an online conversation
about design management


Are long-term clients a problem?

Managing a successful design studio is a dichotomy between designers wanting to work on a range of different projects, and owners aiming to form long-term relationships with a select group of clients.

We have successfully done the latter – we’ve forged relationships spanning over 15 years with eight clients – three of whom work exclusively with us and have done so for over 20 years. But there are downsides to the obvious advantages.

It’s easy to forget to increase your rates.

Research shows that most of us bill by the hour – we certainly do. And usually the hourly rate is a round figure – maybe $100 or 120, 150 or even 200.

The current Australian inflation rate is 2.9% – rounded to 3%.

Theoretically, we are meant to increase our costs annually to keep up with the rate of inflation but I’ve not heard of any designers that charged $150 per hour last year and now charge $154.50 per hour.

Instead, when we do increase our costs, we tend to jump 10% – from $100 per hour to $110, or from $150 to $165 – nice rounded figures that work well in accounting packages. And because it’s rather a large jump, especially on projects that need a lot of hours, we don’t usually do it annually. And that makes it easy to forget.

My solution is to annually re-estimate all standing work. This forces me to stop and assess the profitability of the project. I usually add an hour onto a task – it ruins my maths, instead of taking 5 hours to do something it now is marked as 5.15 hours but at least I’m keeping up with inflation.

Clients tend to pigeon-hole your services.

Long term clients don’t usually look at your website or ask you to submit for new projects — they just want to know the budget.

This means that they only know about the work you do for them, and that might be a narrow part of your complete services.

My solution is unashamed self-promotion. We need to communicate our breadth of skills to our clients, even if they don’t need them right now. There’s a few ideas:

 regular email newsletters – we are one of many studios that send monthly newsletters to keep clients up with all their latest projects

 push clients to your website –instead of using a third entity like hightail, you could use your own website to FTP large files. Likewise, we use the backend of our site to store logos that clients often ‘misplace’. Instead of me emailing them to the client, I ask them to access the files through our website

 supply submissions even when they are not required — our submissions work as a mini-folio, so I ensure I regularly supply a submission along with estimates for the larger jobs.

Your skills can be taken for granted.

At some stage, one side or the other gets taken for granted in most long-term relationships and relationships with clients are no different. It can get even more complicated if you get a majority of your work from one client.

I work very hard not to take our clients for granted. Being thankful for each project and treating clients with respect is a core value of our studio. I am very aware it’s easy to assume that you will get the work, especially when you know they don’t have a relationship with any other designer.

Unfortunately it doesn’t always seem to happen on the other side.

I do feel that it’s taken for a granted that timelines will be ‘saved’ when a client hasn’t meet their part of the schedule, or that it’s OK that changes can be ongoing, even if a budget is finite.

My solution is to ensure I am being well rewarded for my work – that there is some fat in each job. If I know the project is profitable it’s much easier to overlook an indiscretion. Similarly, if I am getting well paid, it’s not the end of the world if I need to juggle my workload to meet a deadline, or spend more than the allotted time to get a project finished.

Additionally, we’ve made it a rule to never get more than 30% of our work from one client for any length of time. It’s peace of mind to know that I could always walk away from a client if the relationship became too one sided (something, touch wood, that has never happened.)

But there are advantages

Of course their are many advantages to having long term clients. The most obvious is the intellectual knowledge we have about the client’s products or services that makes designing more enjoyable (because with knowledge comes understanding).

I think keeping these three things top of mind ensure the relationships’ sustainability.

 

CM

managing design clients