126. If I Wanted to 10X My Design Firm, Here’s Where I’d Start

0:00If I told you I wanted to 10X the revenue of my interior design firm, you might expect this episode to be about money. Raise your rates, book bigger projects, add another revenue stream, or even sell more. You're hearing it from other coaches in the marketplace, but I know that's why you stop and you listen to this podcast, because this is not where I would start. If I took most design firms and handed them 10 times the business tomorrow, I don't think they could make them 10 times more successful. I think it might actually break them. If you had 10 times the clients, 10 times the purchasing, 10 times the emails, and 10 times the decisions take that 10 times the opportunities for something to fall through the cracks. If I wanted to 10X my revenue, my first question would not be how do I make more money? Instead, I would be asking what would have to become true about this business for it to responsibly handle 10 times the revenue? That is the conversation that we are having today. Because real growth does not start when you figure out how to sell more folks.

1:01It starts when you build a business capable of actually becoming more. Welcome to Success by Design, where I give you the real talk and a big reality check about you needing to stop treating your business like a hobby. Let's turn it into a profit generating machine, all while doing it in a way that works for your life. I'm Katie Decker-Eirerson, and I am taking what I learned by building a multi-million dollar coast-to-coast design business, and sharing it with you right here. If you are wanting to generate more profit, and not be burnt out, and possibly even have a dream design business, you are in the right place. Let's say you're running a $250,000 design firm. Maybe it's $750,000, maybe you've crossed a million or five million or even 10 million. What two designers typically do next? They attack the top line. It's new website, more marketing, more social media, bigger projects, more services, another hire, and plenty of more yeses. And revenue does start growing, but the business

2:02underneath it has not changed. You're still approving every purchase order and answering every client question, reviewing every presentation, checking invoices, and solving every installation problem. And still remembering that Mrs. Misfabric is backordered. Yeah, you're still the rainmaker in your business, which is incredibly stressful too when you're still trying to be the principal designer, creative director, purchasing department, client service department, and let's not forget quality control. You just have more business moving through the exact same bottleneck, and that bottleneck quite frankly is you. And this is where I just see designers getting into trouble. Revenue can grow faster than the infrastructure supporting it, and you can have your biggest revenue year ever, and your worst operational year at the exact same time. So you're looking successful from the outside, and inside you're thinking, I just can't keep doing this. I'm dying. See, that's not scale. That is volume. And I'm going to tell you right now, they are not the same

3:03thing. In fact, for many designers, this is where the diagnosis goes extremely wrong. We tend to think I need more leads and wealthier clients, and I need to charge more or better yet, I need another designer in my business, or another revenue stream. And the answer to that is maybe you actually do, but all of those answers assume that the problem is revenue, and it actually may not be the case. Your real problem may be that the business cannot officially or efficiently convert more revenue into more profit. And if you've been listening to this podcast for any amount of time, you know, those are two separate things, but it can't do that without requiring a lot more of you. And so I want to ask you one simple question on today's episode. If I doubled your business tomorrow, what's going to break first? Is it procurement or client communication, bookkeeping or cash flow, design production, project management? Maybe it's your installations or even your team members or

4:03your calendar, or worst case of all you. Whatever answer you just gave me is probably more important than finding another client. Let's start with that constraint first, not just the revenue. If I wanted to 10X a design firm, I'm going to give you six things today that I would focus on first and foremost. And I'm going to tell you right now, making money is not number one. See, we're focusing on the solution before we ever start getting through the problems. We love saying as designers, I want a $5 million firm. Okay, great. But what does that actually look like? How many projects? What size projects? How much revenue is coming from your design fees versus procurement? And what gross margin do you need to produce? What do you want to actually take home at the end of the whole project? And what are employees require? What are you doing as the owner all day? And what kind of projects are no longer accepted? Because as you've heard me say, you have to say no, to say yes to the right project. See, $5 million and just saying I want to get there is

