How to Work With Clients Who Are Concerned About Costs
US design professionals share their tips to help your clients form realistic budget expectations
Erin Carlyle
22 September 2020
Former Houzz Editorial Staff. Writing about the cost of renovation and what it takes to remodel. Former Forbes real estate reporter. Fascinated by cool homes, watching the bottom line.
Former Houzz Editorial Staff. Writing about the cost of renovation and what it takes... More
As a home renovation professional, you undoubtedly encounter some homeowners who have overly rosy expectations of what their dream home renovation project will set them back. Debunking these unrealistic assumptions about design, renovation and decorating costs is a necessary part of the process. So how do you best handle that all-important conversation? We asked US-based professionals to share their top tips.
Be clear on cost from the beginning
It’s no secret that home-design television shows have helped popularise residential renovation, but these programs don’t always explain the realistic costs to viewers.
Educating clients about true renovation costs is part of the sales process, and a great place to start is determining what their budget is. “Most clients don’t want to share their budget, because they think you’re going to spend it all,” says USA-based designer Gia Milazzo Smith of Designs by Gia. “It’s so much better if you can have those conversations early.”
It’s no secret that home-design television shows have helped popularise residential renovation, but these programs don’t always explain the realistic costs to viewers.
Educating clients about true renovation costs is part of the sales process, and a great place to start is determining what their budget is. “Most clients don’t want to share their budget, because they think you’re going to spend it all,” says USA-based designer Gia Milazzo Smith of Designs by Gia. “It’s so much better if you can have those conversations early.”
Knowing the budget can help you steer clients towards an appropriate project scope or, if necessary, give them the bad news right away. “If the homeowner is so far below what I know the minimum is to build whatever they’re talking about, I’m very upfront about that,” says architect James Crisp of Crisp Architects. “I say, ‘I’m really sorry, but for what you’re talking about, I can’t tell you exactly what it’s going to cost, but it’s got to be in a range of X to Z.’”
Sometimes, Crisp finds his frank assessment triggers a client to admit that a budget has some wiggle room, and then they can begin to discuss real options. Perhaps the initial goal of replacing the kitchen and adding a new second storey is too costly, but the budget could cover a kitchen renovation alone.
Sometimes, Crisp finds his frank assessment triggers a client to admit that a budget has some wiggle room, and then they can begin to discuss real options. Perhaps the initial goal of replacing the kitchen and adding a new second storey is too costly, but the budget could cover a kitchen renovation alone.
Early conversations are also an opportunity to educate clients about what’s really involved in a project – namely, not just the products and materials to be installed, but labour for both installation and design. This can be helpful, because clients often don’t realise that the larger scope of the project itself – not saving $10 per metre on a particular fabric for kitchen curtains – is what really affects the bottom line, says Milazzo Smith.
Connect with other professionals, see their latest projects and follow them on Houzz
Connect with other professionals, see their latest projects and follow them on Houzz
Address cost throughout the project
Of course, it’s impossible to know the precise project cost until a design plan is completed and all the materials have been selected. Design is, after all, an evolving process. That’s why it’s critical, as plans progress, to keep bringing up the costs.
Architect Amy Gardner of Gardner Architects always recommends that her clients have a builder review the drawings at an early stage to get a ballpark budget estimate. “We recommend this during our initial contact discussions, and bring it up periodically during the early stages of the project,” says Gardner.
Of course, it’s impossible to know the precise project cost until a design plan is completed and all the materials have been selected. Design is, after all, an evolving process. That’s why it’s critical, as plans progress, to keep bringing up the costs.
Architect Amy Gardner of Gardner Architects always recommends that her clients have a builder review the drawings at an early stage to get a ballpark budget estimate. “We recommend this during our initial contact discussions, and bring it up periodically during the early stages of the project,” says Gardner.
Once the initial design is completed and preliminary bids have come back from builders, Crisp tells his clients, “You can have your heart attack, then we revive you and you can tell us to pull back on the design, or phase the design, or just go forwards with working drawings to get a really tight bid”. Reminding clients that they are the ones making the choices that affect the bottom line really seems to help, he says.
Similarly, every time a client makes a request to change products or materials, it’s important to mention – right then – how this change would affect the cost. That way, clients won’t be surprised later in the project and feel like charges have snuck up on them and become too high.
Builders can use Houzz Pro business management software to track and bill for change orders and send them to clients for approvals. Designers can use Houzz Pro to share proposals with clients for approval, or to allow clients to accept or decline each item, line by line.
Builders can use Houzz Pro business management software to track and bill for change orders and send them to clients for approvals. Designers can use Houzz Pro to share proposals with clients for approval, or to allow clients to accept or decline each item, line by line.
Know when to go your separate ways
If you’ve clarified costs at the beginning and as any changes are made, the topic of costs shouldn’t be uncomfortable or controversial as the project progresses. So really the decision about whether a client and a budget are a good fit must be made early on.
