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  • Diane Fernandes

Freelance Guide Interior Design


Before you jump in to our four-step freelance guide, take a moment to watch me explain each step and the reason we created this guide for you! WATCH NOW!



BEFORE YOU START

There are many things need to be considered when starting your freelance career. The very first thing is the type of business entity that will be used. Depending on your long-term goals, it is good to review each business type and its distinctive benefits and disadvantages.

Business Structure

The most common entities are: sole trader; partnership; company; and trust. Sole trader is the business structure chosen by most freelancers; this structure is where the business has no separate legal existence from its owner. As a sole trader, you'll be responsible for the liabilities of your business, including your tax with GST.

Every business entity (whether a sole trader, partnership, company or trust) must apply for an Australian Business Number (ABN). An ABN is a unique 11-digit number that identifies your business to the government and community. An ABN doesn't replace your tax file number, but it is used for various tax and business purposes.

An ABN is free - you can apply for one here.

You must also consider if you will need to register for Goods and Services Tax (GST). If you estimate the total income you will make as a freelancer will exceed $75,000 per year, you must register for GST.

You should always seek professional advice from your accountant or lawyer before making any decisions about registering a business, choosing your business structure and your tax obligations.

STEP ONE

As a designer working full-time, you may have the opportunity to do some freelance work, earning you extra cash or the ability to pursue a passion project that you don't get to tackle in your everyday job.


In setting up your first side hustle, you will need to determine who you'd be providing design services to. Both individuals and businesses offer designers the opportunity to do project-based work and, in turn, could serve as your 'client'.

Individual

Regardless of whether the individual that has approached you directly is a friend, family member or acquaintance, you must ensure that you commence the project with professionalism and are very clear on the expectation and deliverables. This is a business transaction, after all.

Business

If another designer approaches you, first you must ensure that doing work with them doesn't create a conflict of interest with your full-time employer.

Agreement/Proposal

After consultation with the 'client', you need to draw up an agreement that will serve as a contract. This agreement can be as simple as a fee proposal stipulating your terms and conditions, or terms via email correspondence.

Either way, keep a record of everything in writing. Make sure you include the acceptance of the terms even via email or signature on the proposal.

When engaging in freelance work, you need to be aware of your responsibility in regard to insurance. If you are working for another designer, be clear if their insurance covers you or not. If you are dealing with the client directly, you will need your own cover.

What insurance do I need as a freelancer?

Professional Indemnity Insurance protects a professional if sued for a financial loss resulting from their advice and/or professional services. Anyone who gives another person information and/or services of a skilful nature based on an established discipline is regarded as a professional.

If your 'client' is a designer, you must confirm you are covered under their insurance. But be aware - if drawings and specifications are issued in your name - you will be liable. There are some key exposures for interior designers you need to take into consideration. These include, but are not limited to:

  • Failure to deliver in accordance with the client's instructions

  • Incorrect preparation of plans and specifications

  • Incorrect interpretation of client’s needs

  • Failure to comply with government regulations, such as for people with disabilities, environmental, e.g. impact on ventilation and waste disposal, flammability of fabrics and materials

  • Misleading, incompetent or inappropriate conduct

  • Activities that exceed the designer's authority, e.g. removing a load-bearing wall that leads to a building collapse

  • Miscommunication regarding the responsibility for contracting out certain parts of the design to other professionals such as architects and/or construction consultants

  • All additional costs outside of the agreement with the client

Insurance Companies

Some companies/brokers offer insurance specifically for interior designers.

Here is a couple:

  • The DIA has a new insurance called planned cover, for interior designers

  • The HIA has developed a cover specifically to address the common needs and risks faced by design professionals

  • Insurance House caters to professionals across all areas of interior design and consulting, including office design, interior home design, outdoor spaces or staging for real estate spaces


STEP TWO

The second step is to clarify and outline the detailed scope of services you intend to provide and the work you will be responsible for delivering, in your proposal.


This outline will assist you in working out your pricing and fee. Below is a scope of services example that you can amend according to each individual project requirement.