5:09not a strategy. That is the outcome you are looking for. There are plenty of ways to build a $5 million company. And I would not want to own all of them quite frankly. You could get there with the dozens of smaller projects or much tighter roster of large whole home projects or you could build around furnishings, furnishings, heavy work. Maybe you could create a highly selective luxury model with fewer clients and substantially larger project value. See, those are all very distinct and unique businesses. Before I multiply the revenue, I'm first going to design the company. We spend our lives designing spaces as designers and somehow we forget to design the business. All right, let's talk about number two. I want you to find the highest value version of what you already do well. This is where people get distracted and I need you to sit with this for just a minute. It is easy to assume 10X requires more offers. Maybe you launch design and start staging and create a

6:11course and sell some really cool bougie candles offer consultation. Add real estate. Okay, stop. Time out on all of that. Your biggest opportunity is probably not something new. It's probably just going deeper into something you're already extremely good at. How do you figure out what this is? All right, I want you to ask yourself, what is my firm unusually good at? Where do clients happily spend money with me and what produces the best margins? Not revenue, but actual profit. What types of projects repeatedly go really, really well and which clients keep coming back over and over again? What do people specifically seek out for us to solve? And then I want you to flip it on its head, and we're going to ask some opposite questions as well to drill down. What is taking an enormous amount of time, either logistically or emotionally, for very little return? You may not need more services. You may need fewer services delivered exceptionally well to a better value client.

7:16That is where maturity starts showing up in business. You understand what you are really good at. You know where the money is. You also know where the headaches are. I know which clients fit. And you stop needing every opportunity to become your opportunity. All right, number three, I want you to fix capacity before you create more demand. This is so important because everybody wants more demand, especially in the economy that we're seeing right now. But very few designers stop to evaluate their capacity. Imagine you get 10 increase this month. This is great, right? Now imagine you get 100. Can you respond? Can you qualify them and sell them and onboard them actually execute the work, procure everything, maintain quality? Because that is the business that can do 10x. Before I poured gasoline on marketing, you've got to build the engine to metabolize it. I would map out exactly how work is moving through my firm. And we have done this. A lead comes in. What happens? A client qualifies. What happens?

8:23The contract gets signed. What happens? The project launches, you know the question to ask. Design develops for Cureman Begins installation happens. Project closes after every single one of those phases, you should be able to answer the question. What happens? And if the answers to half of those questions is, well, Katie knows, go ask her. Then I have a huge problem in my design firm. Asking Sarah is also not a system. Neither is we always done it this way. So you need institutional knowledge, not tribal knowledge. All right, number four, you've got to remove the owner as the default answer. You cannot be it. And this is so incredibly critical. And one that I know, us type a highly precise creative people and love to think that we have all the pieces, but we don't. And you can't, if you want to grow, because if everything important eventually requires you, guess what? You've not built a scalable firm. It just can't hang on because you

9:26are the glue holding everything together. You build a company dependent on a very talented person. And that is you. You're amazing. You got this to where it is today. And let's not take away from that. But I'm going to give you a big caveat here. I would start paying really close attention to when someone says, I need to ask Katie, I need to get your approval. What would you do? See, that moment right there shows you where the business is depending on you. Then I want you to ask yourself, does this truly require my judgment? Or have I simply never taught someone else how to make this decision? So those are two very different things. And your creative vision may absolutely require your involvement. But let's get real here folks. Does free approval and scheduling a delivery and following up for deposit and handling a damaged item or sending off boarding instructions? You've sent 100 dimes. Yeah, I'm going to go out on a limb and say, probably not needing you. So scale means building rules and decision frameworks.

