Ep 221: Why You’re Not Making Money on Furnishings (Even When You Think You Are)
Furnishings should be one of the most profitable parts of your interior design business—but for many designers, it feels like the exact opposite.
In this episode, Michelle pulls back the curtain on what’s really happening behind the scenes with furniture and procurement. From underpriced markups to disorganized systems and hidden time drains, she breaks down why your margins might look fine on paper… but still leave you feeling overwhelmed and underpaid.
If procurement feels like it’s running you instead of supporting your business, this conversation will help you rethink your pricing, your process, and your role as a designer.
What You’ll Learn
Why furnishings are not a transaction—but a full process
The biggest mistake designers make when pricing furniture
What’s actually included in procurement (hint: it’s a LOT more than you think)
Why a 30% markup is outdated—and what to consider instead
How underpricing happens gradually (even when you think you’re doing it right)
The hidden cost of disorganized systems and double entry
Why raising your markup alone won’t fix profitability
How to shift from “order taker” to trusted expert
The power of presenting a complete design vs. individual pieces
Two common patterns designers fall into (and how to break them)
Key Takeaways
1. Procurement is a Process, Not a Line Item
Sourcing, quoting, ordering, tracking, receiving, managing damages, and client communication—procurement includes far more than just buying furniture.
2. Your Markup Must Reflect Reality
If you’re still using cost-plus 30%, you’re likely undercharging. Your pricing should account for your time, expertise, and responsibility—not just the product.
3. Disorganization is Expensive
Spreadsheets, inbox tracking, and disconnected systems create inefficiencies, errors, and unnecessary labor costs.
4. You’re Not a Personal Shopper
Presenting one item at a time positions you as a vendor. Presenting a full design positions you as the expert.
5. Profit Comes from Structure + Pricing
You can’t fix a broken process with higher prices. Real profitability happens when your systems and pricing work together.
Signs Your Procurement Process Needs Work
You feel constantly “on” managing orders and updates
You’re tracking items in your inbox, head, or spreadsheets
Projects feel chaotic behind the scenes
Your profit doesn’t match the effort you’re putting in
You avoid furnishings altogether to reduce stress
Michelle’s Perspective
There’s no single “right” pricing model—but there is a wrong one:
Any structure that doesn’t properly compensate you for your time, energy, and responsibilityMinimum suggested markup on wholesale furnishings: 75%+
Procurement, when structured correctly, becomes a scalable and repeatable profit center
Tools & Resources Mentioned
Profit Mixer – A project management and financial system designed specifically for interior designers
Combines procurement tracking + financial data
Eliminates double entry between systems
Provides real-time visibility into project profitability
16-Step Project Management Framework
Michelle’s complete process from client inquiry to project completion
Coaching Options
VIP Intensives
90-Day Advisory
Learn more at: thedesignbakehouse.com/coaching
Coming Next Week
Michelle shares a special panel conversation from High Point Market on:
Hiring for Profit (Not Just Growth)
You’ll learn:
What it actually costs to hire
How to know if a hire supports revenue
Lessons learned (the hard way) from experienced design firm owners
Transcript:
Michelle Lynne (00:56)
Hello my friends and welcome back to Design for the Creative Mind. The podcast where we talk about the business side of interior design. Not just the pretty part, but what it actually takes to build a design firm that works, that runs, and that supports your life instead of consuming it. Right now we're deep into a series where I've been pulling back the curtain on the business of design one layer at a time.
Specifically, we've talked about the money that quietly leaks from your process, why designers feel busy but not profitable, client red flags, the sales process, and last week, we talked about construction pricing. Today, I wanna talk to you about furnishings. But really, I wanna talk about furnishings and procurement together because you can't have one conversation without the other, in my humble opinion. And I think that's exactly where a lot of designers get tripped up.
