Comments on: Commissions

By: dawn

dawn — Tue, 07 Jun 2011 00:53:40 +0000

i can not agree more with vicente, i too wish there was a pricing standard, i have wished this for years because i think it is such a complex issue it confuses clients. i also agree with mona that charging just an hourly would leave the vast majority of designers in the ‘poor house’. it just would not be a viable option for me at all. i do charge hourly for creativity, planning, specs and drawings. then i give a small discount on retail. i have had clients ask for discounts very rarely on product only (usually a single spendy piece in the whole presentation) and depending on the client relationship i have given the discount, and they have purchased the piece instead of looking for something less expensive. honesty, integrity and clarity is required and clients generally understand.

great question!

By: Dave Glass

Dave Glass — Thu, 02 Jun 2011 03:09:50 +0000

In terms of design, it is an irreplaceable component that cannot be overlooked in business. The level of creativity and resources require to produce a design to a client is far more strenuous than imagined. Thus, commissions should not be compromised in anyway, due to the nature of the job: where no one else is able to perform and deliver at the same level.

By: Steve Hand

Steve Hand — Tue, 11 Jan 2011 08:02:58 +0000

Maybe these prices could be displayed in order for consumers to comprehend. I am not sure if this solves your problem with clients, but it may be the answer to relieve all the questions and problems you appear to be experiencing.

By: Brenda Be

Brenda Be — Fri, 09 Jul 2010 14:08:20 +0000

I believe in the concept of charging a design fee for design time, whether this is structured as an hourly rate, or some form of flat fee. I also believe that one not merely is justified in, but should be, charging a markup on product if providing product. I don’t like the term commission. A retail store does not charge commission, they charge markup. Here is how I handle it: I charge a design fee, always, for every project. The fee is non-negotiable but there are options of how to handle it, such as hourly, or project-based. I don’t like to use the term flat fee because it implies no matter what your decision-making or other style of client and no matter how much time you want, you will pay the same price. I have one type of project based fee for projects that involves a definined scope of work for a defined fee, with a defined amount of edits/reworks. After that, additional help is available hourly. I have another type of fee that is based on a percentage of a project budget, on the theory that projects with lower budgets are for a) clients who can afford less (in one way this is sliding scale) and conversely b) that projects with higher budgets are for clients who will want/need/demand more time. This is somewhat accurate, altho lower budgets can be more difficult but still that goes back to a). Still there is defined limit, it is defined as up to 30% more hours than you would get if paying hourly, and I keep loose track of hours and warn them if they approach the limit. This gives them the sense of essentially they are getting a discount with this method, which in essence is true, so I don’t get a lot of request for discount, just people pick which method they like and leave it at that. As for product, I put it this way. My design fee pays for the time it takes to design, layout, present (renderings, proposals, etc) and specify (product is specified by brand, model number, color, etc.). I use products that are both ‘to the trade’ and available otherwise. Then clients are free to source, shop, and obtain all products themselves. If they would like me to do this task, I am happy to do so, and they will simply be paying me retail on a product that is purchased by me wholesale. My language is essentially that as is standard in a retail situation, wholesale invoices are not provided, that I will strive to provide a fair market price, that my markup varies with the amount of my wholesale discount (and also with how difficult or time consuming it is to obtain the product, what the total price of the product is, and whether i am cutting Way back on my own fair markup just to get a better product that i want to see in the project to fit in the budget) and that my average markup is 10 to 40%. I really don’t get arguments with this, altho there are some products that clients want to get themselves, or have asked me if I would cut my markup on one particular product out of the whole of their design (altho annoyed, I said yes, because I sensed they wanted to win one and overall the project was big enough that this was fine). Most of my clients have me provide most of the product. I simply define this as paying for the time it takes to source, pick up, deal with, check quality, return, guarantee, etc etc, product, which is in reality a great deal of time, and it is a separate task from designing. In general, they will pay the same amount to me as if they bought it themselves, and then I will be the one dealing with all this stuff and I will guarantee the product personally for at least a year. Purchasing takes a great deal of time, this is why there are people in large businesses called ‘Purchasing Agents’ whose only job is to buy stuff. From any kind of ‘moral’ perspective a) it is moral to make money, we are in a business, if we wanted to be saving the world we would be social workers, and our clients want to make money for their time, skill, experience and intelligence for what they do for a living too, and b) it is not really all that moral to take a wholesale price, which we are specifically given by product suppliers for the purposes of making money, and pass it along as-is to our clients with no market, which effectively undercuts their retail prices (if they also sell retail, as many do) or undercuts the retail prices of their other vendors. This is not what they intend by giving us ‘designer discounts’ which are not discounts, they are wholesale pricing. The key to this system I have found is by making clients free to buy product through you or not, and even being willing to substitute other products in their design if they want. It does *not* mean telling them where to source products, if you go to Macy’s they will not tell you where else you can buy the stuff they sell, and that is not my job either. I can’t tell clients where to source most products anyway since I mostly get them wholesale. At any rate if they are paying me a fair price for my design, and if my markup is about equal to what they would pay at retail if they dealt with the shopping themselves, then we should both be happy.

By: David vanLing

David vanLing — Wed, 07 Jul 2010 00:34:10 +0000

As much as I would love to just design for a flat fee and be done with the project. I have to constantly educate myself on what is new, exciting and comfortable for the client to live with. I do not think a client would like the idea i sold them a plan and a file of objects to them to guess if it is comfortable or if it has a long back order date and needs to be reselected. The disclosed, cost/plus is important in the hours it takes in the design process. Would someone disclose what a flat fee for an average project would be and how are you compensated for holding the clients hand through the process of creating a home from beginning to end.

By: Susan Hargraves

Susan Hargraves — Tue, 06 Jul 2010 15:09:12 +0000

Try as we might to nail this down once and for all – with thoughtful, creative, considered suggestions – the discussion continues. My observation? It’s just NOT going away. Even when we convince each other, our clients react. We’re not done with this yet.

By: Commissions and Charges | Vicente Wolf Blog

Commissions and Charges | Vicente Wolf Blog — Tue, 06 Jul 2010 12:09:17 +0000

[...] This post on commissions elicited a big response on the blog. Here’s one that really got me thinking… [...]

By: Carleen LeVander

Carleen LeVander — Thu, 25 Mar 2010 15:30:17 +0000

I think Commission is great because it is atransparent wa to work with a client and that builds trust.

By: Vicki

Vicki — Wed, 24 Mar 2010 14:09:47 +0000

We love what we do but its a business. This is how we make a living.
If I were to discount something for a client I feel I would be cheating all my other clients.

By: Jodie

Jodie — Wed, 24 Mar 2010 04:26:57 +0000

I am often asked to write letters, complete forms, write reports for purposes other than the job clients are paying me for, to do counseling with them. I am amazed that people expect me to do this for nothing and can even be offended at times that I charge for that. I am very clear with my hourly rate for this type of work. I tell my clients if I could be at home walking my golden retriever down the sidewalk, but I am here typing up a letter for you, you are going to have to pay me. I do not negotiate any discount whatsoever and tell them my financial policies within the first five minutes of their first session. I have to be firm and I am. I send a message that they need me, I do not need them. It’s their choice. They came to me.
Also, I think that the earlier comment that self made business people are more understanding of commissions vs. stay at home folks not being as willing to pay commissions because they aren’t hard workers is inaccurate. My experience is that people who stay at home are generally not generating the income as those who are out working. They clip coupons aka ask for a discount out of necessity!