10:28If X happens, then why happens? If the expense is below this threshold, then proceed. If the client requests this, follow this policy. And if the product arrives damage, use this process. If the scope changes, here's what happens next. And see, that right there, those little nuggets, that is how you stop being the answer to every question without disappearing from your company. If your business feels stuck overwhelmed or harder to run than it should, chances are you're treating symptoms instead of solving the real problem. That's exactly what I created, my business health diagnostic. In this one on one session, we'll uncover the real constraint holding your business back, whether that's your finances, marketing, team, leadership, or your service model. You'll leave with clarity on what's actually slowing your growth, plus a personalized prescription for what to do next. If you're ready to stop guessing and start building a healthier business, head to fix my design biz with az.com and book your

11:30business health diagnostic today. All right, back to the show. All right, let's talk about number five. You've got to know your numbers, know your economics. Now it's taking us four other steps, but we're ready to talk money because I do not want more revenue. I want better revenue. Let's see a project produces a hundred thousand and project B produces 70,000. Most designers assume project A is a more valuable project, but not necessarily. What if project A required 400 labor hours, constant revisions, site visits, complicated procurement in six months of follow-up? All right, let's look at project B. It only required 120 hours, had clean procurement, a decisive client, and a much stronger margin. Which one do you want 10 of? That right there, that is the better question. You need to know what revenue actually costs you to produce.

12:30This is why I want you tracking. I want you knowing your gross margin by project, your labor hours by project, your revenue per employee, your design fee profitability, your procurement profitability, discounts, write-offs, unbuild hours, which you should not have, freight overruns, installation overruns, revisions outside of scope that you have not built for, average project value, repeat client revenue, and referral sources. And if that feels like a lot to you and you aren't even doing one of those things, we should talk because your business is running you, you are not running it. Most importantly, where are you generating activity in your company without generating enough profit, not revenue, but profit? Some revenue is expensive and you can absolutely grow yourself broke. All right, number six. Once you have this kneel down, you are ready to build the revenue engine. We are ready to talk about growth

13:32because there are really only a handful of levers we have in business to be able to pull. More qualified clients, higher value projects, more revenue per client, better pricing, more repeat business, more referrals, more capacity, and better conversion. And you do not necessarily need to improve all of them. Better yet, you need to identify which combination changes the economics of the company. What happens if average project value doubles? What happens if you eliminate the bottom 30% of projects consuming the most time? And what happens if 40% of your revenue becomes repeat clients? What happens if your close rate improves because your positioning just keeps getting stronger? And what happens if your procurement margin improves? See, what happens if you sell the next logical project to an existing client instead of constantly searching for a stranger like you were on a bad dating app? See, this is the one designers overlook constantly.

14:34The client whose powder bath you just completed may be exponentially more valuable than a brand new lead. This is why I teach in my coaching practice to my interior designers. We are hiring the client, not the project. See, they already know you. They trust you. They understand your process. They have experienced the result. That relationship right there, folks, that has huge economic value. Stop trading project completion, like relationship completion. No, it is much more like a Lego kit. You keep building peace by peace by peace. I get this requires a mindset shift because underneath this is a belief I'm still seeing constantly. Growth means doing more, more work, more clients, more employees, more hours, more offers. Again, time out and stop. The belief I want you to adapt and adopt in your thinking is growth means building leverage. This is what you need. You need

15:35to leverage your systems, your reputation, your expertise, your team, and even your past clients and vendor relationships. Also, you're pricing. You may not see that as a leverage point. It is a huge leverage point. Knowing that you are priced properly and the value you provide is so important. Leverage, everything that you know that works inside your firm because this is how sophisticated companies grow. They don't ask how much more the owner can personally accomplish this week. There is a hard ceiling on that strategy. You only have 24 hours in a day, which is why I'm constantly saying time is your most valuable asset. Don't throw it away. And you also have a finite amount of energy to spend in that 24 hours. You can only make so many good decisions. There is a reason why I typically do not email after 3 p.m. my time every single day. My brain is fried. I am out of words and praise God. I'm not saving lives out here. It can probably wait until tomorrow when I can have a more clear coherent thought. See, 10 times your personal effort is impossible.

