The Brad Leavitt Podcast: Financial Management for Interior Designers with Julia Nikishina
Click image to listen to the full conversation on Youtube.
Inside the Conversation With Julia Nikishina: Understanding the Financial Blind Spots in Interior Design
The podcast features Julia Nikishina, founder of New Age Financial Consulting, a firm that works exclusively with interior designers and specializes in Studio Designer. Julia explains that most design firms struggle not because of a lack of creativity but because the industry has no clear financial standards. This lack of structure results in lost revenue, inconsistent pricing, and systems that can’t scale. The conversation dives into the operational and financial habits that separate stable, profitable firms from those constantly battling inefficiencies.
Why Designers Struggle With Financial Structure
Julia highlights that design is one of the few industries where financial practices vary wildly from firm to firm. Without standardized processes, designers often rely on guesswork when estimating costs, marking up product, managing freight, or structuring flat-fee projects. This leads to unclear profitability, constant surprises, and chaotic project delivery.
She makes it clear that profitability is not accidental. It’s a result of disciplined habits around tracking, reporting, and documenting financial data, something many creatives avoid but desperately need.
The Hidden Cost of Not Tracking Time
One of Julia’s strongest points is that not tracking time is the root of most financial blind spots. Even firms working on flat fees need to understand how many hours they spend on each project. Without this data:
Firms have no idea whether the fee structure is profitable
Designers consistently undercharge for their labor
Burnout increases because leadership cannot see where the workload is going
Pricing becomes emotional instead of strategic
Julia stresses that even a simple weekly review of hours is far more effective than ignoring the numbers entirely. Time data is what allows firms to refine pricing, improve margins, and understand the true cost of operations.
Freight, Logistics, and the Expense Designers Always Miscalculate
Julia explains that freight is one of the most inconsistent and poorly tracked costs in the industry. Designers often estimate freight or assume a percentage, but actual shipping charges frequently vary from vendor to vendor. When freight isn’t tracked properly:
Product margins become inaccurate
Firms lose money without realizing it
Clients may challenge charges due to unclear documentation
Beyond freight, she also calls attention to receiving and warehousing. When construction delays extend timelines, products often sit in storage longer than expected—accumulating receiving fees, storage charges, and administrative time. Many designers absorb these costs simply because they don’t track them carefully.
Price Changes and the Importance of Clear Contract Language
Vendor price changes happen constantly. Yet many designers lack contract clauses that explain:
Whether price changes can be passed to the client
How often pricing may shift
What happens when a vendor increases costs mid-project
Julia explains that without this clarity, designers end up absorbing cost increases, sometimes thousands of dollars per project. Clear, upfront contract language protects margins and reduces client friction.
Why Accrual Accounting Gives Designers a More Accurate Financial Picture
Julia recommends accrual accounting for design firms because it provides a more realistic view of financial health. When firms take large retainers or deposits up front, cash-based reporting can make income look inflated. Accrual accounting spreads income over the life of the project, aligning revenue with the actual work being performed.
This method gives owners clarity on:
True monthly profitability
How much revenue is genuinely “earned”
Whether the business can sustainably cover overhead
How upcoming work aligns with income forecasts
This prevents the false sense of security that many designers experience when their bank accounts look full but their projects have barely begun.
Building a More Intentional, Profitable Firm
Throughout the conversation, Julia reinforces that well-run firms don’t rely on guesswork. They build systems that support clarity in operations, client communication, and pricing. Designers who embrace documented processes, transparent financials, and clear expectations consistently outperform those who rely on instinct alone.
She encourages designers to see profitability as the result of:
Consistent time tracking
Accurate cost management
Clear contracts
Transparent procurement processes
Realistic pricing and margin strategy
These habits create a business that is resilient, scalable, and confident, not one that constantly reacts to unexpected expenses or project fires.
The Bottom Line for Designers and Builders
This conversation is essential for any designer or builder who wants to stop operating reactively and start leading their business with clarity. Julia’s insights show how structure, numbers, and financial discipline ultimately give designers more freedom, not less. With the right habits, firms clean up their backend, understand their true profit, and operate with far more confidence.
You’ll walk away with practical, immediately usable strategies to strengthen your financial systems, protect your project margins, and elevate the way you run your studio.
-
In this episode, the discussion centers around the financial challenges interior designers face, challenges that often go unnoticed until they become major operational roadblocks. Julia Nikishina, founder of New Age Financial Consulting, brings clarity to a topic many designers quietly struggle with. Her firm works exclusively with interior designers and is deeply rooted in Studio Designer, the niche accounting and project management platform built specifically for the industry. Because of this focus, she has spent years studying how firms operate behind the scenes, and she has seen the same problems repeat across studios of every size. According to Julia, the biggest hurdle designers face isn’t creativity; it’s the absence of financial standards in the industry.
She explains that unlike architecture, construction, or other professional service fields, interior design has no widely accepted financial frameworks. Every firm invents its own systems, which means pricing, margins, procurement workflows, billing methods, and even contract language vary dramatically. This lack of consistency leads to lost revenue, inaccuracies that snowball over time, and financial systems that can’t support growth. Julia’s insight cuts straight to the core: designers aren’t failing because they’re disorganized; they’re failing because no one ever taught them how to build the financial structure their businesses need.
Throughout the conversation, Julia breaks down the operational and financial habits that distinguish profitable, well-run firms from those constantly putting out fires. Her tone is direct, practical, and grounded in real experience, offering a behind-the-scenes look at what truly drives financial stability in a creative business.
Julia emphasizes that interior design is one of the only industries where firms routinely operate without any standardized financial process. She explains that when it comes to estimating product costs, marking up items, managing freight, or structuring flat-fee projects, most designers are forced to guess. Because there are no industry benchmarks, they rely on instinct, copying peers, or making assumptions that don’t hold up as project complexity increases.
