Margins and Markups

Course details

Many interior designers confuse the basic concepts of margins and markupsa mistake that can cost the typical small design firm thousands of dollars a year. It's even possible that mistakes may have been permanently introduced into an accounting software program, compounding losses over time.

Or, if the error is in the other direction, it's possible that designers may not be charging clients exactly what's stipulated in their contracts. We've seen lawsuits filed over just this issue.

In other words, both for reasons of bottom line profit and self-protection, it's critical that designers understand the difference between margins and markups, how to calculate them, and why it's so easy to make mistakes in the process.
In this short course, designers will;

• See specific examples of how to apply predetermined markups, and how to calculate the margins on that item.
• Why margins and markups are never the same!
• How a simple mistake can cost 5-7% to the bottom line
• The simplest possible way to avoid ever making a mistake

For those who want to go further, this course even includes an Excel spreadsheet that you can download, and play "What if? games by trying out various scenarios related to revenue, overhead expenses, billing rate...and profit margins!

In fact, this simple spreadsheet tool can help you to determine the best strategy for your firm. Is it to bill more time at a higher price per hour? Or, perhaps it's to lower your billing rate (increasing volume) and then sell more product? Or, is it to carefully select the product that you offer, making sure to protect your margins?

These are just a few of the many things you'll learn in this vital course that David Shepherd has taught to live audiences many, many times. It is information you simply must know...even if you just have to memorize it.

Every interior designer must master these fundamental concepts.