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6 Invoicing Mistakes Designers Can Avoid with the Right Accounting Software

There is a lot more to running an interior design business than meets the eye. Designers are known for their creativity, but the artistic part of the job is only the tip of the iceberg. It is the visible part of a process that goes far deeper and wider under the surface. The business part of a design project is like a behemoth of murky mass — it is by far the biggest part of the whole, and it can sink your ship if you don’t thoroughly understand each component.

Therefore, just like the creative part of your job, steering the ship of your design business requires keen attention to detail with regard to finances, the crux of which is invoicing. Invoicing in this field is complicated, but while many designers want to put it on the back burner to avoid the headache, getting it right should be a top priority. After all, what is a business without profit? Here are 6 of the most common invoicing mistakes made by interior designers and how to avoid them using the right accounting software:

1. Forgetting to invoice at all

With so many moving parts in any given project, it is easy to forget to invoice a client for small things here and there, such as a few hours of your time or a piece of furniture. However, these seemingly small oversights can add up to become extremely detrimental to your business, which is why it is essential to keep a record of all your purchases and billable hours.


A software solution that allows you to utilize your list as an action plan is an efficient way to make sure nothing slips through the cracks. In Design Manager, an accounting and project management software for interior designers, entering these specifications is just the first step in a workflow process that concludes with collecting payments on client invoices. You only have to enter data once for the workflow to begin.

2. Taking too long to send out invoices

Timeliness is a key element of professionalism. Waiting too long to send invoices to clients will not only wreak havoc on your internal affairs, it also sends a worrisome signal to clients that you are disorganized. Following a standardized process, like Design Manager's, of collecting deposits on Proposals and then invoicing for the balance at the end of a project will keep cash flow and expectations from the client organized.

Adhering to this policy will give you and your clients the incentive to issue and pay invoices in a timely manner. Because it was created specifically for interior designers, Design Manager will automatically facilitate this process throughout  a project, allowing you to focus your attention on design.


3. Sending out too many invoices

Sometimes a designer puts various pieces together to create one finished product for a client. If that designer were to invoice for each individual component, the client might be confused or unnecessarily overwhelmed. For clarity, it’s beneficial to send a client one or two invoices that summarize the purchases. Design Manager makes this easy by allowing users to break out the components of an item. Each component can be separately tracked while always being viewed as part of the item. This allows for a streamlined, easy to understand invoice for the client that doesn’t sacrifice the granular detail needed by the designer.

 

4. Not giving adequate details in your invoices

On the flip side, sending clients fewer invoices for large, un-itemized sums is also a mistake. It is important to strike the right balance between too little and too much information. Sending invoices that clearly show what is included in the balances due will eliminate confusion for both designer and client. A good way to reinforce this process and build trust with clients is to issue proposals for client approval and then use the same images, labels, and descriptions in the invoices to follow. Design Manager will automatically maintain this consistency across client documents.

5. Making mistakes on your invoices

While the possibilities are endless, common mistakes that designers make when creating invoices include forgetting to add freight and/or sales tax. Doing so can put a designer in a bad position with clients, who might expect the designer to pay for the mistake. Also, forgetting to factor in a designer discount or markup will either cost you in client trust or dollars in your pocket. Ultimately, it is the designer who will suffer for these slip-ups. This is yet another area where the right software can help — Design Manager will save your discount and fee calculations and apply them with the click of a button, so you don’t have to reinvent the wheel with every invoice. It will also add freight and sales tax information, which is carried through from purchase orders and doesn’t require repetitive manual entry.

6. Losing sight of the Bottom Line

With so many balls in the air at once, it is all too easy for interior designers to lose sight of the bigger picture. Any business owner should be able to see a snapshot of where they stand financially, yet a majority of the standard accounting software on the market can’t do this for the detail-heavy interior design business model. Therefore, choosing an industry specific solution such as Design Manager is crucial, because it is the only option that captures the detailed information needed to generate overall profit/loss reports with the click of a few buttons. Also, Design Manger is an Accrual Accounting system, which allows the system to record the sale or the purchase of goods prior to receiving the payment from your client or sending payment to the vendor, so you can determine where things will settle once money arrives to the intended destinations.

Managing an interior design business is a massive undertaking, but leaning on a software solution specifically created to handle the volume of details and complicated workflow this industry demands will allow for smooth sailing. Invoicing does not have to be tedious and pain staking if you use Design Manager to do the work for you. Remember, it is not only about making your life easier, it is about your image as a professional. Avoiding these common invoicing mistakes will have clients raving about your fabulous designs instead of passing on stories of disorganized business practices.

Start streamlining your invoicing process and create professional, branded client documents today with a free trial of Design Manager.

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Lindsay Paoli
Lindsay Paoli
Lindsay is in charge of the Sales and Marketing team at Design Manager and has enjoyed growing the DM company for the past 10 years. In her spare time though, you can find her taking care of her two adorably demanding little rugrats, traveling, enjoying new restaurants or cheering on her beloved Philadelphia sports teams with her friends and family.

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