You Finished the Project. But What is Actually Profitable?

You just wrapped another gorgeous project. The client is in love with the space. The room looks exactly like the rendering, and the install photos are stunning (hello, Instagram).

Your Instagram feed is stunning. Your calendar is booked solid. Everything looks like it’s working.

So why are you not totally sure you made money on your projects?

Between the revisions, the vendor changes, and the “can we just swap this one thing?” requests, the profit you quoted and the profit you kept can look very different. And if you’re not sure where the money’s going, you’re not alone. Most designers aren’t.

Let’s fix that.

Your Invoice Total Isn’t Your Revenue

Here’s a project most designers would call a $150,000 job:

• Design fees: $28,000 (yours to keep)
• Product markups: $22,000 (yours to keep)
• Pass-through costs: $100,000 (the furniture, fabric, and freight you paid for on the client’s behalf)

That pass-through money came in and went right back out. It was never yours. So the project that feels like $150,000 actually brought in $50,000, and your overhead comes out of that number.

And that’s before your team, your software, your insurance, and everything else it costs to run your business comes out of it.

Let’s go one step further. Say you planned on 200 hours at $150 an hour (that’s $30,000 of team time), plus about $3,000 as this project’s share of rent, software, and insurance. That leaves $17,000.

Now add the revisions and the “can we just swap this one thing?” requests. Ten extra hours doesn’t sound like much, but at $150 an hour, that’s $1,500. The project actually took 210 hours, which is $31,500 in time, and what’s left drops to $15,500. Same project, same happy client, $1,500 less in your pocket.

When you’re only looking at the big number, it’s easy to overhire, underprice (or overdeliver!), and say yes to projects that barely pay you back.

Where the Money Quietly Disappears

Profit rarely disappears all at once. Most of the time, it’s the little stuff that eats away at your profit while you’re busy running the project:

• A vendor substitution eats part of your markup, and nobody notices
• Freight gets lumped in with product costs
• You mark things up 40% and assume you’re keeping 40%, but your margin is closer to 29%
• Scope creeps. A living room refresh turns into a whole-house renovation on the same design fee
• Logistics time nobody bills for. Ordering, tracking shipments, chasing backorders, and sorting out damaged freight all take hours

Procurement is the sneaky one. Placing orders, following up on delays, and coordinating deliveries is real work, and it adds up fast. On a project with $100,000 in product, 40 hours of ordering and follow-up at $150 an hour is $6,000 of time. If you’re not charging a procurement or project management fee, that $6,000 comes straight out of your margin.

That $6,000, plus the 11% gap between the markup you charge and the margin you keep, plus all the other little stuff, is often the difference between a profitable project and one running at a loss.

Try This Week

You don’t need new software or a full cleanup. Just pull your last three projects and for each one write down:

✓ Review your last three projects. Work out three numbers:

• Revenue: your design fees plus markups, not pass-throughs
• Net profit: what’s left after you subtract your actual costs, including your time
• Profit margin: your net profit as a percentage of revenue

✓ What it actually cost you, including your time

✓ Find missing costs: Look for freight lumped in with product, procurement time you never billed for, and sales tax discrepancies.

✓ What was left

If you can’t get those numbers without a lot of digging, that’s your answer. It’s not a talent problem. It’s a tracking problem, and tracking problems are fixable.

Want to know where your profit is going?

At Nouvelle Financial, we help interior designers understand which projects are most profitable, whether full-service design or full-service design + build makes you more money, and how to use your numbers to make smarter business decisions.

You’d never start a room without a plan. Your numbers deserve the same intention. When you can see what each project really profits, pricing gets easier, hiring gets easier, and picking the right clients gets a lot easier.

Ready to feel more confident in your numbers? Let’s chat.