They think about the furniture, they think about the markup and they stop there. like, okay, I'm not gonna make this feel like comfortable and tidy. I think if you've been around for any length of time, you know that my job in my opinion is to challenge you, to tell you the truth, to be vulnerable and honest, but this procurement is one of the areas and furniture, procurement and furniture.
is one of the areas where the numbers can look fine on paper, like you see the margin that you're making, but the reality underneath it feels heavy and constant. So if you've ever felt like procurement is running you and you're like, I know I'm supposed to be selling furniture, but this is killing me.
then stick around, okay? Because this episode is gonna land.
So let's go back a little bit. When I first started my business, like way back in 1902, it was really, it was 2008. 2010 is when I went full-time into this gig. And 2013 is when I really pivoted out of home staging and into the interior design business. Okay. But I had no idea what I was doing when it came to procurement for design. I didn't understand.
wholesale per se or the trade accounts, I didn't realize that I was stepping into the role of a retailer for my clients and that I was supposed to be buying at one price and selling at another and that the margin in between was part of my how my business was supposed to work. So what I was doing instead, you guys might find this a little bit familiar back in back in your early days or maybe now.
maybe now depending on where you are in the business. And there's no judgment here for the record because I was out there trying to get clients sales at Pottery Barn, okay? So that I can get my quote unquote designer discount from Pottery Barn or gosh, I don't even remember where else I was shopping other than maybe like Home Goods, okay? There was no real margin in these places that I was shopping.
And there was no expertise required to find this furniture. At the time, I thought I was being resourceful. seriously, I'm not being self-deprecating. I was doing the best I could with what I had, right? That's what we do. That is what we do. And this is where a lot of designers start. You come in with this incredible design skill. Okay, but the business infrastructure, the pricing, the procurement, the processes, the services you offer.
how you implement your projects. That's the part that nobody teaches you. You figure it out as you go.
Now, when I was trying to figure all of this out and I was trying to write my processes out, trying to put them in some sort of ⁓ a navigatable order, and one thing that was instinctive to me early on is that if I'm managing this procurement process, I'm charging for it, right? Because I'm doing the work, I'm responsible for the outcome, I'm dealing with the headaches. So yeah, I'm gonna charge for it. Ignorance is bliss, y'all.
because I started talking to other designers and hearing things like, what? You can't charge for that separately. That's what your markup is for. Or build it, that should be in your design fee. And I remember thinking, what? Wait, what? What? Which is it? Because my instincts are telling me one thing, but the industry is telling me another.
So y'all, kept it. I kept a procurement fee attached to my services and a client has never questioned it. So here's what I've learned over time is that there's not one right way. Okay? You wanna work and wrap it into your markup, rock on with your bad self, but I believe that there is a wrong way and the wrong way is that any structure that requires a significant amount of your time, your energy and your responsibility,
and it doesn't compensate you properly for any of it. Like y'all, that is the wrong way, regardless of how it's packaged or what anyone told you it should be called.
So let's talk about what's... So let's...
I want to lay this out. That's what I'm trying to say. I want to lay out what's happening inside furnishings and procurement because I think that things might click for you from here because most designers think of furniture as a transaction, right? You source something, you present it to the client, you mark it up and you collect the money. It's a clean loop, but it's not because furnishings are not just a transaction. They are a process. What I mean by this is that
The process includes sourcing, not just shopping because you know your vendors. Okay, you know your vendors. You know the lead time. You know what's actually in stock versus just logging onto pottery barn.com and seeing what's on a website. This knowledge and the relationships that you have built or that you are building.
is what you apply every single time you sit down to design.
Then...
There's quoting, building the proposals, making sure the pricing is accurate before anything goes to a client. And if you've ever had a vendor come back and say, actually, that price changed, you know that that step alone can cascade into a lot of follow-up work. Then there's placing of the orders, the purchase orders, the deposits, the vendor coordination, the documentation.
Y'all, I still have some vendors that are on a fax machine. so it's not always just like put something in the cart and check out. And let's talk about if there's something custom. One wrong skew on a custom order can mean weeks of delay and an unhappy client.
