How to Avoid Budget Mistakes that Could Really Cost You
Creating a budget can definitely be a pain. But if you DON’T create one – or one that doesn’t fit the project – it can cost you a lot of money in the long run! Trust me. I have learned the hard way!
Here are 5 pitfalls to avoid when designing the “right” budget for your project:
1. Not Having a Budget
How can you stick to a budget if you don’t even have one?!? A budget is a great guide, for you and your client. And it helps you avoid unpleasant surprises when working with your clients. No one likes to find out about hidden costs, especially when they are expensive. Setting up a realistic guide of expenses in the beginning will give your client a solid idea of the actual costs and will help you understand what the client’s limits are. No one should be guessing at what the expenses will be – map that out in the beginning! It should be in writing, and your client should sign off on it.
2. Ignoring the Budget
This can happen in one of 2 ways: either you assume the client has “wiggle room” or you don’t communicate any changes to your client when they happen. Both are BIG mistakes. Never ever assume your client can spend more than they’ve told you. That’s going to lead to trouble. However, everyone must understand on the onset of the project, that issues can (and WILL!) happen in a project. Be sure to bring this up at the beginning, middle and end of a project, so you all understand the impact to the bottom line. If something is going to be more expensive, offer ways to adjust in other areas to help offset costs. Your clients will LOVE you if you present a possible solution! It lets them know that you DO think about their Return on Interiors! In both cases, honesty is the best policy.
3. Not Looking at the Big Picture
How many of you include accessories in the first design and budget you show your client? Most designer don’t! (Confession: In the beginning I didn’t!) Unfortunately, that can lead to major issues down the road. A client can either be overwhelmed by the end of a project, or may be burned out by too many changes and other expenses (who knew there was a pipe THERE?). You never want your client to say, “All of those pillows, rugs, and draperies can wait!” Since accessories are a big part of the budget talk about them-and add them to the budget- from the beginning, so they don’t get treated like an afterthought!
4. Impulse Purchases
I’ve been on a trip before and have seen the absolute perfect accessories for my client’s home. Morocco, anyone? I came home with CRATES of accessories! I felt I HAD to buy them, even though they weren’t part of the original plan. It was a BIG mistake! Yes, some were gorgeous, and the clients loved them, but some big ticket items, just weren’t right for the space. Ugh. Don’t make my mistake, impulse purchases don’t always work out, and giving in to them can create budget nightmares! If you have a willing client (one that wishes she could have gone to Morocco with you,) talk about possible purchases openly. It is hard not to get caught up in the moment, so remind your client (and yourself) that you want the project to come in on time and on budget, so any purchases need to be carefully considered.
This is what I remind myself :)…
5. Not Adding a Cushion
As I have said before, something WILL always go wrong, even in the most carefully-planned project. So it’s always a good idea to have a “cushion” in place for emergencies and challenges. And please remember those hidden costs that we all forget, like shipping and handling, and taxes!
Money is a touchy subject, especially for your clients. But if you approach it honestly and openly, you will create trust that will go a long way with your client! It will save you an enormous headache in the future. To help you keep on track, download my FREE ROI Design Budget Worksheet here!
PS – If you REALLY want to keep your projects running smoothly and efficiently, check out my Return on Interiors system! It’s designed to make your business more profitable, more organized, and more FUN for you! Just click here to learn more.