What to do when a client asks you to share your interior design trade discount?

Updated March 2023

Designer submitted Question

“Will you share your discount?”

This week’s Dear Dakota question is one I know you have dealt with before. You’re on a discovery call with a potential client and they ask the dreaded question that makes your skin crawl.

This one gets me pretty heated (it’s NOT a discount, it’s your trade pricing) and in this post, I’m going to share a few ways to respond PLUS my thoughts on why you should never ever (or, “never sever” as my daughter says) share your “discount” with clients.

01 | First let’s assess, WHY are your prospective clients and clients asking this question?

Are you marketing yourself as a discount designer? Are you only showing images of you shopping at retail or discount stores? Is your body of work or marketing attracting clients who can’t afford trade items OR people who simply do not want to pay for them? If you’re like NO NO NO then I want you to know your client is likely asking this because they’ve heard other people do this, NOT because they expect you to do it. So this doesn’t make them a red flag client, this just means they need clarity into your process and your business model.

Don’t market your discount. Market your value!

02 | It costs you and your business time (which is a higher value than money) to have these accounts. And also money.

This is the professional trade-only pricing that you applied for, qualified for, and maintain because you are a business and have met (and continue to meet) certain requirements. There is a cost for you to have this account. You’ve invested time researching vendors, going to market, meeting with vendors in your office, shopping for new release items/fabrics, and so on.

You’ve invested money in placing opening qualifying orders (and maybe carried inventory AND kept is safe in the hopes to sell it to an upcoming client). You’ve placed orders to maintain your annual spending requirements. You might even pay for books and samples.

For your business to have access to these accounts, there is a time and monetary investment. Not to mention, having and using the same vendors means you have a better relationship, better pricing, better customer service, and quicker sourcing because you are familiar with the line, the fabrics, the team, etc. That’s a real savings to your client especially if you bill hourly for sourcing.

03 | You need to know how you actually DO price your products.

People are going to ask, and they’re not the bad guy for doing it.

Think about how you want to price your products.

For most of our designers, we help them communicate that their products are priced to be competitive with retail and that their price includes their company handling the order placement, tracking, issues, delivery coordination, and continued updates.

I personally do not recommend SPLITTING the “discount” with clients or giving a XX% discount. For real.

What does this even mean?

The discount between what?

MSRP and your price? MAP and your price? RETAIL and your price?

A discount off of what?

MSRP, MAP, RETAIL (what retailer?).

See how this opens up a ton of backend admin work?

Do you have time to be checking that on every single product? I know my million dollar design firms don’t.

This sounds like a logistical nightmare and then what happens if you “split the discount” and then the client (who now thinks this is some sort of competitive price hunting bargain game) finds a retailer who offers it for less than the retailer you found to establish the “split”…are you reducing more? Are you crediting them back?

If it's something you cannot get for less than retail (maybe because One Kings Lane, Serena, or Perigold have more buying power and therefore lower pricing and their own freight lines) then you can always let your client know that you will provide them the purchasing information if you can't beat retail pricing (if this is something you would do, however, please know, many of our designers don’t do this). I do find that this does instill trust in the client if you let them know you do this. That is something to consider.

04 | If you discount your products, will you also discount your scope of work related to ordering and product management?

LOL.

But think about it.

Most of our designers use the product markup to cover their time spent in ordering, tracking, communicating with vendors, pricing, updating clients, handling claims, coordinating deliveries, receiving small items and inspecting them at your office, etc. If the client is wanting a discount, let them know your pricing covers your time to do all of the above.

If they would prefer you not include those services in the product price, would they prefer you bill your hourly rate of $175/hour for all work done related to ordering and product management instead?

I would guess it would be a solid NO.

05 | Does your vendor agreement allow you to give your pricing directly to clients?

Most vendors have requirements for pricing and I would guess you don’t want to risk your relationship so a client can save $1,000.

And then, how do you feel telling your vendors you share your trade pricing with clients? Would you call it your “trade discount” when talking with your vendor? Or would you call it your “trade pricing”? Yes, maybe a play on words, but please be clear that this is not a discount, it’s your pricing.

06 | Think about your industry as a whole when you give your discounts. Are YOU the problem? (EEK)

They say “community over competition” yet when you pass your to-the-trade professional pricing to clients, I would say you’re not actually considering the community.

There. I said it.

Pricing your services and products appropriately is integral to the design industry. If you underprice your services and give away your professional trade pricing, your clients will undervalue your work and you’ll lower the standard for what designers in your area can charge if you continue to give discounts and market that to clients. (Now, of course, there are some clients who PREFER to pay top dollar knowing they’re working with a high-end non-discount firm–and that comes with solid marketing, an elevated client experience, and an efficient process).

07 | Think about your future projects. How long do you want to be doing this math?

If you start off discounting your products and then realize the amount of work, headache, accounting logistics, and challenges that come along with it, you’ll soon understand why many designers DO NOT discount their products below retail. It requires WORK.

But, then you’ll get referrals from clients who worked with you when you DID discount your products. And these new prospects will want that discount. And they’ll be upset when you don’t offer it. And then you’re STILL having the conversation and feeling wobbly and guilty for charging for your services and the products (which just an FYI is how businesses work. Services are one revenue stream. Products are another revenue stream. Like when you get your car fixed, you pay for the mechanic to fix the problem as well as the parts used to fix the problem).

Like I always say, “Start as you mean to go on.”⁠

HOW TO SHARE YOUR PRICING POLICY WITH YOUR PROSPECTS⁠ + CLIENTS

01 | Determine what you WANT to do. ⁠

Do you want to price competitively with retail? ⁠Do you want to do a set markup on everything regardless of your pricing structure with vendor? ⁠Do you want to sell products at a low price and bill hourly for all work beyond the design presentation? Do you want to base your markup on the specific vendor (example: Visual Comfort is XX%, Gabby is XX%, and Rowe is XX%)?

02 | Set the expectations up front and educate your people on how you price.

You can do this by sharing your pricing policy on an FAQ page on your website, in your investment guide, and in your welcome guide. ⁠Be sure your policies around pricing and who buys products presented in the design are in your interior design contract (obvi!).

03 | How to tell someone you don’t share your “discount”.

Explain to them all of the above, and detail your policy on how you price your products and why that’s a benefit to them. If you set everything up properly from the start, you shouldn't have to deal with this except for on inquiry calls. And then when the question does come up, you can confidently answer.⁠

The reason I get so heated about this is because I know how much work, dedication, and talent it takes to run a design firm that offers design services, project management services, and also sells custom products. The last thing you need is more backend admin work so ask yourself: HOW CAN YOU MAKE THIS EASY? For more on why it’s risky to sell retail, click here.

Price your items to be competitive with retail, when possible, and take excellent care of your customers during the ordering process (click here for a tech tip on organizing your ordering process). Then on install day, they will have a totally unique and interesting and amazing design, just like the ones they fell in love with in your portfolio. Everyone wins!