FEATURED ON THIS EPISODE:

JOIN MY UPCOMING WORKSHOP ON THURSDAY, MAY 8 AT 12:30 EST: HOW TO PRICE CONSTRUCTION PROJECTS WHEN YOU’RE MORE THAN JUST THE DESIGNER

JOIN THE WAIT LIST FOR MY REVAMPED COURSE INTERIOR DESIGNER’S GUIDE TO CONSTRUCTION MANAGEMENT

WHAT YOU’LL LEARN IN TODAY’S EPISODE:

WHAT’S BEHIND THE ECONOMIC UNEASE IN BOTH CONSTRUCTION AND DECORATING WORLDS

HOW TO BREAK INTO THE LUXURY CONSTRUCTION WORLD

HOW TO COME OUT STRONG ON THE OTHER SIDE OF ECONOMIC UNCERTAINTY

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There is some benefit to being in this industry for 32 years, and that is, I have seen the high’s and lows’ of our industry. And while we can’t control which way our economy will go, we can control how our businesses react to them.

Today, we’re going to talk about what’s behind the economic unease and how it is impacting both the construction and decorating worlds differently. It’s not just about the rising tariffs, it’s about who the buyer is that you are targeting. 

Believe it not, while decorating may be slowing down, construction or renovation is holding strong among wealthy clients. They are still building. They are still renovating, and the designers who lead those projects profitably, they’re not going to just survive this moment; they’re going to grow their businesses. 

Construction

According to multiple industry sources, construction costs have increased 30-50% over the past few years depending on location and project type and they are not stabilizing yet. We’re looking at tariffs from Canada, Mexico and China, and we don’t know where they’ll go and how long they’ll be in place, so that impacts steel, lumber, aluminum, drywall, and on and on. 

But what’s not talked about a lot is the increasing concern about labor shortage. IT is not a secret that the construction industry relies on undocumented workers, so if projection where they’re estimating about 1.8 million undocumented construction workers are deported, that could dramatically impact the availability and costs of skilled labor, which every construction project needs. So, agility is really the key in this situation because you not only have to be aware of this, you have to be aware of who you are working with, the labor that they are utilizing now and hone in on your management skills because you will be needing to use them more in different directions than ever before. 

Because if you are facing labor shortages and have always relied on one painting company, and he loses five guys, you’re likely going to find yourself in a situation. You need to be agile enough to find another vendor who can step in at the same level of quality that you deliver to your clients, perhaps even at a moment’s notice. 

This is where industry partnerships, which I’m always talking about, come into play.

This is all part of our expertise that we will offer to our clients. And this all happens behind the scenes in your business. 

There is a lot of uncertainty right now, and the more we can communicate that amongst ourselves, behind the scenes, amongst colleagues, gives me the knowledge to share appropriately with my clients.

Not only is that the service they’re looking for from me, but it also furthers my role as an expert.

Decorating

If you’ve listened to me in the past, you know I am firm in my belief that clients see decorating as a luxury service, meaning it is something that can be put off. And clients see construction projects as an investment in their home.

High Point Market just wrapped up last week. After I caught up with some friends and designers and read some of the newsletters I get, it turns out designer attendance was down. Some estimate 7%, some estimate 10%, but it was apparently noticeable.

And apparently, international buyers dipped almost double that. Again, I think that can be explained by the uncertainty that we’re all experiencing. But it also further supports my claim that decorating is a luxury. 

When the economy clients may pause on changing out their sofa, drapery, and furnishings in their living room. But they rarely delay renovating that dysfunctional kitchen or reconfiguring a bath, or making a newly purchased home livable. But I want to say, there is a caveat to that, when the times get tough, it is the luxury market. Those clients are the ones who are still moving forward with the significant construction projects. They have that financial stability. They view their real estate as an appreciating asset. They want their homes to reflect their lifestyle, their goals, and that they understand and trust that well-executed projects will continue to add long-term value.

Not all construction projects are moving at the same pace right now

I am hearing almost daily right now that the designers and contractors who are focused on mid-level remodels, where the budgets are tighter and the clients are more price sensitive, that they are feeling the effects and rising costs, the longer timelines, and getting general hesitation and a lot of them are pushing the pause button. 

But the high end keeps moving forward.

I’ve heard that from the contractors I work with. I know that my workload is stable, and I’m hearing that from other designers around the country. 

So the opportunity is still there for construction management. The difference is the access to the types of projects that still continue even in unstable times.

And so it is important to break into that luxury construction world. 

How to start

That truly starts with mastering the role of a construction savvy designer. And I don’t mean just creatively, I mean strategically. 

Clients at that level expect us to do more than just choose finishes and answer a few follow-up questions. They absolutely expect us to lead, to coordinate, to anticipate, to problem solve, to speak the same language as the contractors, to act as their liaison, to see that design intent you created, maintained throughout the entirety of the project. 

So when you build construction management into your business, you are not just offering design. You are offering leadership, project continuity, and client peace of mind. You are offering this service from the very beginning of meeting the client, well through the punch list and beyond.

For those of you already managing construction projects, I hear you, I see you, I understand how you’re feeling. My first recommendation is to get ahold of your industry partners, figure out how they’re doing, determine to figure out how you can support each other through whatever economic uncertainty comes, but also to focus on upleveling that service to get into that luxury market so that you can be more stable regardless of what the economy does now or in the future.