Research brief development for your proposal

  • Establish the scope of work required, program, budget and brief

  • Agree on critical success factors for the project

  • Inspect and analyse the site, it’s locality and surrounds

  • Identify safety issues and code requirements

Preliminary design- schematic

  • Perform a site audit and investigation to determine the current state of the site and existing services

  • Verify key site dimensions and draft CAD building plans as necessary

  • Present schematic/conceptual design for the space, including all finishes and features

  • Client consultation, discussion, feedback, preliminary approval from the client

Detailed design

  • Integrate the development of secondary consultant design work into the planning and design of the project through meeting with consultants, suppliers and contractors

  • Preparation and coordination of final documentation package required to obtain costs and construct the project

Execution

  • Evaluate and sign-off prototypes and samples to set standards of materials and workmanship for the project

  • Procurement of furniture

  • Periodic site visits as agreed by the client during the construction period

  • Report any deviations by the builder from the documentation

  • Respond to trade contractor and /or construction manager queries

  • Finalise all furniture delivery to site and coordination of styling


STEP THREE

There are three main ways to price your projects as an interior designer. These are hourly rate, fixed lump-sum fee or percentage of the project value.

If you're new to freelance work, we suggest you start working on an hourly rate, or a fixed lump-sum fee.


Hourly Rate Structure

As the scope of each project will vary, you must estimate the amount of time required to carry out each task of the project. Then assign cost per hour to your services or skill level. We suggest you reference the DIA Guidelines, which outline the industry hourly consulting fees and are summarised by the level of responsibility; this ranges from $45-500 per hour.

Then, as a freelancer, to ensure your costs are covered and you make a profit, you must take your chosen hourly rate then:

  • Add a minimum 30% to cover business cost including tax, expenses and profit

  • Charge for every minute of time spent on the project, including travel, emails and phone calls

Fee Breakdown Example

The design fee is based on an hourly rate of $X per hour. Cost is an estimate of the time required for the concept design and final design package and is broken down as follows:

If additional time is required, the client will be notified, and sign-off will be sought before continuing.

Design Briefing XX hrs = $0.00

Concept Design XX hrs = $0.00

Final Package XX hrs = $0.00

Total XX hrs @$XX per hr = $0.00 ex. GST.

When you are outlining your scope of work, you must be clear on what your hourly rate inclusions and exclusions are. These could include, but are not limited to:


Exclusion (Items not included in the services or the associated fees)

  • Costs associated with the purchase of images for graphics

  • 3D drawings

  • Interstate travel

  • Construction management services

  • Payments for all other consultants required to complete the project (mechanical, hydraulic,etc.)

  • Development application fees

  • Statutory charges

  • Quantity Surveyor or Cost Consultant fees

  • Significant alteration to the scope of work

  • Building costs

Inclusions (Items included in the services or the associated fees)

  • Existing plan as built on-site to date, including associated elevations

  • Concept boards

  • Finishes/Materials boards

  • Tender/Construction drawings, including any associated construction detailing (usually provided in PDF format and printed to scale)

  • Furniture plan

  • Reflected ceiling plan

  • Electrical plan

  • Finishes plan

  • Hydraulics plan

  • Elevation/Sections

  • Construction detailing

  • Joinery plan, including joinery details

  • FF&E schedules (all furniture, finishes-including interior/exterior colour scheme, lighting, fixtures and equipment, etc.)

  • As built drawings- as built on-site at completion


STEP FOUR

Your payment schedule defines the dates at which invoices will be issued and when payments will be expected.

Ensure you outline your expected stages of invoices -include dates where possible.


Example Payment Schedule

Note: invoices will be issued at the end of each stage of works as outlined in the project service scope.


THE NEXT STEP

Starting a creative business is often fuelled by the desire for freedom; whether it be artistic, financial or for greater opportunity.

But to build a dream career, you need to ensure your business is headed in the right direction from the very beginning.

Every business, no matter the size, needs a sound understanding of where they are, and a guide for where they want to go. There are several essential parts to a business plan, but before you even get started, it is important to gain clarity on your "big" idea and understand your audience.

My coaching and workshops guide you through the steps to help gain clarity on your business vision before you start developing a solid business plan.

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