This guesswork becomes a silent threat within a growing business. Without clean systems, designers find themselves blindsided by unexpected costs, scrambling to justify pricing to clients, and constantly revising estimates that were never grounded in real data. Julia makes an important point: profitability isn’t magical, and it’s never accidental. It comes from disciplined habits, habits many creative professionals avoid because financial management feels overwhelming or outside their comfort zone.
She explains that every profitable firm she has worked with, from boutique studios to large design practices, has strong systems around tracking, reporting, and documenting critical financial details. When firms rely on memory, emotion, or assumptions, the numbers always become messy. When they commit to structure, their profitability becomes predictable, and their operations become significantly easier to manage.
The Hidden Cost of Not Tracking Time
Julia brings a level of intensity to the topic of time tracking, making it clear that this single habit is one of the most powerful predictors of profitability. She explains that even when firms bill on a flat-fee basis, they must understand how many hours go into design, procurement, revisions, meetings, and project management. Without this visibility, no one can assess whether a flat fee is too low, too high, or simply impossible to execute profitably.
She describes what happens in firms that don’t track time. Owners have no objective way to determine if the pricing for a project makes sense. Designers unknowingly undercharge themselves because they underestimate how long tasks actually take. Burnout rises, because leadership cannot see where the workload is concentrated or whether certain team members are overloaded. And pricing becomes emotional; instead of using data to guide decisions, owners rely on gut feelings, which often leads to chronic underpricing.
Julia explains that firms don’t need complex or rigid systems to benefit from time tracking. Even reviewing recorded hours weekly provides invaluable clarity. Time data helps owners refine their pricing, understand their staffing needs, improve margins, and uncover inefficiencies hiding inside their processes. Without this foundational habit, every other financial effort becomes guesswork.
Julia dives deep into one of the most unpredictable, and most neglected, areas of design finances: freight. She explains that freight is one of the least consistent expenses in the industry. Designers often estimate shipping costs or apply a generic percentage, but actual freight charges vary wildly from vendor to vendor. When these costs aren’t tracked accurately, product margins quickly become distorted, and firms end up losing money without realizing it.
She also highlights how freight mismanagement often leads to client disputes. When firms cannot clearly show the actual costs behind freight charges, clients question them, creating unnecessary friction. The problem isn’t dishonesty; it’s the lack of a system to track these expenses precisely.
Beyond freight, Julia discusses the hidden costs of receiving and storage. She explains how warehousing fees accumulate when products sit in storage for months, often because construction delays prevent installation. These extended timelines cause receiving fees, storage charges, and administrative oversight to pile up. Many designers absorb these expenses simply because they have no system for tracking or communicating them. Without visibility, profit quietly disappears.
One of the most revealing parts of the conversation is Julia’s perspective on pricing volatility. Vendor prices change constantly, and yet many designers have no contract language protecting them from these fluctuations. She explains that without clauses addressing price changes, designers are often forced to absorb increased costs mid-project, sometimes amounting to thousands of dollars.
She highlights how much clarity contract language brings to the client-designer relationship. When contracts clearly state how price changes are handled, clients understand the financial fluidity of sourcing custom furniture or materials. This transparency reduces stress, avoids confrontation, and ensures that designers aren’t penalized for circumstances outside their control.
According to Julia, the contract is not just a legal document; it’s one of the strongest financial tools a design firm has. Clear terms around pricing, freight, returns, procurement processes, and timelines create a smooth, predictable project experience and protect the firm’s margins.
Julia distinguishes between accrual accounting and cash accounting, explaining why accrual accounting offers a far more accurate representation of the firm’s financial health. Cash-based reporting makes revenue appear inflated when clients pay large retainers or deposits, giving owners a false sense of security. Accrual accounting, on the other hand, spreads income across the duration of the project, aligning it with the actual work completed.
She describes how accrual accounting helps firms understand their true monthly profitability, revealing whether the business is genuinely performing well or simply benefiting from temporary cash flow. This clarity helps owners make hiring decisions, evaluate operational capacity, and forecast revenue more accurately.
Julia stresses that many designers run their businesses based on the money in their bank account. When the account is full, they feel confident; when it’s low, they panic. Accrual accounting removes this emotional rollercoaster and replaces it with a clear, objective picture of how the business is performing. It creates stability and eliminates the shock that comes when firms realize they’ve spent money that technically isn’t theirs yet.
Throughout the conversation, Julia returns to one central message: successful design businesses operate intentionally. They don’t hope for profit; they build the systems required to create it. Well-run firms have documented workflows, transparent financial reporting, strong client communication habits, and consistent expectations across their team.
Julia explains that firms who embrace clear processes are able to scale without chaos. Their margins improve because they track costs accurately. Their team performs better because roles and responsibilities are clearly defined. Their clients trust them because billing is transparent and predictable. Their owners feel more confident because decisions are based on data, not stress or guesswork.
She encourages designers to embrace the habits that create long-term profitability. Consistent time tracking, accurate cost management, clear contracts, transparency in procurement, and realistic pricing are not optional, they are the foundation of a scalable business.
This conversation is invaluable for designers and builders who want to operate with clarity instead of constant reaction. Julia’s insights make it clear that financial structure is not restrictive, it’s empowering. When firms implement strong financial habits, they gain the freedom to scale, the confidence to price accurately, and the stability to run projects without fire drills.
The message is simple but powerful: design firms don’t need more creativity to succeed; they need better systems. With the right structure in place, designers can clean up their backend, protect their profit, and lead their businesses with far greater confidence and intention.