And then imagine you have multiple projects. You have tracking across multiple vendors, multiple projects all at once. Like, you know, that's a job in itself. Receiving, inspecting, noting the damage before a driver leaves, so you have documentation. All of this is coordinating with your receiver, so they understand what your expectations are. And then when something does arrive damaged,
You're filing the claim, communicating with the vendor, communicating with the receiver to ship it back. You're managing the client's expectations while a replacement is figured out.
All while an install date might be in jeopardy. And then running alongside every single of these steps is the client communication, the emails, the updates, the reassurances when timelines shift.
Okay, and if you're navigating this in a concierge level because it's full service interior design, you're picking and choosing what you're sharing with the client and what you're handling behind the scenes, making everything look and feel seamless for them.
So when someone tells me I make money on furniture, like rock on, I'm so glad that you're doing that and you're not just shopping at Pottery Barn and getting that 20 % discount. You're getting vendor pricing at wholesale. But what I wanna ask is like, okay, what are you accounting for? Because if you're only looking at the markup, the money that you're making based on the markup, you're not looking at the full picture.
Okay, let's talk about the markup.
If you are buying wholesale, if you're doing that whole cost plus 30 % that I know some of y'all are still doing, you're not making a living, You're barely covering the cost of the time it takes to manage the process. That is old school. So basically what you're doing is you are buying furniture and paying.
or you're buying furniture and basically, what did I just say? You're barely covering the cost of the time it takes to manage the process. I think that's pretty clear. So make a note of this. The minimum you should be marking up your wholesale furniture is 75%. That's the minimum. And I know that might make some of you uncomfortable, but here's the thing. It shouldn't, because if you listen to the episode where we talked through the sales process, you already know how to handle this.
We walk through how to educate your client on the fact that retailing furniture is one of your profit centers. Okay, that conversation happens early, it happens clearly, and it means that by the time you're presenting a proposal, this is not a surprise to anyone. Your client understands that you're functioning as their retailer. They understand this is how it works.
So stop dancing around the numbers, own it. You don't have to tell them 75%, okay? That's not gouging anybody. Like that's bare minimums. That's where I started when I was not comfortable. Okay, but it's the cost of your expertise, your relationships, your time and your responsibility to deliver a beautifully furnished room.
Now let's talk about where the financial picture actually breaks down. And this was relatively new to me. ⁓ I'd say a couple years ago.
Because even when designers are marking things up correctly, we often don't still have a clear view of what a project actually returned. Here's why. Most designers are running two separate systems side by side. They're using a project management tool, something like Studio Designer, Design Docs, Design Files, Ivy, By Howes. Like there's a whole bunch of them now. I don't know all of them. I don't know the ins and outs of them.
I'm just saying that this is what I've seen on the outside. And these tools are genuinely useful. Absolutely 100%. I've been on a couple of those myself. What they do is they let you enter item data in real time, right? You get the clipper, you put the picture there, you put the description for the client, you put the purchase price, you put your markup and the selling price to the client. Like all of this information lives in the system as you're working. It's fabulous.
But here's the problem. That project management software is not financial software. It was never meant to be. Okay, so all of that item data still has to be separately confirmed and entered into QuickBooks, which is where your accounting is stored. Okay, so it's entered into QuickBooks by your bookkeeper.
who is already taking what already exists in your project management system that you've entered and they are re-entering it on the accounting side so that your books are right. It's double entry and you're paying for it. I paid for it for years, I get it, okay? But in bookkeeping hours and time in the lag between when something happens in a project and when it shows up in your financials. So you're running two systems, you have two entries, two,
places for error and a financial picture that's always running just a little bit behind. Now that to me, like I get, I'm not as much as I'd like to be on it. Honestly, I'm going to throw myself under the bus here. I'm not, I actually I am. I'm always running a little bit behind with my financial picture. So that part doesn't bug me. What bugs me is that I was paying a bookkeeper to enter in the data that I had already entered into my project management software.
