EP #24 | 5 Business Lessons I Learned the Hard Way

Welcome to the Designers Oasis podcast. I'm your host, Kate Bendewald, interior designer, mama, and CEO of a thriving interior design business, built on authentic word-of-mouth referrals. It wasn't that long ago that I stepped away from my corporate architecture job to build my own dream, one that would allow me more time with the people that I love, the ability to serve my clients at the highest level and to make a great living. It wasn't always easy, and I've made my share of mistakes along the way. Fast forward to today, and I've learned a thing or two. This podcast is for you - the inspired, creative, ambitious, and let's admit it,  occasionally overwhelmed interior designer who shares this dream of transforming lives by transforming homes. Join me and my guests each week as we walk through practical ways to build an interior design business you love, and help you transform your client's lives. You can do this. 

Welcome, welcome back to another designers Oasis episode. Thank you so much for spending part of your day with me. I am thrilled sort of to be talking about some of the mistakes I've made to date, we're talking about the five business lessons that I learned the hard way. So I've I'm going to be pulling back the curtain of some of those mistakes that I made early on that were really Holding, holding me back. So today we're gonna talk about failures, mistakes, maybe even some regrets. But my goal here is I want to peel away some of that perfectionism that runs rampant that we see on Instagram and the social media, they just say so the social media, like I'm twice my age, somebody stopped me. 

Okay, so today, we're going to shine a light on just a few of those mistakes. Because I want to normalize them, I want to shine a light on them. But also, if I can share some of my mistakes or lessons that I've learned, and it helps you keep from making those same mistakes. That would be pretty cool, too. So listen, mistakes aren't necessarily bad, though. Mistakes are growth indicators. Okay, I see that, again. Mistakes are growth indicators. Do you think Sara Blakely, who I looked at, by the way, has a net worth of 1.1 billion with a be net worth that she made on underwear? Do you think that she got to where she is today without ever making a mistake? I highly doubt it. 

So let's get into it. The first mistake that I want to talk about today was not investing in my business sooner. So I'm going to tell a story about the struggle that I had with sales calls. I was very, very, very early in my business. And I have never had any sales training or sales experience. I had design expertise. But I was starting on my own. And I had been talking about what I was doing and sharing with my friends, my network. And I was getting calls. And I was part of this Facebook group that was bringing a lot of interest, but I was losing people at the sales calls. And I could feel it, we'll call them discovery calls, because that's really what they were. I could feel how painful they were. I didn't know how to drive that conversation. I didn't know what the next steps were and they would just linger and you know, they were supposed to be a 20 minute call. But sometimes I find myself on the phone with somebody for 45 minutes. And it just, it was so painful for me to do those calls. And we haven't even gotten to you know what a consultation looked like or presenting a proposal. Just those discovery calls alone were just wretched. I'm sure for both parties. 

And so the very first sort of big investment that I made in my business was hiring a sales coach. And at the time, it was a lot of money for me, I want to say it was $4,000 for the program that I took. I mean, let's be honest today, that would still be a lot of money to invest. But I went to my, my husband, who was super supportive, and I was just like, I really want to do this. But this is a lot of money, what do you think, and I kind of explained the program to him, and I just adore him. He's such a, he's such a cheerleader. And he's like, Listen, if this is the, this is the sticking point, that thing that's keeping you from getting to the next level to converting clients, I think you should do it. And I didn't really trust in myself for the the process yet I was just still so green. And so I did it, I invested in this, this live course. And it was some of the best money that I've ever spent and what I learned in this course, and in this, this training was invaluable. And it's stuff that they still still rely on today. And it helped me to shift my mindset around selling. And it just felt explosive in my business. And there have been other times where an effect, I just did this recently with designers oasis. But in my design business specifically where I have invested in coaching and courses in software. I remember being on the student version of SketchUp forever, because I just wasn't ready to spend the money on the full version. And it was just silly, you know. And so what I realized is that, you know, I spent that initial, you know, several $1,000 invested in it. And I almost instantly saw that money come right back to me, because I was able to start booking clients, Discovery calls, were no longer painful for me or the person on the other side. And it's not that I turned around, and I just started, you know, blowing money left and right. But I recognized that there's a time and a place to invest in myself and yourself. Whenever you're feeling stuck. 

So maybe it's time for you to invest in a coach or join a mastermind, or take a course or join a membership, whatever you might need right now, in this moment that is going to, you know, give you the best chance of, of succeeding. And, you know, do your research and understand what you're investing in. And just approach it with an abundance mindset and know that if you if you know in your heart that it's it's a good investment, and it's going to help you trusting your gut and trusting your instinct, which is not what I had done in that moment, I had to go get validation from my husband, which I love him and I appreciated him and I needed him in that moment. Thankfully, I'm more trusting in myself today. But knowing when to invest in your business is a really impactful lesson that you can learn early on. 

