As the COVID-19 crisis continues into another month in the U.S., many businesses are looking for ways to find financial relief and stay afloat in the face of the unknown. Last week, we broke down the coronavirus Federal relief program, including the CARES Act and the extension to the 2019 tax deadline, and focused on how small businesses can alleviate immediate financial pressure.
This article will look forward, outlining strategic measures interior design businesses can take to prepare for the new social and economic landscape that is emerging as a result of the pandemic. While stay-at-home orders will eventually be lifted, the former notion of “business as usual” is obsolete; interior designers must evolve to thrive in a new world.
The Right Time To Be Fiscally Conservative
Now more than ever, it's essential to be financially efficient, saving cash and only spending money on what you need to stay in business; capital expenditures can wait. In fact, go one step further and look for areas where you can cut costs, like making do with fewer supplies, a less expensive phone plan, etc. You can negotiate for lower or deferred monthly payments for loans, credit cards, or even rent, particularly if your business is currently in financial distress. Any opportunity you have to negotiate a lower price or go without is helpful.
This is also a good time to review your accounts receivables, which is one of the many helpful financial reports you can quickly pull up in Design Manager. Contact those who have outstanding balances and gently, with an empathetic tone, let them know you are still expecting payment. If they are having financial trouble, be creative; for example, offer payment plans.
Remember to pay yourself first. Often, interior designers form a close-knit camaraderie with their team. The feeling of personal responsibility as an employer combined with the sympathy of friendship can make one want to take care of their employees before themselves. However, when businesses go bankrupt, owners risk losing the company that employs their beloved teams, leaving all unemployed.
Reformatting Without Devaluing
Many interior design businesses are thinking about how to generate income and bring in new business right now. While the option may cross your mind, don't lower your fees to get more work right now. Your quality of service has not diminished, so neither should your value in dollar terms.
Instead, adapt your offering to suit a new way of doing business, where virtual interactions may become part of the norm, rather than the exception. Consider offering e-design solutions. While not easy, it’s possible to design a space without ever physically seeing it. You can walk a client through measuring their space for you. Just be sure to ask plenty of questions to understand exactly how your client intends to use the space and the context of its location.
Even if your business never had a retail component previously, merchandising can be a new revenue stream that brings in cash in short order. Leslie Bowman of The Design Bar, for instance, is offering customizable gift baskets at affordable price points, using her designer’s eye to curate small collections of accessories that can be purchased on demand. Small-scale retail strategies can generate quick profits with little risk.
Marketing Takes the Lead
The American Society of Interior Designers (ASID) has been conducting a bi-weekly survey measuring the coronavirus’s impact on the design industry; their most recent survey, conducted on April 14, found that 67 percent of interior designer respondents ranked new business development as their primary concern, up from 59 percent in ASID’s first survey conducted on March 31. While you should be cutting unnecessary costs right now, marketing should be considered essential. Know exactly what your value is and work on getting that message out to your potential client base.
Social media campaigns are a low-cost way to get widespread visibility for your brand. Also, think outside the box, like starting an interior design podcast or reaching out to get featured or interviewed in interior design publications and websites. In an interview with My Domain, Angela Belt, Founder of 28 Black Tastemakers, said she is working on enhancing her Skillshare class, How To Style a Room, as a way to reach her clients virtually.
Download our CARES Act and COVID Accounting Tips Presentation
Working with Vendors
In this uncertain landscape, where it’s hard to tell which businesses will survive, you don’t want to give orders to manufactures that may not be able to produce on time, if at all. Support your most trusted vendors. This is where relationships matter, as you will need to have an honest line of communication with your vendors to stay up to date on where they stand. You also want to have good communication with your clients, informing them when orders are halted or delayed. To avoid production issues altogether, lean on marketplaces with finished goods, like 1stdibs. When that doesn't suit your needs, check Business of Home’s Google Sheet listing to see which vendors are shipping.
There’s no denying the way the world does business is changing for the foreseeable future, if not forever. While the way results are achieved will change, interior design will remain as important as ever as more people seek to improve the quality of the spaces they inhabit.
Practicing fiscal conservatism while planning new ways to bring your talents to the people who need them will ensure your interior business thrives in an evolving world.
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