That's when I had a project management software. Let me tell you a story because I think this is gonna sound familiar to a lot of you, okay? Especially if you've been in the industry for a while. Back in the day, it was Debbie who's still with ML Interiors Group, Megan, who's not, and myself, okay? And we were managing procurement the way a lot of designers manage it when they have no...
when they don't know what to do, okay? But they're in growth mode and they're running fast. Okay, so the three of us, we were tracking orders in our heads, in our inboxes, in conversations, our weekly meetings. Like, did this ship? Oh, I think so. Did we get a confirmation? Hold on, let me check. Okay, what about the dining chairs? Were those the ones that were back-ordered? Does that sound familiar? Okay, it was like an on and on and on. We were running around like maniacs.
trying to keep up with what had shipped, what had been received, what was damaged, what was still outstanding. And at some point I sat down and I was like, I cannot do this anymore. So I built a spreadsheet because I am a spreadsheet nerd, okay? And that felt like the answer. Like get it all in one place, track it, stay on top of it, color code it, because I am also a designer. Okay. And I thought I was organized, but for a while I was, it helped. But the spreadsheet got clunky really fast.
Okay, especially because I was the one who understood spreadsheets. Megan had no idea how to run a spreadsheet. Debbie was, she'll say this to you still, she hated spreadsheets. Okay, so it got big and it got unwieldy and there were too many projects running at once for a spreadsheet or at least a spreadsheet with my capabilities to hold it all cleanly. And I was like, son of a monkey, like there has to be a better way. There has to be a software built for this. So I...
found out about Studio, now it's Studio Designer, it was called Studio Webware at the time. So if you've been around long enough, you might remember this was way back when. It was one of the earlier tools and it was built specifically for interior design, project management and procurement. I'm so excited. It did help, it got us organized. Hallelujah. But this early software, it was clunky. It was not intuitive.
And especially if you're a designer because you're right brained, like you had to fight a little bit to make it work. But the experience like the chaos before the spreadsheet and the spreadsheet that stopped working, the software that was still better.
It gave me a picture of what this process actually needs.
And so.
It's led me to, I've white labeled something that works the way a design firm actually works. It's called Profit Mixer. I'll tell you more about that in just a little bit. But it has changed my confidence as the business owner, as the CEO and CFO, Chief Financial Officer, as well as a designer, and my team loves it as well. But before we get to that, I want to talk about presentation, okay?
because there's a mindset piece here that does affect everything else downstream.
I was recently at an event and talking to some designers who are still presenting furnishings one piece at a time. Okay, going back and forth through multiple rounds before anything gets approved. It's like your personal shopper. Okay. And I want to say this clearly, you are not a sofa salesperson, babe. You are not bringing your client one piece, getting feedback, going away, coming back with another piece. Okay, that's exhausting.
Because then you make a purchase and then you find a better solution that's a part of the room, but you know the design domino effect, you change one thing and sometimes it's like, everything else doesn't work.
But in addition to that, this signals quietly, but it signals something about how you see your own role.
You are a designer. You are delivering your vision. When you present your design, you present the room, the full picture. No components for your clients to mix and match. This isn't Geranimals. It's a design. It's your design. And when you make that shift, it changes the entire dynamic of the client relationship. It moves you out of the role of vendor.
and into the role of expert. And clients respond to that confidence. Remember, professionals hire professionals. They trust the confidence, they're less likely to second guess individual pieces when they're looking at the whole and they can see these pieces in place. Now, at ML Interiors Group, we itemize. And it's not because it's the only way. I know other very successful designers that will present the entire
⁓ room total, okay? But over time, I've learned this is what our clients prefer. So it's not any harder for us. It gives the client clarity, it reduces second guessing on the back end, it has removed variability from our process, we make the selections, we build the proposal, and we present the entire design fully.
