The Business Model Decision That Will Make or Break Your Design Firm
When interior designers think about growing their businesses, they often focus on marketing, pricing, and client acquisition. But before tackling those challenges, there’s a more foundational question that too many designers overlook: What kind of firm are you actually running?
The biggest mistake many interior designers make is blurring the line between these two models—wanting the high fees of a customized firm while structuring their business like a productized one
At the heart of every design business, there are two primary models: the customized firm and the productized firm. Understanding which model aligns with your business—and ensuring that your pricing, marketing, and client interactions reflect that model—is essential to breaking free from the feast-or-famine cycle and building a firm that supports your goals.
What Is a Customized Firm?
A customized firm offers tailored, high-touch, and often complex services unique to each client. The business model is built around expertise, deep client relationships, and strategic problem-solving rather than standardized deliverables. In the world of interior design, most high-end and boutique firms fall into this category.
Key Characteristics of a Customized Firm:
Every project is unique, requiring a deep level of personalization and innovation.
Pricing is value-based rather than tied to hours worked or deliverables.
The business model scales by increasing fees per project, not by taking on more projects.
Clients expect a concierge-like experience and are often investing in the firm’s vision and expertise.
Branding, positioning, and client education are crucial to attracting the right clientele who value customization.
A customized firm thrives when it secures fewer, higher-paying clients and prioritizes deep, strategic project execution rather than volume. For most interior designers who prefer to work with a limited number of clients per year (5-6, on average), operating as a customized firm makes the most sense—if structured properly.
What Is a Productized Firm?
A productized firm offers standardized services, often at fixed prices, with clear and predictable deliverables. These firms operate more like businesses with packaged offerings, allowing for efficiency, scale, and ease of sale.
Key Characteristics of a Productized Firm:
Services are clearly defined with set deliverables and pricing.
Profitability is driven by efficiency and volume rather than deep customization.
The client experience is more transactional, with streamlined workflows and limited personalization.
Marketing focuses on clear value propositions and making the buying decision easy.
Revenue can be more predictable due to standardized offerings.
Examples of productized firms in the interior design industry include e-design services, design consultation packages, or firms offering pre-set furniture and finish selections for developers. Productized firms scale by increasing the number of clients they serve, either through automation, efficiency, or delegation.
Why Understanding the Difference Matters
The biggest mistake many interior designers make is blurring the line between these two models—wanting the high fees of a customized firm while structuring their business like a productized one. This leads to pricing inconsistencies, marketing mismatches, and difficulty securing the right clients. It’s why so many designers struggle with:
Clients asking for hourly rates or price breakdowns.
Feeling pressure to justify their fees based on deliverables rather than expertise.
A never-ending cycle of overwork without increased profitability.
Which Model is Right for You?
There’s no right or wrong answer—both models can be successful. However, it’s crucial that your business structure, pricing, marketing, and sales strategies all align with your chosen model. Ask yourself:
Do I want to work with a limited number of high-touch clients or scale through volume?
Am I comfortable selling expertise and value, or do I prefer offering clear, packaged deliverables?
Do I want to build deep client relationships or provide efficient, repeatable solutions?
By identifying whether you are (or want to be) a customized or productized firm, you’ll gain clarity on how to price, market, and run your business effectively. In our next post, we’ll dive deeper into why many interior designers struggle with pricing—and how aligning with the right business model can help.