5 Podcast Episodes About Managing Your Interior Design Firm’s Finances

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This module is our “Profit” module in the DesignDash Growth Studio, so in February, we’ll discuss financial reporting, P & L’s, margins and mark ups, and so much more. In honor of our Community’s deep work on this topic over the next month, we’re providing readers with a list of 5 DesignDash Podcast episodes about managing your interior design firm’s finances. This is a frequent flier topic on the podcast because so many owners struggle to record, interpret, and improve their firms’ profit. Think your firm’s profit is the only indicator of achievement and longevity? Think again, and check out our recent Q&A, “What Does a “Successful” Firm Look Like Beyond Revenue?,” to learn more from Laura and Melissa.

5 Podcast Episodes About Managing Your Interior Design Firm’s Finances

Episode 63: How Designers Can Stop Losing Money with Laurie Laizure

Listen to this podcast if… you’re busy, your projects look “successful,” and you still feel like you’re not keeping enough of what you earn.

This episode is basically a close look at how design firms lose money in normal, everyday ways. Not fraud. Not catastrophic mistakes. It’s the little choices that feel professional in the moment but are actually quite expensive later. A vendor problem comes up and you cover it. A product is discontinued and you scramble to find a replacement. You spend hours troubleshooting and decide it would be weird to bill for it. Laurie’s point is that these decisions stack up, and they can erase your profit margin if you’re not careful.

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One perfect example is when Laurie brings up designers paying for problems that belong to the client. She’s seen it constantly in her community, and she’s not polite about it because it’s not a small issue. If the product is going into the client’s house, the client pays for it. You can manage the situation, but you do not need to subsidize it. As she puts it:

“A firm owner will say, ‘Oh, we’re just going to eat that cost,’ but don’t eat that cost. Yeah, don’t eat that cost. How about no? Because honestly, the client, if you were not there, what would be happening? The client would be dealing with it. You know what I mean? They would be dealing with the issue. You’re there to make sure you’re dealing with the issue, but that doesn’t mean that you have to always take the burden of the cost of anything that goes wrong in and any issue that comes up.”

She also points out why this keeps happening. Designers fix things behind the scenes, and clients often never hear about the problem at all. That means the client doesn’t approve the time, doesn’t understand the labor, and doesn’t expect to pay for it next time. You don’t want the client to see any friction or be aware of any issues, but issues do in fact arise, they are common, they are normal, and clients know they will occur. Sadly, keeping it all to yourself is an easy habit to fall into, especially when you want the project to go smoothly, but it trains your business to operate on free work.

“I know designers that have fixed the issue, spent 15 hours behind closed doors, and the client didn’t even know that that happened.”

The finance through-line here is simple: if you want a profitable firm, you have to stop funding the project with your own margin, but you also have to respect the client’s wishes. Laurie keeps circling back to communication and consent. If something will take five hours, say so. If a decision needs both spouses present, slow down and get agreement. When you set that expectation early, there won’t be any “surprise billing”. But, as Laurie points out, consent is just as important (if not more so) than communication, so the client must be on board.

“If we were truly honest with a client, we’d sometimes have to say that it can take the equivalent of the price of a product in time to find the right one, like the perfect light fixture for a dining table in the right size, shape, and price point. Some clients don’t care about that level of perfection and don’t want to pay for that time, while others do. So we need to be more upfront and communicative about what clients actually value, whether budget matters more than design perfection, because it’s their house, not ours. And that means having clearer strategies and conversations from the very beginning to set the process up for success.”

Episode 56: Profit First – Why You’re Not Keeping More of What You Earn

Listen to this podcast if… your bank balance looks fine, you’re busy, and you still can’t tell what’s actually yours.

We’ve explored the content of this episode in the past, but the full recording is absolutely worth a listen. This episode is Laura and Melissa walking through a money habit that changes how you run the business day to day. They’re not talking about saving more or “spending less.” They’re talking about deciding what profit needs to be first, then building the rest of your year around that number. If you’ve ever looked up in November and realized you worked all year for whatever happened to be left at the bottom, this conversation will feel quite familiar.

