How to Track & Detail Hourly Interior Design Services On Your Invoices

Jul 21

If you charge hourly for your interior design services, you’ll need to track your time and create invoices that outline the services performed and how many hours those services took. Sounds simple, but determining how to list design services on an ho

If you charge hourly for the interior design services you provide, you’ll need to track your time and create invoices that outline the services performed and how many hours those services took. Sounds simple, but determining how to list design services provided on an hourly invoice can be a bit perplexing.

One reason designers prefer flat fees (rather than hourly billing) is that flat fee invoicing is much simpler and more straight forward and doesn’t require you to tally up hours, guesstimate on what you missed, or, feel like “I can’t let a client know it took me 12 hours to find that side table” so then you delete a few hours. But on the other hand, hourly billing can be easier because it doesn’t require you to prepare an estimate of time allocations in advance of the project to come up with the flat fee rate to begin with. Download this guide for a full list of pros and cons of various billing methods for interior design services, including hourly, flat fee, and others.

If you ARE billing hourly, and many interior designers do, keep in mind that no one wants to receive an invoice that says:

FIFTY HOURS OF DESIGN SERVICES -$7500

It’s human nature for clients to want a more comprehensive and descriptive accounting of what they are being charged for (which again, could be reason enough to move to flat fee and simply prepare a detailed scope of work). So for hourly billing, how do you let clients know what you did without inviting them to put a microscope on your design process or business practices? I recommend a brief standard description which generally encompasses what type of work was done during the billed hours.

WHAT did you do for those 50 hours that you are billing for???? That is what an hourly client really wants to know.

So how DO you list services performed on an hourly billing invoice?

Both of the examples below are poor descriptions for hourly billing:

2.5 hours to track an order, phone call that wasn’t returned, and then another call had to be placed, which wasn’t returned until the next day, and then the person didn’t really have the answer anyway, so we had to start over - $375.00

2.5 hours product issue - $375.00

No client would be happy paying for such a vague (and seemingly unproductive) expenditure of time.

And, talk about opening up the door for push back from the client like “Why’d you spend 2.5 hours tracking orders? You don’t need to track orders going forward. Not worth it to me.” OR, “What was the product issue? Why did it take you 2.5 hours? Who’s fault is it?”

Yeah, that’s not a good way to spend all your “spare” time in your business.

So what to do instead?

We suggest using the industry standard design phases as a framework for describing interior design tasks. These design phases are commonplace designations for design process activities that are used universally across disciplines: interior design, architecture, engineering, graphic design. They are used throughout the design industry as a means of describing what level of design work a project is at.

Additionally, these five design phases (and a sixth for the purpose of designating non-design activities such as business administration) DO provide a good framework for describing tasks performed on an hourly invoice that are easy for your team to book time to and are easy for your clients to understand.

So for hourly billing, the way you track and list the services you provide on your hourly invoices should, in general, align with the industry standard design phases (as defined by CIDQ):

01 | Programming (information gathering; pre-design efforts; initial consultations; taking measurements; administering questionnaires; analysis of the site and the client’s goals; identifying client preferences and resources; identifying reuse of items and features; establishing project goals and timelines)

02 | Schematic design (establishing a conceptual direction and design intent; exploring parameters; developing concepts; initial space planning; initial design exploration; concept sketches; initial selections of furnishings and materials)

03 | Design development (refinement of materials and furnishings; sourcing all materials, furnishings, and finishes; all materials and finishes selected, presented, and approved; detailing of any custom component completed; final space plan agreed to; client sign-off and approval)

04 | Construction documentation (completing any documentation drawings on CAD or other programs; procurement and purchase orders; documentation of materials selected and where/how they are to be installed)

05 | Construction administration (construction phase - if there is construction; monitoring final details; dealing with shipping and deliveries, installation; answering any questions or making site visits during construction; punch lists; final reveal)

The above are the industry-wide phases of any design project. Additionally, for the purpose of invoicing, you will want to include all administrative tasks that you or your team complete to advance and finalize the project — or project management.

06 | Project management & meetings (during all design phases, this involves your internal record-keeping tasks; invoicing; communication and coordination with trades and vendors; meetings and phone calls with clients, etc.).

So, IN GENERAL, it is good practice to align billing descriptions with these defined interior design responsibilities.

However, since the general public does not know what “programming” or “construction administration” means, just use your own terminology to make what you are including on invoices understood. Plain, simple language is best. Remember, the client just wants to know what they are being billed for.

And, make sure to include on your invoices what your payment terms are. This should also be included in your contract. Do you expect payment within a week of receipt? Within a month of receipt? Immediately upon receipt of invoice? What payment means do you accept? Do you charge a late fee for payments not received within your expected timeline? What happens if they don’t pay after a certain number of days?

And, be sure to set a regular cadence for sending hourly invoices. Monthly is the most common. Just be sure to eliminate any surprise factor and send it on the same day of each month. Choose the 1st, the 15th, the last day of the month - whatever works best for you. And never ever skip months, even if it’s only just a few hours.

Make your invoicing understandable, straight-forward, and consistent, and you’ll be less likely to incur late payments, receive client push-back, or be subject to complaints and litigation. Transparency and clarity in billing is all part of the superior client experience you provide.