16:4110 times your leverage is not. And this is the transition designer struggle with when you're moving from a successful designer to being a CEO. For years, you have been rewarded for that personal talent, your creativity, your hustle, your eye, your responsiveness, and all those beautiful relationships that you built. But the next level is going to require something completely different. Because as you hear me say, what got you here today is not going to get you where you want to be tomorrow. See, this requires building an organization that performs because of what you created, not only because of what you personally touched. I have a fun exercise for you this week. I called the 10x. And here's what I want you to do. Take your current revenue, multiply it by 10, and then I want you to sit down with yourself and have an honest conversation. What breaks first, what would I personally have to stop doing? What decisions currently live only in my head and which services would I absolutely not want 10 times more of? And that one matters.

17:42Which clients would I want 10 times more of? And what work produces the best combination of profit, ease, enjoyment, and client value? Where is the business unnecessarily customized? We don't think about that often as designers, which three systems would have to exist before this company could even double. I want rule would I actually play in the 10x business? And then I want you to ask yourself the biggest question of all, would I actually want the company I'm currently building if it became 10 times larger? Because scale magnifies everything. Good systems, good culture, profitable services, great clients, but it's also going to amplify by pricing poor boundaries, wheat contracts, client dependency or code dependency, depending on the designer, founder dependency, bad hiring and financial stoppiness all show up that exact same multiplier if you're at 10x. Expect 10x. The problems if you have a bad firm or 10x that reward if you have

18:44the right systems in place. See 10 times more of a broken model does not create a better company. It just creates a lot bigger broken company. So if I wanted to 10x my revenue, I'm going to be honest with you. I would not start by asking how do I make more money. I would ask what kind of business is capable of producing that kind of money? And then I'm going to get busy building that business. I would define the company I want. I would double down on that highest value work, fixture capacity before adding demand and remove yourself as the owner as the default decision maker. Understand your economics and then and only then would I aggressively build the revenue engine. This is the exact work I'm doing with my interior designers inside of success by design because most established designers do not have an information problem. You can google marketing strategies and listen to another pricing podcast and download another workflow. But the real question

19:45is what is actually preventing your business from getting to the next level or where you want it to be? Sometimes it is pricing, sometimes it's positioning and sometimes it's a wrong client mix. But sometimes we as owners are under utilizing our team. Maybe we hired before the infrastructure existed for them to step into. And while we have strong revenue, maybe we do really have weak margins. Sometimes you can think marketing is a problem when actually the real problem is conversion. And sometimes you can think you need more clients when the biggest growth strategy opportunity is sitting right inside the clients you already have on your roster. Very often the problem, the designer thinks she has is not actually the problem. This is my favorite piece or nugget to find when I'm working with my coaching clients. Usually we're looking at the surface level or they are and then we dive deep and figure out the root cause. What's really going on under the hood of your business? This is why I'm still actively running my design firm. I understand the payroll and client

20:46calls and team decisions and purchasing decisions, cash flows, vendors and mistakes. See, this is not theory that I'm providing you from the sidelines. I'm in it day and day out with you running a multi million dollar firm. This is about diagnosing the business you are running right now and helping you build the business you actually want to own because bigger is not the goal. Better truly is. And when the business gets better, the revenue finally has somewhere to go. If you've been saying I want to grow, but you do not actually know what needs to change first. This is the exact work I'm doing in my coaching practice. Not generic motivation, not 47 more things for you on your to-do list. We're talking about diagnosing strategy, priorities and prescribing actual solutions. If this resonates with you, I want you to head over to fixmydesignbiz.com. Again, that's fix my design

21:48biz with az.com. I offer you a 15 minute free diagnostic call where we drill down and was really going on in your business and how to get you where you want to be. Because remember, at the end of the day, your business should be working for you, not you working for it. Until next time, take care. That's your real talk for today. If you found this helpful and you are ready to truly move the needle in your design business, head over to fixmydesignbiz.com. And let's get started. That's fix my design biz with az.com. And if you want to stay connected, head over to my Instagram. It's success by design, underscore, coach, underscore podcast and give me a follow. Don't forget to mention you came from the podcast because I would love to meet you and I personally respond to every DM. Until next time, take care.