Most firms do revenue minus expenses and accept whatever “profit” ends up on the last line. But LUDC does the reverse. Laura’s firm chooses the profit target, then treats the remaining bucket as what the business is allowed to spend. That single shift clarifies a lot of the decisions owners get stuck on, from hiring and photo shoots to subscriptions and marketing spend.

“We kind of flip the script a little bit on that where it’s our revenue or the sales that we’re making for furniture and time billing minus the profit that we want to make equals our expenses.”

Laura is very clear about why this matters for interior design firms in particular. A lot of the money moving through your account is not your money. If you sell furnishings, deposits can make the bank balance look huge, and that can tempt you into decisions you can’t actually afford. The firm might have $800,000 sitting there, but half of it is already committed to vendors. You still need to pay it. You’re just holding it for a while.

“Don’t confuse your bank balance with spendable cash.”

They also make a useful distinction about what profit is and what it isn’t. Profit isn’t only “extra money to take home.” It can be retained earnings for hiring, a lease, marketing, or building cash reserves so you’re not panicking the next time a project stalls in construction. Melissa treats profit as non-negotiable even when your goals aren’t personal income. If you want to expand, pay your team well, or fund growth without relying on credit, the business has to generate surplus.

“Looking at profit as a non-negotiable. It’s a must. It’s not a leftover.”

The episode connects Profit First to the way they bill and plan. Laura is blunt about how fixed fees used to hurt her. She describes losing money because scope shifted and she didn’t want to go back to the client to reset expectations. That’s why they keep returning to hourly billing. It makes revenue steadier month to month, and it makes team growth easier to model because you can see whether a person’s billable time covers their salary and overhead.

“Prior to that we were doing fixed rate [and we would just lose] on every project because we would way over work every project or scope would change and I was too afraid to go back to the client to ask for more.”

During one part of the episode, Laura and Melissa run the numbers using a million dollars in revenue, a 50% gross margin, and 10% net profit, then imagine what it would take to reach $200,000 instead. It isn’t motivational. It’s practical. If you want to double net profit, you usually don’t get there by trimming a few software subscriptions. You get there by growing revenue, tightening margins, renegotiating vendor terms, and choosing projects that can support the target.

“So let’s say you want to make $200,000 in profit because we are profit first. That’s what we’re thinking about. So if we want to drop 200,000 to the net profit line, what levers are we pulling?”

Their larger point is that profit-first thinking forces you to stop guessing. You pick a number, then you have to build a year that can actually sustain it. You may not hit it right away, and they’re honest about that. But you’ll stop running the firm off vibes, a big install month, or a checking account inflated by client deposits. For a firm that sells a lot of furniture, that distinction is not minor. It’s the difference between a busy year and a profitable one.

Episode 55: The Hidden Profit Potential in Time Billing for Designers

Listen to this podcast if… you bill hourly, or want to, and you’re not entirely sure whether your system is actually protecting your margin.

This episode is Laura and Melissa talking through time tracking and time billing as a core business system rather than a necessary annoyance. They’re candid that none of this is glamorous, but they also insist it’s essential. The conversation keeps returning to one simple idea. If you bill hourly, your process for capturing time determines whether you’re being paid for the work you’re already doing.

They start with something very mundane that ends up being quite powerful. LUDC bills on the 10th of every month, “like clockwork.” That consistency matters more than it sounds. Clients know when the invoice will arrive, the team knows when entries are due, and cash keeps moving through the business even when construction schedules shift. Laura admits she hates tracking time, which makes the whole thing feel human. You can believe in a system and still find it irritating on a Tuesday morning.

They also explain why hourly billing shapes how they work with clients. Laura likes it because it removes constant arguments about what is or isn’t “in scope.” A client can ask for something new and she can usually say yes, then bill for the time it takes. They still give estimated ranges at the start of a project and update clients if scope changes, but the structure lets them handle real projects without pretending every detail was perfectly defined on day one.

“I never have to say no to a client request ever.”