Tough lesson number two, was, is ignoring red flags in clients. Anytime I've ignored a red flag, I have regretted it. And there have been times when I was operating from a place of scarcity. And I said yes to a project or a person that I knew wasn't a right fit. Red flags are red flags for a reason. And if you're unwilling to, to turn into them and to pay attention to them. You put yourself at risk for a lot of pain and suffering and heartache in the long run. So I think it's important to identify what red flags you might put as your deal breakers and to stick to it. I know that the times that I have not paid attention to red flags, or maybe I paid attention to them and I ignored them right. And I was like, well, maybe I'm just reading into it. Maybe it's not what it seems. I didn't get curious. I didn't talk I didn't have this attitude of curiosity and learning more. Oh, what's what's behind those words, right? Or what's behind that action? Because sometimes red flags red flags, blood and clear and sometimes we can miss construe red flag. So I think whenever it comes to red flags, getting curious, as always, what I suggest is just trying to dig a little deeper before you move forward. But ignoring red flags has always been a mistake that I've that I've regretted. So, identify what your red flags are for you specifically, and take up some space and saying know that you're not going to take a project or a client on just because, you know fill in the blank just because oh it's a hit. huge project or just because, oh, they have a ton of money or Oh, because they're well connected, but they're jerk, you know? And what are those red flags that you're willing to say, you know, I'm not going to put myself my time my business at risk, because I'm operating from a place of scarcity. Hey there, did you know that the designers Oasis website is chock full of resources for interior design business owners just like you, including loads of free downloadable tools, templates, checklists, and business guides, it's not called designers a waste is for nothing, head over to designers oasis.com To find the goodies like the client questionnaire, swipe file, or the asana template with my design process fully outlined for you, or the trade account action plan, my step by step guide to getting started with in organizing wholesale trade accounts. So you can make more money and your interior design, business, all that and so much more. So head over to designers oasis.com and see what's waiting for you.

Tough lesson number three, blending client money and biz, business operations money together. So what I mean by this is, early on. When I was just getting started, all I had was one single checking account, and all of the money from my business went into that one checking account. So you can just think of like filling up a bath water, right, or filling up a bathtub with water. And all that water just gets blended together. And you can't identify, you know, what, what of that money. And this is specific for designers who are doing any kind of purchasing for their clients. So your business operations, money is the money that you spend to run your business. So maybe that's a your software as a service, your internet, any sort of subscriptions, that you might be a part of equipment, that kind of thing. That is business operations money. But also, if you're doing purchasing for a client, you're taking their money, with the intent to spend it on product, to deliver it to be delivered to them, right. So if you put all that money into one pot, then it's very difficult to understand what's what. And it was incredibly stressful. 

So my recommendation is to open a couple of different checking accounts. The second checking out would have been one for business operations. And a second one for your client money for your your clients product. We call it a trust account. But that's your that's your clients money that is being held as a liability on your books for the intended to be spent on your clients product. And yes, eventually, some of that, because you will generally be making a markup and some of that will be yours to take the difference from at some point. But usually that's at the end of the project or at the end of the quarter, you can set it up a couple of different ways. But generally speaking, to start all that money goes into the trust account for the clients, for you to use on behalf of the client. The other thing that I did was open a third actually savings account. And that's where I would siphon money off for income tax sales tax money that stays in the trust account, right? Because the client that that is all related to the client's cost of goods sold and your revenue on product, but the money that I'm gonna owe for income tax, that should go into a separate savings account and you don't touch it. 

Beyond that, you could choose to open some additional savings or checking, checking accounts if you so desire. Maybe you want to have a profit account maybe. And this is you know, in addition to paying yourself for me personally, we do a monthly or BI monthly I don't even remember what it is but regular reoccurring payment to myself from the checking account. Okay, so that's that then the next thing that I did that really helped dial in and organize the money even more clearly was to have two separate credit cards to get paid off each month very clear distinction. I always, always always get paid off each month. One credit card is intended to pay for operating expenses. And that card gets paid every month out of the money that's in the checking account intended for or Biz Ops, right, that's what we call it Biz Ops. So that credit card is dedicated for paying for Internet paying for equipment and that sort of thing. And then the money that goes into that Biz Ops check is the money that you would receive for services. Okay, so the client pays you a retainer for a kitchen renovation or whatever that money goes into that account.

later down the line, when it's time to purchase, you know, lighting and bar stools, counter stools, whatever, that goes into a separate account. The other thing that I do is have a second checking, excuse me second credit card for the trust account. And that credit card, its sole purpose is for ordering products on behalf of my clients. And every month that card gets paid off out of that trust account. So if you can just envision two different funnels of money and the money just flows parallel, and it really never touches each other. But then you can choose how frequently you want to do it. But maybe it's twice a month or once a month, you have an automatic payment that goes to yourself out of that. Biz Ops, Biz Ops account, and then maybe quarterly, you look at what your earnings are on product sales, and you can pay yourself from the trust account, your let's call it a quarterly bonus. Okay, so blending client money and biz operations, money is going to make your head explode, trying to figure out what's what, and you run the risk of spending money that doesn't actually belong to you. So this is the solution to that.

