Design Parameters

By Anne Marie Soto

Working with an interior designer to transform your house into a home that suits your needs, tastes and lifestyle is an exciting, creative process. But your relationship with your interior designer is also a business relationship. And, like any good business relationship, the financial arrangements are key to successful results.

The process begins by finding an interior designer whose work and experience is compatible with your needs.  In New Jersey, one of the easiest and best places to begin looking is on the Web at  www.njasid.org/findadesigner. You can search for a designer by name, town or county or by viewing Portfolio Pages, arranged by specialty, that contain information about the designer, as well as photographs of his or her work. Personal recommendations from neighbors, friends and colleagues can also be a valuable place to begin your quest.

Once you have narrowed your search to several possibilities, you will want to interview the designers. An important part of that interview is a discussion of how the designer charges for services. Designers, like other professionals, are different from one another in their combinations of talents, skills, knowledge, experience, personalities, specialties and reputations. Consequently, what they charge for and how they arrange the fee structure can also vary.

The Fee Structure

There is no such thing as a “typical” fee for an interior designer. Many factors influence what and how a designer may charge for his or her services. These factors include the reputation and experience of the designer, the scope of the project, the time frame for completion, and more. Most residential interior designers use one of the following methods, or a combination of these methods, to set their fees.

Fixed fee (or flat fee): The designer specifies a fixed sum to cover costs, exclusive of reimbursement for expenses. One total fee applies to the complete range of services, from conceptual development through layouts, specifications and final installation. This fee is usually paid in installments, beginning with the signing of the contract. Often, the fee is for design services only. If this is the case, additional services, such as shopping with the client, may be billed on an hourly basis, reflecting the designer’s time.

Hourly fee: Compensation is based on actual time spent by the designer on a project or specific service.

Cost plus: The designer purchases materials, furnishings and services (e.g., carpentry, drapery workrooms, picture framing, furniture, etc.) at cost and sells to the client at the designer’s cost plus a specified percentage agreed upon with the client. This percentage compensates the designer for time and effort.

Square-foot or percentage of construction costs: Interior designers may base their fees on the number of square feet or total building costs of the project. This method generally applies to new construction or extensive renovations.

Depending on your project, the interior designer may combine fee structures for different types of services. For example, if the designer is heavily involved in the blueprint and construction phase, he/she may charge a per-square-foot fee or an hourly fee for that part of the project. Then, when you are ready to decorate and furnish the interiors, cost plus may be the most comfortable method for both of you.

At one time, cost plus was the most widely used fee structure for residential designers. However, it is now becoming more common for designers to charge an hourly rate for design services and cost plus for products and services the designer is asked to purchase. This can be a good option for the client who loves the shopping phase of a project. Before a project begins, the designer and the client should have a frank discussion about the financial expectations so that they can negotiate the methods to suit a client’s particular needs.

In addition to these fee structures, the designer may require a retainer before beginning a project. A retainer is an amount of money paid by the client to the designer and applied to the balance due at the termination of the project. The retainer is customarily paid upon signing the contractual agreement in advance of design services.

Discuss Your Budget 

The designer’s fee is only one part of the budget … and only you can decide what a reasonable budget for your project is. If you have concerns, discuss them with the designer. And don’t be shy about asking the designer to help you optimize your budget. Working together, you may find alternative, less expensive ways to achieve your goals or develop a plan for doing the work in stages. Understand, too, that antiques, custom-made furniture, and modifications that involve altering or moving load-bearing walls or beams can have a significant impact on the cost of a project. And things like requesting changes in mid-project or making excessive demands on the designer’s time can escalate your costs. The more research and planning you do before you start, the more you will be able to keep costs down during the project.

Request a Cost Estimate

Before you sign any agreements or make any payments, ask the designers you are most inclined to work with to provide a cost estimate in writing. This is not a contract and is not binding on you or the designer.

The cost estimate should specify the scope of work and the type of fee structure the designer uses. If the designer charges extra for other services — such as reviewing plans or attending meetings with an architect or contractor — these should be listed as well, both by type and rate. Be aware that the designer is not responsible for the costs of other professional services, such as painting, carpet and tile installation,

If you have any concerns, get bids or estimates from more than one designer. This way, you can compare fees, costs and other expenses. It will take a bit more time but, in the end, you will probably be more comfortable about the scope of your budget.  

Finalize the Agreement

Once you have selected a designer, ask him or her to provide you with a letter of agreement or contract for the project. Do not make any oral agreements, pay the designer any money, or authorize any work to be done on the project, including giving the designer permission to begin looking for furnishings or researching styles or patterns, until you have an agreement endorsed by both parties. 

Communicate and Maintain Records

Communication is a key ingredient in the successful outcome of your project. Discussions about the fee structure and the cost estimate will give you important insights into how well you and a particular designer communicate. Once your project is under way, good communication will make it easier for the designer to successfully meet your needs and expectations. Never hesitate to ask questions about any aspect of the project. Keep notes of your discussions with the designer and confirm any and all instructions, decisions or changes before they are made. If you agree to make changes to the contract, always make sure to put them in writing and have them signed and dated by both parties. Maintain a folder with copies of all plans and contracts, receipts, invoices and other documents.