On the mechanics, Melissa walks through how they actually do this. They use QuickBooks Online to log time and create invoices. Ideally, time gets entered in real time or at the end of the day. Laura admits she often logs weekly by looking back at her calendar and memory, and she’s honest that this probably means she misses hours. That detail matters. Underbilling usually isn’t dramatic. It’s slow, habitual, and quiet.

They spend some time on how entries should look to a client. Their firm tracks by phase, but Melissa stresses that smaller teams can keep this simpler. What really counts is clarity. Phase labels alone don’t mean much to homeowners, so they prefer descriptions that say what actually happened that month. There’s a small but revealing language choice here. They avoid the word “meeting” and use “collaboration” or “correspondence” instead, because it better reflects design work that moves a project forward.

When it comes to what they don’t bill, the line is fairly clean. If the firm truly made a mistake and has to backtrack, they absorb that time. If a client changes their mind, a product goes discontinued, or procurement delays force re-selection, they bill for it. Those hours are still real work that the project needs, and they treat them that way.

Toward the end, they connect time tracking to profitability more explicitly. They mention a gross profit target in the low 50s for time billing and explain that salary is treated as cost of goods sold. Laura pauses to clarify she is not taking home half of every hour billed. Overhead still exists, and it’s not small. The data also helps them price future projects, compare efficiency across similar jobs, and do clearer hiring math.

Laura closes by being blunt. Fixed fees have never worked for her over a long career, even when they looked tempting. Hourly billing, paired with disciplined time tracking, is what has kept the firm profitable.

“If you’re going for profitability, hourly billing and tracking your time is where it’s at.”

Why Most Design Businesses Fail by Year 5 (And How to Avoid It) with LuAnn Nigara

Listen to this podcast if… you’re past the early adrenaline stage and you’re starting to realize that talent and taste don’t automatically create a stable business.

Laura and Melissa bring in LuAnn for a conversation that circles one question from a few different directions: why do so many firms hit a wall around year five? LuAnn’s answer is that designers spend the first stretch doing whatever it takes to land work and deliver it, then wake up one day and realize they’ve built a job that runs them. The first years can be productive and chaotic at the same time. A lot of businesses survive on that energy until they simply can’t manage it anymore.

LuAnn built her original business, Window Works, with her husband. He handled operations and finance; she drove sales. The “awakening” for her came later because she had a built-in safety net: someone next to her insisting on margins, projections, and the math that keeps the lights on. When she finally looked up and started paying attention to how the business ran, she realized most creatives do not have that partner. They have to build those muscles themselves, usually while they’re already exhausted.

“You need a financial system.”

She keeps coming back to the same non-negotiable. If you don’t set a revenue goal at the start of the year and break it down into something you can actually measure, you end up in a loop where you’re busy but directionless. She talks about working backwards from a December number all the way down to the week and the day. You have to know how many projects, what mix, and what margins you need if you want the year to end in a predictable place.

A big part of this episode focuses on hiring, which comes up a lot on our podcast. LuAnn argues that most owners hire the wrong first person. After a bookkeeper, she wants the next role to be a studio or office assistant, not a design assistant. Her reasoning is simple and a little uncomfortable if you’ve already made the hire. Most principals don’t actually want someone “designing” beside them in year one. They want orders placed, samples pulled, trades scheduled, inbox triaged, and follow-up handled. Those are the tasks that eat the day and keep the principal from doing billable work at the higher rate.

“Now you’re taking those $10 an hour jobs off your plate and reserving your time for those $250 hour billable hours that only you should be doing.”

They also spend a chunk of time on billing, and this is probably the part of the episode that most listeners will replay. LuAnn doesn’t care whether you bill hourly, flat fee, or a hybrid. She cares whether you understand your own model, can explain it cleanly to a client, and can prove you’re profitable inside it.

As a consumer, LuAnn argues, what people resent isn’t a high fee. They resent petty invoices and surprise add-ons that feel insulting. Her point is that clients would often rather pay a realistic number up front than get a drip of small charges, or watch you underquote and then scramble behind the scenes. There’s a lot of truth in that, even if you don’t adopt her exact approach.

