This article that I have chosen is a 43 page article. I have written this current even on the first 15 pages of the article since it is practically a small novel. I have found that this article, produced by ASID, is a very helpful tool for finding success in today's economy. It is full of many pointers and lessons that can be used throughout the design business.
"Interior Design in the New Economy--Lessons Learned from the Great Recession"
The 2008-2009 recession brought the building and design industry to a stand still. Jobs were lost, spending was down, and consumer habits drastically changed for the worse for the industry. Lifestyles quickly went from lavish and excessive to minimal with a “less is more” attitude, all the while being a totally acceptable perspective. This outlook took a large toll on designers as they found themselves with fewer and fewer projects. Clients found that they could demand much lower prices from their designers as most were eager for the job and competition amongst them was high. Many designers found that, like their clients, they too could get by with less. This lead them to cut overhead costs, and find ways to run their business as effectively as possible. Some even redefined their role in the business to better advance themselves in the market of this “new economy”.
This report was written by ASID professional members who are seeking to help others in the interior design industry in the future of the design industry. These professionals got together and shared with each other their own experiences from their personal highs and lows of the business. They have broken down their advice as follows:
“Think Lean, Mean, and Green”
While the economy was flourishing members of the industry were focused on bringing in jobs and money at a regular pace. During this time, this is where their time and energy was solely used. All the while, no time was spent finding ways to reduce business costs and run the firms most effectively. These professionals agreed, that if they were to start up a new business today, they would start small and conservative.
“Right-Size and Retool for Today’s Cost-Conscious Market”
- Reduce Overhead
o The ASID professionals came up with a list of recommended changes they could make to their business in order to reduce overhead costs. The common denominator amongst their recommendations is to analyze what you have, what you use, and where you can cut back. Do you really need to be paying rent for a larger space filled with a sample library? Can you use the internet for these instead? How often do you use your conference room? Do offices really need to be as big as they are? Bottom line: scale back! With both Jane and Linda working out of their respective home offices, they are able to reduce the overhead costs of rent. Meetings are held in their dining rooms (although still very professional) or on site. This cuts down on all sorts of costs including rent, travel time and money to/from work, utilities, and maintenance.
- Go Green
o Find ways to operate your business on a total green level. Promoting sustainability to your clients is one thing, but if you can model your own business in the same way it can lead (no pun intended) to better business.
- Be more strategic about choice of projects/clients
o Here they introduce a interesting concept deemed the “80/20 Rule”. This states that 80% of your revenue should come from 20% of your clients. This encourages businesses to focus in on their most profitable clients, and maintain a relationship with them over time. They also recommend that you invest time early in getting to know the client so that you can fully assess and determine whether or not the client/project will help to better your company—not all clients do! Additionally, these ASID professionals stress the importance of billing appropriately. I have seen this a lot recently with Studio Entourage, and both Jane and Linda agree. It is so important to put good time into your estimate and proposals so that clients have a general idea of what they will be spending. What’s equally important is that they recognize that what you are providing them is an estimate. In addition to this, Jane and Linda, have been stressing with everyone (including themselves) the importance of keeping track of where your time is spent. Any time that can be billed out to the clients, rather than spent as overhead, should be carefully noted. They have found that this is particularly challenging when they are out on the run and they are constantly fielding phone calls, or when they are having to take time away from the design aspect of their project to answer email after email. Recently, they have found that they have to tell some of their clients, that their time is better spent if they can work through preliminary phases of a project uninterrupted and then follow up with a meeting or phone conference.
- Offer Expertise, Not Just Experience
o This is a big one for me, especially as a young designer who is still in school. When it comes to getting a job, how can I compete with designers who have been active in the industry for years? These professionals suggest that you show the client that you have a thorough understanding of their specific needs and propose ways to address these needs accordingly. Many designers rely on their portfolio to get them the job, but if you can hone in on the client and find the most effective ways to meet their needs you will stand out from rest.
ASID. "Interior Design in the New Economy." Asid.org. American Society of Interior Designers, 2010. Web. 27 June 2011. <http://www.asid.org/NR/rdonlyres/E24FD5C1-27B6-4077-A1B5-0E9F39483A4B/0/DesigningInTheNewEconomy_FINAL.pdf>.
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