How much do interior designers pay for products? Trade pricing is one of the more opaque machinations of the interior design trade, and there is a common misconception that all interior designers get steep discounts off retail prices, though that is not always the case. Another misconception is that discounts and access are based purely on how much a vendor likes a particular designer. This is also rarely the case.Many vendors have a predetermined system for wholesale pricing based on how much a designer buys from that vendor in a given time period (tiered) or how much they buy of one item at the same time (volume).
But there are scenarios where designers can negotiate discounts with vendors, and interior design markets are one of them, since they offer designers access to thousands of vendors, including the opportunity to score the best products at great prices.
Here are seven tips to give yourself the best chance of getting a great deal from a vendor — at a market, or anywhere else:
- Build and nurture relationships before you buy: The best thing you can do to help your interior design business is to create deeply rooted, authentic relationships with your favorite vendors. Many vendor companies will not authorize their sales representatives to give a designer preferred pricing outside of the set policy; however, having a good relationship with your representative can help you get small advantages where they are available. You also never know when a sales representative from a large, inflexible vendor will move to a small vendor with much greater pricing discretion. Relationships are everything in the business of interior design. No one wants to negotiate with someone they don’t like.
- Target smaller vendors: One of the best ways to get big discounts at a market is to target small, “mom-and-pop” shops. As covered above, the larger the corporation, the less discretion a sales representative has to give you preferred pricing, no matter how much they like you. With smaller companies if you do your research and understand the margins on a particular piece of merchandise, you can respectfully request a discount that is larger than what they are offering while still allowing them to make a profit.
- Show brand loyalty: This is where tier pricing becomes relevant, although it can also apply to less standardized systems as well. Vendors with a tiered pricing model offer discounts that vary by level of expenditure. For example, if you buy $10,000 worth of merchandise with a vendor in a given year, they will give you 30% off the retail price (thresholds/discounts vary by vendor). If you buy $50,000 of merchandise at the same vendor, you will get 40% off retail. This concept can apply to a “mom-and-pop” shop as well. If you give a vendor a lot of steady business, they will be incentivized to give you greater benefits.
- Buy multiples of an item: Many of the larger vendors offer volume discounts where the more you buy of a single item, the lower the price for the individual unit. Smaller vendors are less likely to offer this, because their pieces are rarely mass produced. If a product is handcrafted or one of a kind, the vendor does not gain any economy of scale savings that can be passed onto the interior designer buyer. But products produced in batches or in bulk do offer this opportunity.
- Offer something in exchange: We know that social media influencers get paid to show off products in a favorable light across their social media channels. The concept of the interior designer social media influencer is not exactly mainstream at this point; however, if you have a large and loyal social media following, you have leverage in a pricing negotiation. If you choose to explore a barter relationship with a vendor where you get preferred pricing in exchange for social media exposure, carefully consider the potential negative ramifications. What exactly constitutes an ad? Influencers technically have to disclose advertising for which they are paid. Your integrity may be up for critique should you go down this road. However, becoming an official brand ambassador for your favorite vendor can be a win-win. Also, you may have something less controversial to exchange, like referring a client much larger than yourself to a vendor. However you choose to explore this path, operate with honesty and transparency.
- Be open to buying odds and ends: Sometimes vendors have merchandise they want to offload. It might be a damaged product, or a product produced by mistake for a client who won’t take responsibility for it. These one-off situations provide an opportunity for you to pick up products at a negotiable price, particularly with smaller vendors. Again, the quality of your relationship with your sales representative is going to determine if you will get these opportunities at all.
- Join a buying group: One of the more inventive ways to gain access to greater discounts is to join a buying group, which is a group of designers who band together to pool their purchasing power. For example, a small design firm may only spend $10,000 a year at a vendor with a tiered pricing system, but if they team up with nine other designers who spend about the same, they can all enjoy the greater discount afforded by spending $100,000 at the same vendor. The same logic is applied to volume purchases. It can even extend to sharing greater discounts earned through relationships. If one designer gets 50% off retail, she then shares that discount with her buying group by purchasing on their behalf. Reading this, you can probably already see the potential problems with this type of arrangement. Remember, your reputation is always on the line as an interior designer. Anything you do that can be interpreted as dishonest will hurt you more than the discount is worth.
As you see, interior designer discounts are not as flexible as one might expect. Where there is room for negotiation, your reputation and your personal relationships are the key factors in getting advantageous pricing. As you prepare for any upcoming vendor visit, work on nurturing your relationship with your sales representatives and focusing on having a good time with them when you get the chance to see each other in person. If you don’t get a good deal out of it this time, you will at least gain the personal fulfillment that comes with genuine friendship.