“What’s wrong about billing is not having it clear for yourself how you do it and not being able to explain it with clarity to your consumer because a confused mind can’t buy.”

By the end, LuAnn tells emerging owners to commit to the job they actually signed up for: sales, marketing, operations, finance, leadership. You don’t have to be world-class at all of it, but you can’t ignore it. And if what you really want is to design all day without carrying the rest of the business, she says it’s fine to work for someone else and make a great salary.

There’s a line late in the conversation that sums up the whole thing. A firm is not a charity. It needs markers that indicate health. Without that, you can collect a lot of money, spend it, and end the year confused about where it went. You’re really just moving money around. If you’ve ever stared at a tax return and thought, “How can that be true when my account balance says otherwise,” this episode will help!

Episode 67: Client Red Flags That Cost You Time, Profit, and Peace

Listen to this podcast if… you’re juggling a client who expects high-touch service and keeps pushing past normal boundaries.

Laura and Melissa talk through client personality and the difference between a discerning client, a demanding client, and a client who’s simply difficult. Laura explains that firm owners really need to be able to “tell if your client is discerning, demanding, or just flatout difficult,” because “there is a fine line… between high standards and toxic behavior.”

Melissa’s definition of discerning is simple and, honestly, generous. “Discerning clients are actually our best clients,” she says. They “know what they want,” want “excellent quality,” and they’re “respectful about it.” They also trust you “to a degree because they chose to work with us,” which matters when you’re trying to run through a process and not just react to every message.

Demanding clients can still be workable. Laura calls it “demanding but fair,” and Melissa agrees. They’re “really intense,” they want things “done their way or really fast,” but “they’re manageable.” Laura adds that a client can be “discerning and demanding” at the same time. The dealbreaker is when the respect disappears. “If you’re a [jerk], that’s different,” she says, because “that’s where the respect is lost.”

But what crosses the line? We all have different tolerances for disrespect, but focusing on how it impacts the work and your staff is a good place to start. Melissa describes clients “contacting you at all hours of the day,” “expecting you to have all of these answers,” and “wanting you to go outside of your process to fit their needs.”

“When somebody’s contacting you 17 times in the course of 20 minutes… It’s just not sustainable.”

The red flags at intake are familiar; we all need to pay attention instead of dismissing them. Laura lists the comments that usually signal trouble: “Why is this so expensive?… I could do this myself… Why am I paying you this huge markup to do it?” She calls out what’s underneath it all: a “diminishing of the value that we provide as interior designers.” Melissa’s version is blunt too. Watch for the client who “does not trust you from the outset and you know it.”

If you’re already mid-project and a decent client starts pushing harder, their advice is to reset expectations fast. Melissa suggests regrouping and restating the goal: “Let’s regroup. What’s the goal here? We share your goal. We are not in opposition.” Then bring them back to the structure: “you’re demanding and we’re here to meet those demands, but it’s going to be within this framework.”

And don’t sugarcoat reality just to calm them down for the afternoon. Laura says it directly: “don’t sugarcoat it,” because “you’re going to be having that same damn conversation in a month.” Deliver the news, explain the reason, then explain the plan. “Here’s the reason, facts. This is what it is, and this is how I’m going to handle it for you.”

More About the DesignDash Podcast

Each week, Laura Umansky and Melissa Grove sit down with designers, business owners, and people who actually run the companies shaping the industry. These conversations are not theoretical. Referencing their real-life experience, Melissa, Laura, and their guests talk about what it’s like to build a studio for real, with all the judgment calls, missteps, and decisions that never make it into a glossy case study.

Our podcast assumes you care about design and also about running a business that can support great work. That’s an important distinction. If you’ve ever felt like you were building your practice in isolation, the DesignDash Podcast will finally prove to you that you’re not alone.

Written by the DesignDash Editorial Team
Our contributors include experienced designers, firm owners, design writers, and other industry professionals. If you’re interested in submitting your work or collaborating, please reach out to our Editor-in-Chief at editor@designdash.com.