If the budget simply won’t stretch enough, you might gently offer would-be clients alternatives. Crisp sometimes points out that clients can do a lot with a good building designer alone, while Milazzo Smith mentions a standalone design consultation or design plan as an alternative to full design services. After all, taking on a project with a client whose budget is simply too tight can be stressful for everyone and won’t lead to a great outcome, so don’t be afraid to walk away.
“During the initial contact discussions, if the budget is too lean for the owner’s goals, I generally do not take on the project,” says Gardner.
If you’ve clarified costs at the beginning and as any changes are made, the topic of costs shouldn’t be uncomfortable or controversial as the project progresses. So really the decision about whether a client and a budget are a good fit must be made early on.
If the budget simply won’t stretch enough, you might gently offer would-be clients alternatives. Crisp sometimes points out that clients can do a lot with a good building designer alone, while Milazzo Smith mentions a standalone design consultation or design plan as an alternative to full design services. After all, taking on a project with a client whose budget is simply too tight can be stressful for everyone and won’t lead to a great outcome, so don’t be afraid to walk away.
“During the initial contact discussions, if the budget is too lean for the owner’s goals, I generally do not take on the project,” says Gardner.
Your turn
Is this a challenge you’ve come up against in the past? Tell us your experiences and tips in the Comments below and join the renovation conversation.
More
Wondering how to transition back to business as ‘new’ usual? Read Life After Lockdown: 6 Ideas From UK Firms on Adapting Offices
Is this a challenge you’ve come up against in the past? Tell us your experiences and tips in the Comments below and join the renovation conversation.
More
Wondering how to transition back to business as ‘new’ usual? Read Life After Lockdown: 6 Ideas From UK Firms on Adapting Offices
Related Stories
Trade Shows
Trade Shows: Why They're Important Events You Don't Want to Miss
From networking to insights into new and emerging trends, here's why trade shows should be a firm 'yes' in your calendar
Full Story
Interior Design
What's Next in Homes? 4 Design Experts Reveal
Do you know which colours, shapes and styles we'll be coveting in the year ahead? Four design pros give the inside scoop
Full Story
For Pros
5 Simple Strategies to Help Your Clients Stick to Project Plans
Avoid the pitfalls of indecision and shifting plans with UK pros' easy solutions to inspire confidence in your clients
Full Story
Sustainable Ideas
8 Steps to Becoming a Truly Sustainable Interior Designer
What key things can you do to reduce the carbon footprint of your projects and business, long-term? Find out here
Full Story
Trends
6 Trends From Salone de Mobile: The Stories Behind the Designs
See how the design industry is moving forward with one foot in tradition and the other in experimentation and innovation
Full Story
For Pros
Given the Economy, Why Are Professionals Positive About Growth?
The Houzz Australia State of the Industry report uncovers optimism and reveals pros' strategies for growth in 2023
Full Story
Colour
Paintbrushes Poised! 2023 Dulux Colour Awards Finalists Are In
Looking for interesting ways to add colour at home? Check out these shortlisted projects in the 2023 Dulux Colour Awards
Full Story
Renovating
What's the Outlook for Renovations in 2023? Experts Weigh In
There's light at the end of the tunnel for renovators and builders this year, but patience and flexibility are key
Full Story
Awards
Sir David Alan Chipperfield Wins the 2023 Pritzker Prize
The English architect is known for honouring history and culture while creating timeless modern design
Full Story
Trade Shows
6 Surface Materials Your Clients Will Crave in 2023 and Beyond
Discover the top six innovative materials that were on display at this year’s Surface Design Show in London, UK
Full Story
After 46 years in the game you realise most clients defiantly don’t want to reveal their budget large or small, so what I do is make sure every single item including labour is revealed to the client before commencement if you don’t have an exact costing make sure you are covered,because it will come back to bite you if you dont.Get every stage signed off in writing by your client.Including extras before you start or supply them.
Certainly pays to be upfront as much as you can and invest in the planning stage not just for design but also for costing. I also think most customers need educating as to how much things cost and the labour involved.
We've been in business in Perth for 25 years and we've noticed particularly over the past 5 years that clients generally have little idea of cost when it comes to home renovation. The internet is plastered with amazing renovation ideas and "DYI" fixes to update and upgrade the home but in reality, renovation isn't cheap - and if its too cheap, its not being done right! We always listen to our clients ideas first, then offer suggestions if needed and wanted, then we ask what the budget is. I agree with Des Cass that most clients don't want to reveal their budget but being clear about what our quote includes and doesn't include and being honest about what our company offers in terms of quality, professionalism and practicality shows the client what is available when deciding on a contractor for their project . We don't always win (of course) but at least we know we've done the right thing by the client and kept our own integrity.