Okay, tough business. Lesson number four, letting my ideal client profile get stale. I think there's this misunderstanding that identifying your ideal client is something you do once when you're just starting out in business. At least that's what I used to think. But eventually, when I had a string of some unsavory clients, were just projects that didn't really light me up. And I continue to get calls about projects, that just wasn't what I wanted to be doing, I had to take a step back, and understand where things were going wrong. Some of my research uncovered that the language on my website was not attracting the kinds of clients were the kinds of projects that I wanted to be doing the kind of projects that I wanted to be known for. So I went back and I researched and I refined who my ideal client was. And it was with this new understanding of this, this refined new ideal clients, that I was able to rewrite the copy for my website, and use that to attract the kinds of folks that were really dreamy to work with, and the kind of projects that light me up, and you know what it worked. So here is my advice to you, at least once a year, go back and look at your ideal client profile. What have you identified are their internal and external pain points? Who are they? What are their values? Why do you enjoy working with them all that good stuff, and then see if your website language, your social media, language, all of your collateral, all of those things and tools that we use to communicate with our audience and our clients? Are they reflecting the kind of person that you want to work with attracting the kind of person you want to work with? Is it language that is going to track the kind of projects that you want to be known for? 

I think doing this once a year is a really good exercise where we're coming to the end of the year, we're getting ready to have, hopefully a little downtime. And if you feel that itch, just to do a little back end business work, this would be a really great thing that you could do, just in your quiet time, if you're so inclined to if not sit back, relax and enjoy your holiday. But that is one thing that you could be doing with a little bit of downtime. And my final thought to that too, is that maybe if this past year, you may have found yourself working with some folks that weren't the kind of people that you want to be working with weren't the kind of projects that you want to be known for that you go back and you kind of look and see what what were some of the key characteristics of that person or that project and how you can try to move further away from those who move closer towards the work that really lights you up. Okay, and the fifth and final tough business lesson that I have learned is not realizing sooner, that I can't do it all. In order for me to be successful, I needed help and I needed to hire. I can't be the bookkeeper, the administration person, the marketer, the procurement manager and the designer. It was simply exhausting. And it will be exhausting for you too. And it will limit your growth. 

If you're trying to do it all, and give your clients a high level of service, you will burn out into the ground. So I will tell you, I was at this point a number of years ago, and I was I just in my brain, the words that I would say to myself was Why can't afford to hire somebody, nobody's gonna want to work 5- 10 - 15 hours a week,all of these myths, right, that were going through my head that I can't, it won't work, I can't afford it. I don't have the money. But when I sat down, and I looked at the numbers, and I looked at the fact that Well, I can hire somebody part time they work hourly, I'm I mark up their hours, then that actually opens me up to be able to do this other work, maybe that's working on a on a new client proposal or meeting with a prospective new client or working on a new concept design for a client. And that this person could help me with some of that back end administrative work and get me out of this backlog of work that I just didn't have time to get to. And I finally realized it clicked, I was like, I can't afford not to hire somebody. And on top of that, I can actually earn money and make money from, from my employees and a staff while also investing in them, making sure they're well compensated, and it's a win win for them. It's a win for me. And most importantly, it's a win for my clients, because they get a higher level of service, they get a better experience. And that my friend leads to word of mouth referrals. 

So you can't do it all forever, you need to understand that at some point, not only are you going to have to break through that initial wall of of your first hire, but then maybe at some point, you might be ready to bring on somebody full time or bring somebody on who is an employee versus a contractor, whatever that next growth step might be, and understanding what hiring this person going to offer you in terms of opening you up to new opportunities, you're going to be able to get through projects faster, so that you can start the next one sooner and earn that income sooner Are you going to be able to take on more than one projects, we're stagger them a little bit closer together so that you can, you know, do a few more projects a year or maybe it's not even doing more projects. But doing bigger projects that are more in depth, have bigger budgets that are maybe the kinds of projects that you want in your portfolio. So it's not always about having more clients. 

Sometimes it is, it might be more about just having a higher quality, higher caliber of client who are going to want and expect more service more hand holding more access to you and your team. So that could be another reason why you do that. But at some point, you have to know that you just can't do it all and do it all well. So I hope this has been helpful for you. I hope that a few of my hard learned lessons that I've shared with you today can help you see maybe some areas that you can or opportunities for growth. What are what are some of the growth indicators that you might be feeling right now? I'd love to hear from you. I hope you enjoyed today's episode. Have a wonderful rest of your day. I'll see you in the next episode. Thank you so much for letting me spend part of this day with you. If you're loving this podcast, please share it with a friend who you think might also love it. Or perhaps you can take just 30 seconds to open your podcast app and leave us a five star rating. And if you have just an extra minute, go ahead and leave a review. This helps me so much and it helps other designers like you to find the podcast. It also adds fuel to my motivation to keep making great episodes just for you. However you choose to help. Please know I appreciate you so very much. Thank you, my friend. Have a wonderful rest of your day and I'll see you next time