Interior Design Retainer Agreement

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Table of contents

An interior design retainer agreement helps you manage the expectations of clients when it comes to fee structures and making payments on time. A small misunderstanding can greatly deteriorate the quality of your relationship. As such, if you're an interior designer, switching to retainers can provide more predictable income and help you maximize your revenue.

Unfortunately, most people don't know how to start. If you're confused about taking the first step, then don't worry. We're here to help. This article will guide you on what these agreements are and how you stand to benefit. Stick around till the end, and we'll guide you on where to start. Let's get into it.

What is an interior design retainer agreement, and why do you need it?

A retainer agreement is a contract between you and your client that outlines the terms of your services, including the scope of work, the fee structure, and the payment schedule. 

Essentially, it is a written agreement that defines the relationship between you and your client and sets expectations for both parties. This can make the beginning of a relationship much easier to understand and erases uncertainty.

One of the main reasons you need a retainer agreement as an interior designer is to protect yourself and your business. You can avoid misunderstandings and disputes with your clients by clearly outlining the scope of work. 

Another reason to use a retainer agreement is to ensure that you are paid for your services. The agreement should clearly outline the fee structure and payment schedule, including any upfront fees or deposits that may be required. This helps to ensure that you are compensated for your time and expertise and helps to prevent issues with non-payment.

A retainer agreement can also help to establish a long-term relationship with your client. By outlining the terms of your services, you can demonstrate your professionalism and build trust with your clients. This can lead to repeat business and referrals, which can be crucial for the growth of your business.

A well-written retainer agreement is an important tool for any interior designer. It helps to protect your business, ensure that you are paid for your services, and establish a positive relationship with your clients. By creating a detailed retainer agreement, you can set yourself up for success and ensure that your interior design projects run smoothly from start to finish.

What to include in an interior design retainer?

Here are some important elements to include in an interior design retainer:

1. Scope of Work

The retainer should clearly define the scope of the project, including the services to be provided and any limitations on your responsibilities.

2. Deliverables

An agreement should identify the expected deliverables of the project, such as design concepts, material selections, and final plans.

3. Timeline

The retainer should establish a timeline for the project, including milestones and deadlines.

4. Communication

The retainer should specify how the designer and client will communicate during the project, including preferred methods of communication and response times.

5. Change Orders

Your retainer agreement should address the process for change orders, which are revisions or additions to the scope of work that occur after the project has begun.

6. Ownership of Work

The retainer should clarify who owns the intellectual property of the design work, such as sketches and plans, and whether you or the client has the right to use or reproduce them.

7. Termination

The retainer should outline the circumstances under which either party can terminate the agreement, such as non-payment or failure to fulfill obligations.

8. Dispute Resolution

Lastly, the agreement should establish a process for resolving disputes between you and the client, such as mediation or arbitration.

Payment terms

The payment terms in a retainer agreement are critical to the project's success. Therefore, the agreement should clearly outline the fee structure and payment schedule for the project. 

This includes your hourly rate or flat fee, any upfront fees or deposits required, and the method and frequency of payment. It is essential to establish clear expectations upfront to avoid misunderstandings and ensure prompt payment. It is also a good idea to include provisions for late payments or bounced checks.

Working relationship

The working relationship between you and your client is another critical element of the retainer agreement. The agreement should clearly define the roles and responsibilities of both parties, including the scope of work, communication methods, and project timeline. 

It is essential to establish clear lines of communication to ensure that the project stays on track and that any issues or concerns are addressed promptly. The agreement should also include provisions for change orders, which are revisions or additions to the scope of work that occur after the project has begun. 

Clear communication and a strong working relationship are key to a successful project outcome. A well-crafted retainer agreement can help establish a solid foundation for this relationship.

Why use an interior design retainer

Using an interior design retainer agreement provides numerous benefits for both parties. Here are two main reasons why they are a great decision to incorporate into your business:

1. Predictable income:

One of the main benefits of using an interior design retainer agreement is that it provides predictable income for you. By establishing a flat fee or retainer for the project, you can avoid the unpredictability of hourly billing and ensure they are compensated for their time and expertise. 

This also provides greater financial stability and allows you to better plan and budget your resources for the project. This understanding will then lead to greater efficiency and a much more focused approach to each project. Ultimately, a predictable income is great for you and your client as it removes uncertainties.

2. Better client management:

Another major benefit of using an interior design retainer agreement is that it establishes clear expectations with the client. The agreement outlines the scope of work, deliverables, and timeline for the project, ensuring that both parties are on the same page. 

This helps to avoid misunderstandings and disputes and fosters a better working relationship between the designer and the client. By clearly defining the project's parameters, the designer can also better manage their time and resources, leading to a more efficient and successful outcome.

How much should I ask for?

Determining how much to charge for interior design services can be a challenging task. The pricing strategy should be based on several factors, including the project scope, your experience level, and current market rates. Here are some pricing strategies and payment methods to consider:

1. Hourly rate:

One pricing strategy is to charge an hourly rate for interior design services. This approach can benefit smaller projects or those with an uncertain scope. Hourly rates typically range from $75-$300 per hour, depending on the designer's experience level.

2. Milestone payments:

Milestone payments involve receiving payments at various stages of the project, such as the completion of the design phase, the procurement of materials, and the final installation. Milestone payments can be a better option for larger projects, as they provide the designer with regular cash flow throughout the project's duration. However, upfront payments can benefit smaller projects or clients who want to avoid multiple payments.

The chosen pricing strategy and payment method will depend on the designer's preferences, the project's scope, and the client's needs. Therefore, it is essential to establish clear expectations upfront to avoid misunderstandings and ensure a successful project outcome.

Industry benchmarks

If you want to know where the industry is heading and what to expect, it pays to do some research. Here are some statistics for the interior design industry to help you get started:

  1. Hourly rates at the top end interior designers typically range from $100-$200 per hour, depending on the designer's level of experience and location, according to Forbes.
  2. Flat fees for interior design projects can range from $5,000-$50,000, depending on the project's size and complexity.
  3. The interior design industry is expected to grow at a rate of 4.6% annually in the US, according to a report by IBISWorld.
  4. The residential interior design market accounts for approximately 50% of the industry's revenue. In comparison, commercial interior design accounts for approximately 25%, and institutional design accounts for approximately 15%.
  5. The global interior design market is expected to grow by about $24.13 billion by 2025, according to a report by PRNewswire.

A free interior design retainer agreement sample to get started

Choosing the right format to get started is essential. Here is a sample to help you understand what goes into a retainer agreement.


Create your own interior design retainer agreement with Bonsai

Bonsai offers exceptional client management services for interior design companies. Whether you're an SME or enjoy a global presence, Bonsai can help you engage clients and get on the same page with them. Alongside their CRM services, you can get access to your own tailor-made retainer agreements to use.

Having an effective agreement with your clients can be a great way to start off a fruitful relationship. You can use Bonsai's specialized agreements to cater to particular clients properly. Instead of using the same format for all clients, why not go the extra mile and connect with them much more closely? Bonsai can help with that.

If you want to develop an effective interior design retainer agreement, but can't afford the time or expense, then Bonsai can help. Sign up today for a 7-day trial and enjoy access to tailor-made agreements and manage your customers correctly.

Frequently Asked Questions

Questions about this template.

How does an interior design retainer agreement benefit me?

An interior design retainer can ensure that for longer-term projects you are able to obtain a predictable income stream and avoid the highs and lows associated with hourly or contract work.

Can I create my own interior design retainer agreement?

Creating your own is certainly possible. It should be noted that Bonsai vets all of our templates with counsel to ensure the contracts contain no gaps that can be exploited though.