Behind every beautiful home is a well-planned budget that factors in everything down to the throw pillows. While establishing a budget isn’t a particularly glamorous task, it is an important skill to master.
“You can’t do anything without a budget,” says designer Palmer Weiss, who worked in finance before opening her eponymous firm in 2002. “Whether you’re shopping for De Gournay wallpaper or putting some paint on the walls, it can give the entire project context.”
And yet, handling someone else’s money can be intimidating. To help, three architecture and design professionals break down their tips for setting and managing your client’s budget.
Communicate clearly from the get-go
Regardless of a project’s scope or size, determining its budget should be the very first thing on your do-to list.
“When invoices start coming, clients forget what they’ve paid, and suddenly it seems like it’s snowballing into something bigger,” explains designer Elizabeth Pyne of McMillen Inc. “If [your clients] have a good understanding of how much the project is going to cost, they can plan.”
That said, it’s important to work within your client’s comfort zone. When Luis Medina, a principal of Studio 397 Architecture, takes on new clients, he asks them for their ideal budget and offers his professional feedback.
“We make our clients aware of high-cost items such as large glass walls and extensive custom millwork,” he explains. “We try to balance their dream with their budget and keep the items that are must-haves, but remove or alter the items they are not attached to.”
Set realistic expectations
As tempting as it might be to offer a lower quote, Pyne encourages you to be honest about the budget—even if it costs you the job in the long run. “No matter how badly you want the job, you have to be honest about how much something is going to cost,” she says. “Don’t promise something you can’t deliver.”
If a client knows exactly how much a project will cost, they can either accept it or move on with no hard feelings. However, if you estimate a lower budget and end up spending more money, it can cost you your credibility and client’s trust.
Break it down
To allocate money, Pyne breaks down the budget by room, and redistributes money based on her clients’ preferences.
“It’s the easiest way to keep track,” she explains. “Some people might be willing to spend a lot on a living room, but not that much on a guest room or basement. So, we can take money out of one room and put it in another.”
With so many brands, price points, and options to choose from, determining the budget for any room can be challenging. Weiss considers the amount of furniture she’ll need, as well as her experience on previous projects.
“We know how much furniture we’ll need to make a space feel filled and lived-in, in the aesthetic we want,” Weiss explains. “If I budgeted for two chests in a living room, but ended up doing a console table and a secretary, I know I can make those numbers work in the mix of the floor plan.”
Crunch the numbers
While some design firms use accounting software like Studio Designer, Pyne creates detailed spreadsheets with Microsoft Excel. Each project McMillen does gets a cover page with the overall budget, plus separate pages for each room and hourly fees. The spreadsheet is updated as the project evolves.
“It’s great because you can see the numbers change,” she says. “If I’m shopping and see an expensive light fixture that I love, I can ask my assistant if it’s feasible.” Pyne says that thanks to this system, any stresses of going over budget have virtually disappeared for her.