Options at every turn creates work for us and the client. So I'm going to say pick a structure and commit to it. Because when you're adjusting your approach for every client, you're making your business harder to run. Consistency, y'all. Consistency is what makes everything easier for you, your team, your clients. OK, but going back to where we were talking about this earlier.
is that when you're in a system...
and you're presenting when you're in a project management system and you can take each piece and enter it into your system and provide the markup.
Okay, designers don't intentionally under price furnitures. It happens gradually. And what I mean by this is that you take on this project and procurement seems manageable, right? The proposal gets approved, but then a lead time comes in longer than expected. A custom fabric is backordered.
An item arrives damaged. Your client needs reassurance. And none of these individual moments feel catastrophic, right? Each one is just a part of the job and we're just kind of rolling with it. But together, across a full project or multiple projects, this is like a constant drain on your time and your energy that your pricing never accounted for.
So the two patterns, see which one sounds familiar to you, is that we either undercharge and we overwork and we absorb the extra time. Okay, we had an episode about that recently. You tell yourself, this is just what the job requires. And you keep feeling like there's not enough leftover at the end. Okay, or the second is avoiding furnishings and procurement altogether. So all you're doing is the design work.
to escape the complexity. And I understand that impulse, but y'all are leaving a significant amount of money on the table. And it's not that procurement's all that difficult. It's the process that you need to implement in order to navigate and be highly profitable selling this furniture. Okay?
When procurement is structured properly, when your furniture is priced correctly and you're charging for procurement, you're running this through a clear system and your team understands their roles. And the team could just be you. OK, the team could be, OK, I'm designer today, I'm procurement tomorrow. I'm installer the next day. Like, I get it. When it's just you, you're wearing multiple roles. So when I say team.
Maybe your poly procurement, your Debbie designer, okay, your Ingrid installer all under the same hat. Okay, but I digress. I'm cracking myself up. But what I'm saying is that when your team knows their roles, it becomes one of the most scalable parts of your business. Like this really supports your revenue. It creates recurring work inside existing client relationships.
And doing this properly compounds in a way that design fees alone just don't. But you have to build it intentionally. Raising your markup alone will not fix it. Does it help? Hell yeah. We're up to 100 % or more sometimes. Okay, but if the process is disorganized, if communication is reactive, if you're still keeping some of this in your head or on a spreadsheet,
or if you're in a system that's really clunky, there's just no real system for tracking.
When you do raise your markup, it just means you're charging more for the same chaos. So it makes a little bit more palatable for a short period of time. Okay. But this is not just a pricing conversation. It's a structure conversation.
So both of these, pricing and the structure, these conversations have to happen together. Because additionally, if you're charging more money, but the client or yourself is feeling the pain, it's not sustainable. So this is the kind of work that we do together inside my VIP intensives or my 90 day advisory. We're working together one-on-one and we're not talking just mindset or motivation, babe. Okay, we're looking at your actual numbers, your actual process, your actual structure.
finding out where the time is going and where the gaps are.
And once we identify that, then we build something better. And that's if that's where you are, you can find information on working together at the design bakehouse.com slash coaching. OK, because furniture should not drain you. It should not feel like a constant fire to manage.
systems don't break down, people break down. So your system should be one that runs, that delivers, and that supports your revenue and your team and your clients, and that you trust because it is built intentionally. When that shift happens, I said shift, by the way, when that shift happens, when procurement goes from something that's happening to you,
to something that you've built and you control, like everything changes. The business feels lighter, the work feels clearer. You have more, like more energy, you're more energized to be creative. And you're moving through these projects with a confidence that's different from what you had before.
I want that for you. It's changed everything in my business and in hundreds of other designers that I've worked with. You just put this process in place across your business. It's my love language, process, process, process. So next week, let's talk about next week. It's a special, special episode and one that I've been looking forward to sharing with you for a little while.
Last fall, I had the privilege of moderating a panel at High Point Market with a group of women who were sharp, experienced, and completely candid about what it actually takes to build and run a design firm. The conversation in that room was just one of those that you don't want to end. And so I was able to bring them back together recently right here on the podcast to talk about hiring for profit, not just for scale.
