay for their scope, or
they simply provide their hourly rate, provide a general scope, and then start.
This means that everything is billed at the hourly rate, whether you have just one rate for all work on a client project, or if you have various rates based on the type of work being done (this would be the case if you have a junior or an admin working at a lower hourly rate).
Flat fee billing method for interior designers
Flat fee is the other most common way we see interior designers bill for design services and it’s the one I would recommend if you have data on how long a typical project actually takes you. If you’re just starting out and have no idea how long each phase takes, you might be taking a stab in the dark to price your services and then grossly undercharge.
Here’s the thing: even if you’re a flat fee designer, you (and your team) should still track your time on a client basis so you can review data and your pricing to make sure you are billing appropriately.
The other key “YOU-MUST-DO-THIS” “DO-NOT-NOT-DO-THIS” tip is that your scope of work must be very clearly defined. What you will and won’t do, what’s included, all that. (PS–our Sample Scope and Service Agreement Template for Interior Designers has the best scope I’ve ever seen, and I’ve seen HUNDREDS!! Check it out here.)
If you do flat fee billing, you’ll provide a flat fee upfront to the client for the entire scope of work, and then you’ll take that fee in installments throughout the process.
Price per square foot billing method for interior designers
Charging your interior design fees based on price per square is not quite as common (although we do see it with our designers who do new construction projects and large-scale renovations, and our designers who do commercial design).
This method is probably the easiest to prepare a proposal for because you simply calculate the square footage of the room being designed and then multiply that by your price per square foot.
The price per square foot varies GREATLY by location, experience, and the level of service you’re providing.
When billing this method, you’ll bill it similarly to flat fee in that you’ll create a scope of work (it should be detailed!), calculate the fee, then collect the fee over 2-3 installments.
Percentage-based billing method for interior designers
We actually don’t have many designers who do this, unless they purely do new construction or are general contractors or architects, as well as designers. In this method, you would charge a % on top of the total construction costs and/or total furnishing costs, and that would serve as your design fee.
Commission/mark-up only pricing method for interior designers
I don’t have many designers who bill this way (so if you do, I’d love to chat!!) but in this method, you charge only the markup or commission on products and no design fee. When a client purchases items through you, your markup on the product is your payment.
Hybrid pricing billing model for interior designers
Charging design fees on a hybrid model means you combine 2 or more of the above methods for your billing. So rather than just doing a straight hourly or straight flat fee across the board, you have a billing method for design phase, a billing method for administration and management, and a billing method for install.
We are seeing (and recommending that) many designers move to a hybrid model so they aren’t upside down on their projects if there are delays.
My two favorite hybrid methods:
Flat fee for design, then hourly for everything after that (revisions, management, install).
PPSF for design, then hourly or retainer for everything after that.
When pricing your interior design services, don’t forget to do these things:
Track your hours ALWAYS (even if you’re flat fee or PPSF)
Bill your hourly clients on the same day each month
Review the profitability of each project as part of your Offboarding Process in relation to the hours worked on it by you/your team and all other expenses. Need help with your processes? Check out this post.
Assess your data to see how long each project type takes you to design so you can let clients know a minimum starting price for working with you
Detail EVERYTHING that is included in the scope (for flat fee and PPSF designers)
Refer to it as “The fee” or “The rate” (not “my fee” or “my rate”) because even though, yes it is the fee you charge, it is not just YOUR fee. It is the fee to cover your overhead, your team, your experience, your business expenses, your continuing education, etc. Removing “MY” from the fee conversation helps to make it feel less personal and less tied to you as a person.
If you use the price per square foot (PPSF) method, ALWAYS cross-reference that number with your hourly rate to make sure it makes sense. Example: If you’re designing a 2,500 SF house and you bill $10/SF and your rate is $150/hour, the design fee for this full-service project would be $25,000. Divide that by your hourly rate and that breaks down to 166.6 hours total to design a 2,500 SF house. Is that realistic? We can take that one step further and say, we know it takes us ten months to complete a project this size. So at $25,000 total design fee and 10 months, that’s $2,500/month in design fees or 16 hours/month, 4 hours/week. Does that seem realistic for the hours you’ll work on the project? All of this is SO EASY to assess if you track your hours.
How to know when to increase pricing
Looking back on how your business has grown will help you determine if you need to increase your prices. If you've just taken on additional expenses (like hiring, getting an office space, investing in your business), you should adjust your pricing so it reflects the increase in your overhead. You should also be increasing your prices if you are closing on 100% of the projects that inquire. Be sure to check out this post for more tips on signs it’s time to raise your prices.
If you haven’t implemented the bullets from above into your business, you might find yourself working all the time and not making a profit. If this is the case, you should either increase your price, decrease your scope, shorten your delivery, hire out parts of the process, or be okay with the fact that you have a very expensive and stressful hobby.
There are actually many more ways to price your interior design services and the key is doing what works for you and what will allow you to be profitable and work efficiently.
An elevated client experience is critical for charging high-end fees
If pricing your services has you stressed because you’re questioning if your client experience process is in alignment with a higher fee, I would encourage you to check out my Client Experience Templates. You will find all the tools and resources you need to create a streamlined, professional, and luxurious client experience.
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