Episode Two | Managing Price Changes in Interior Design

Top Branch Podcast

Ruth Ann Janson
Hi, I'm Ruth Ann Janson, and this is Beth Bender. We are back for Episode Two of TopBranch. Today we’re talking about a topic that is near and dear to my accounting heart.

Beth Bender
[laughs] Yeah, I mean, there are a lot of risks that can impact a business—pandemics, tariffs, or other large-scale disruptions—but the risk of price changes, while smaller, adds up. It’s all the tiny things that accumulate into something big.

Ruth Ann Janson
Exactly. Some of these changes seem minor, but they can create real issues over time.

How Price Changes Impact Procurement

Beth Bender
Everyone has a war story about a price change going bad—when you’ve had to reselect because the client won’t accept the new cost. That creates a trickle-down effect, and it’s especially tough during procurement.

If you wait two or three weeks to place an order, you might get hit with a price increase that could affect your entire project. If your client won’t approve the new amount, you’re suddenly reselecting and adjusting your whole scheme.

That’s why it’s so important to have a process in place that aligns with the vendor’s timelines—whether that’s 24 or 48 hours. You need to know when price protections expire so that unexpected increases don’t derail everything.

Ruth Ann Janson
Yes, exactly. If you're not acting quickly, you risk more than just a minor price hike—you might have to revisit selections altogether.

Key Practices for Managing Price Changes

Ruth Ann Janson
There are three main takeaways for managing price changes effectively.

1. Have Clear Contract Language
Your contract should clearly state that any price changes are the client’s responsibility. Whether it’s due to tariffs or vendor adjustments, you shouldn't be the one absorbing those unexpected costs. The client can decide to reselect or go a cheaper route, but it should never fall solely on the designer.

Beth Bender
Absolutely.

Ruth Ann Janson
2. Use a System That Tracks Price Changes
Whatever system you're using to manage your back office should have a feature for tracking price changes. Most robust systems do offer this, but many designers don’t take the time to figure out where that feature lives or how to use it effectively.

Beth Bender
Exactly. Identifying those tools within your system is essential. The software can’t help you if you’re not leveraging its full capabilities.

Ruth Ann Janson
3. Communicate With Clients Promptly
When price changes occur, talk to your client as soon as possible. Clients don’t enjoy hearing about a price change, but they really dislike hearing about it weeks later when there’s no room left for choices.

Setting Expectations With Clients

Ruth Ann Janson
Good communication means proactively discussing thresholds with your clients. For instance, some of our clients have agreements that say, “If something changes by more than $500 from the original quote, we’ll go back to the drawing board.” Others use a $100 threshold. It depends on the client, but the agreement should be set up front.

Beth Bender
We do that in our procurement process at The Dove Agency. We ask clients upfront: “What’s the threshold where we can proceed without needing your approval in case of a price change?” That helps eliminate the feeling of being nickeled and dimed. It’s about trust and efficiency.

Ruth Ann Janson
Exactly. Setting expectations in advance makes for smoother communication and fewer surprises.

Monitoring Overall Project Profitability

Ruth Ann Janson
Another important practice is tracking the overall profitability of your project. If you're working with a 25% or 30% markup, you should know how you're doing against that. Then, when a price change hits, you can decide: “We’re doing well on this project—I’ll absorb the increase,” or “We’re running tighter than expected—this needs to go back to the client.”

Beth Bender
Right. It helps you make smarter decisions based on data rather than emotion or guesswork.

Hidden Price Changes: Watch Out for Small Purchases

Beth Bender
One more thing to keep in mind—if you run out to do an install or go to an antique fair and grab a few items, and then forget to bill everything to the client, that’s effectively a price change. You spent money that’s not accounted for.

Ruth Ann Janson
Yes! That is a price change.

Beth Bender
So review your credit card charges weekly or monthly, and ask yourself: “Did this get invoiced to the client?” Because if it didn’t, you’ve taken a hit that might go unnoticed.

Ruth Ann Janson
Exactly. Those little last-minute purchases can add up. If they’re not tracked and billed, they quietly erode your profitability.

Closing Thought: Inputs Drive Outcomes

Ruth Ann Janson
That’s actually a great lead-in to the quote I want to share as we wrap up. We’re quoting James Clear again—yes, again. But it’s a good one, and we promise we’ll mix it up next time.

Beth Bender
We just really love his work.

Ruth Ann Janson
Here’s the quote:

“The edge is in the inputs. The person who consumes from better sources gets better thoughts. The person who asks better questions gets better answers. And the person who builds better habits gets better results. It's not the outcome, it's the inputs.”

So consider every small price change, every unbilled purchase—those are inputs. If you monitor them properly, they’ll help you achieve the profit you’re expecting from each project.

Beth Bender
Absolutely.

Ruth Ann Janson
Thanks for listening, and we’ll see you next week.

Beth Bender
Take care. Bye.

Ruth Ann Janson
Bye.