Because hiring is one of those topics that sounds straightforward until you're in it, right? And then it gets complicated fast. So we're going to get into what it actually costs to bring someone on, how to think about whether a hire is gonna support your revenue or strain it, and what these brilliant women have learned, sometimes the hard way, about building a team that actually works. So you're not gonna wanna miss this one. ⁓ wait, but before I let you go, everything that we talked about today,
the item level pricing, the order tracking, the double entry problem. Y'all, I've got a tool that is built specifically to solve it. I want to share it with you. It's called Profit Mixer. Okay, it's built on an established project management and financial platform built by an accountant and a designer specifically for our industry. Okay, this is not a platform that I just cobbled together.
We've got a real development team, real infrastructure, real support. What I did is I took this existing platform and I customized it around the way that I run projects, the way I teach projects. So when you log in, it already speaks the language of what I teach. It used to be only available to interior designers that I have been working with. OK, but here's what makes it different from the other tools that you might already be using.
You know that your project management software is good for tracking item detail in real time, right? Purchase price, markup, client selling price, all of that. But like I mentioned in the episode, it's not financial software. So it means that your bookkeeper is still gonna have to go into QuickBooks and confirm and reenter what you've already logged on the project side. It's double entry. It's called Profit Mixer. Pulls from QuickBooks, okay?
Push the data in there, it pulls it. You're sending invoices through QuickBooks. QuickBooks stays your financial source of truth. The profit mixer surfaces that data inside your dashboards automatically so you can run reports. So your bookkeeper just does their job once. Okay, I'm not paying for the same work twice. That in itself makes me do a little happy dance. I don't like paying for anything twice.
On the project side, every piece that you source, you enter the purchase price, you enter the selling price into the client side right there. You assign a name that's project facing for the item. You get the information in there for the vendor on the part that the client doesn't see. Okay, you know exactly where you stand on every item while the project's running. But there's this really cool procurement tracking, okay, where every order has a status.
You can see what's been received, what's in transit, what's backordered, what's pending. If something's delayed, it's visible. If something arrives damaged, the claim is documented right there. Nobody's holding their information in their inbox or in a spreadsheet. It lives in one place. Okay. So that combination is really cool. You've got the item level financial data and real-time procurement tracking inside the system. Okay. So in that respect, it feels like you're running procurement instead of procurement running you.
And like I mentioned up until now, Profit Mixer has been exclusively available inside the Interior Design Business Bakery or if you purchase the key ingredients. It was built for designers already inside my methodology. OK, and for them it was the natural next step. But I've watched what happens when the right structure and the right tool works together. And that's not something that should stay behind a door, so I've opened it up, especially for you here on my podcast.
Like you understand a lot of my systems and processes, even if you've never hired me to teach you in one form or another. OK, so it's 98 bucks a month up to 10 users. No, no, no contracts. Now, here's here's what makes this really special. My 16 step project management framework. Is included in it. OK, y'all, this is the full process from the initial client qualifying call all the way through.
your all the way through your services, your pricing, the deliverables, like all 16 steps. We call it the 16 steps of sanity at ML interiors group. Okay, really it could probably be 13 steps, but 16 steps is what it's kind of grown into. But it's the full process from initial client call through the punch list deliverables. So you have the, you've got this operational structure
inside your project management software as the tool to run it. So if you want to go even further, if you're ready to hand off procurement entirely, Profit Mixer gives you access to our procurement services. Okay, that's Debbie, my Debbie that's been with me for 11, maybe 12 years. Okay, she's living her best life up in Michigan. Okay, but she's up there and our team placing your orders.
managing vendor communication, tracking shipments, handling claims. Okay, this way you can be the designer and the CEO and let someone else run these logistics. So the link is in the show notes.
I'll see you next week. Have a great day. Thanks for being here.
