The butcher, the baker, the candlestick maker: they’re not just three characters in an old nursery rhyme. All three of these children’s book stalwarts also use QuickBooks for their accounting needs! We’re joking, of course. But it should be noted that one profession we don’t see mentioned here is that of interior designer, and that’s for good reason. Designers demand their own purpose-built solution when it comes to just about everything, from design-only public relations firms to industry-informed communications teams to custom millwork, metalwork and mosaic artisanship. Why wouldn’t designers apply the same level of hyper-focused customization and select custom-built accounting software for interior designers?
The unfortunate reality is that many are still relying on a mishmash of digital tools — QuickBooks and other general audience software among them — when it comes to managing the backend (and often frontend, too!) processes of their interior design businesses. Though these are the same tools available to the average butcher, baker or candlestick maker, designers find themselves making do, creating workarounds for generic tools, or wasting hours using manual labor to complete accounting processes.
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However, a customized solution isn’t just helpful; it’s critical for the continued health and future growth of any interior design firm. A powerful accounting software for interior designers ensures accounting stays manageable and can give designers access to information needed to make smart and profitable business decisions.
Here are our top 5 reasons that designers need accounting software for interior designers built just for them and their businesses.
1. Product Sourcing Overload: Purpose-Built Software Saves Designers’ Sanity
The sheer amount of product passing through designers’ hands, both literally and financially, is staggering. Each item for each project requires an accurate accounting, in multiple meanings of that term: an accounting of the actual cost to the designer, the client markup, and the placement in a particular room, among other key factors. Without an accounting software for interior designers properly tallying of each piece, financial troubles can abound, from unpaid invoices that accrue hefty late fees to delayed or entirely forgotten tax bills. Speaking of tax bills…
2. Specialized Software Simplifies Tax Purchase Dilemmas
Designers should have a way to collect client deposits that doesn’t immediately translate into paying taxes on items that may be, for example, returned in a month’s time. Accounting software for interior designers should have the functionality to collecting a deposit and leaving the payment in a designer’s account as just that — a deposit — can eliminate back-and-forth over tax payment when the time comes. (Designers therefore don’t need to remit tax on an item right away if the client deposit is classified as such from the get-go.)
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Any designer who has dealt with a wishy-washy client understands the value in the old adage, “It ain’t over ‘til it’s over.” A product, even a custom one, isn’t officially paid for until the client signs off on it for the final time. And, until that moment, an alternative always threatens to take its place. Avoid paying taxes prematurely on items that may not be final selections by using an accounting software for interior designers that classifies deposits as deposits and ensures that money does not immediately hit your income statement.
3. Great Accounting Software Gets You a Treasure-Trove of Data to Power Your Business
Sure, a massive bakery chain may need to undergo the same level of detail as the average designer. But designers in particular stand to benefit from knowing exactly where every dollar of a project goes. In their case, it’s not just about tracking dollars spent and dollars received. It’s also about getting a picture of where the firm, at large, is when it comes to efficiency, trends and financial flow.
Consider: Does one designer on the team tend to overspend in, say, the outdoor furniture category? Is the firm as a whole spending a ton of funds at one particular vendor — a vendor who might be willing to, for example, negotiate a better discount or provide improved customer service if they were reminded of the firm’s high spend? Are there items that have been ordered but never received?
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An accounting software for interior designers that can toggle, and sort, by a range of different categories — think room; vendor; payment status; subtotal; etc. — is worth looking in to for a variety of reasons. Having a deep view into a firm’s project reporting can yield fascinating discoveries and may even lead to new businesses. (Imagine forming a more strategic business partnership with a local cabinet maker who, it turns out, has completed 85% of a firm’s millwork projects over the last few years?) From an even more strictly practical POV, designers can also use it to identify outliers, such as pieces that have been ordered but never received or paid for.
4. Diverse Payment Methods Demand a Custom-Built Solution
Struggles with time billing can lead to payment snafus, lost wages and even overpayment. In software like QuickBooks, a fixed product rate structure is standard, but at design firms, the pay rate from employee to employee is often different and determined by role or task. Rates can vary from junior designer to senior designer to principal, as well as among varied tasks like drafting, and additional factors like travel time. Using custom-built accounting software for interior designers — who will input many entries across various activities throughout a project’s life cycle — can reduce confusion and improve efficiency.
READ ALSO: 5 Reasons to Invest in a Project Management and Accounting System for Time Tracking
5. Designers Can Leverage Past Successes
Just as QuickBooks and its compatriots offer generic accounting software for interior designers, plenty of inspiration-first platforms exist to help creatives source inspiration. Pinterest is a reliable go-to for designers and their clients of all kinds, of course.
Design firm team members should be able to easily “clone” items from past projects without the need to specifically save them to a favorites library; it’s a function, in other words, wherein a list of items used across all a firm’s projects essentially becomes a library. A system that can keep track of past projects and show you the profitability of each item allows you to make informed decisions as to which items to reuse for new projects.
Want to retrieve a wicker stool from a project done a decade ago? With the right digital tools, outfitted with a system built to handle every item a designer handles, designers can access that older project and clone the item for use in today’s project. A simple system like this offers flexibility since team members can pull information about profitability across years’ worth of projects.
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Designers are long familiar with requesting custom solutions. Choosing purpose-built accounting software for interior designers should be no exception! Whether seeking to streamline client payment, reduce the burden of tax season, identify areas of inefficiency, or even suss out any clever business opportunities lurking just below the spreadsheet numbers, savvy design firms can come to rely on customized accounting software designed with their distinctive dilemmas and dreams in mind.
Want to learn more about Studio Designer?
Studio Designer is the leading digital platform for interior designers managing and growing their design businesses, featuring fully integrated project management, time billing, product sourcing, and accounting solutions.
Want to learn how Studio Designer can work for your design firm? Schedule a call with our team: https://www.studiodesigner.com/get-a-demo/
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