Dear Sean,

I am going to be collaborating with another design firm on a project, and we’ve decided to divide the job as follows: We will split the design work and installation evenly, and one firm will handle all the procurement and billing. What is the best and fairest way to proceed? Do you recommend we keep track of hours spent on procurement and deduct that amount from total procurement costs, and then split the income evenly? Or should we start with a 20-80 or similar split of proceeds? We want to be fair to each other, but the payment structure needs to make sense regarding workload.

Value Exchange

Dear Value Exchange,

Before jumping into specific advice as to how to split proceeds, let us tackle the elephant in the room: Why would you ever collaborate with another designer on a project? More specifically, why would you ever collaborate on a project where you are both working on the same scope? I am not saying it can’t work, but it is essential that the collaborative dynamic and operational structure is clearly defined.

Let us talk about what can never work: unequal parties. If you are a seasoned, recognized designer being asked to work with a firm junior to yours or vice versa, that’s an easy no for me. There is no point for either of you, as you will be painted with each other’s brush (and not to your benefit). If the work is amazing, the value will be diminished from the seasoned professional’s perspective, as it will seem like she needed the ingenue to validate her ability to execute the project. Likewise, the ingenue will not be recognized for her talent when the more experienced professional shares the credit. If the project does not succeed, both will suffer for obvious reasons.

So, assuming we are talking about a collaboration of equals here, the first question has to be one of scope. Having been through many showhouses, I think we can all agree that they are remarkable in their creativity but wholly disjointed when it comes to their overall vision. In fact, the more related the designs, the harder it is to talk about who did what. Perhaps the eclectic nature of a showhouse is what your client seeks. Then my advice is to divide the sandbox accordingly, and each of you own your scope as you would any other project. No sharing procurement or other responsibilities—just two designers doing their own separate designs under one roof like any other showhouse.

If, however, we are really talking about one vision to be jointly created, then boundaries are paramount. The design has to be wholly defined, as does the level of procurement—meaning the budget is absolute, and it must identify each and every element in detail (wholesale, retail, semi-custom, custom). Deciding which firm is best at what type of procurement will not suffice, because that leaves too much room for gray. Instead, you must determine the division of labor and profit based on specific elements to be manifested by each of you. Then and only then can you each quote a production number that will make sense no matter how you are generating the overall production fee for your client.

For example, let’s say you plan to spend $100 to procure 10 items, and the fee will be $35. Say each of you will be procuring five items, but yours are largely custom or semi-custom, and the other designer’s are from well-known wholesalers. It may very well be fair that you will receive 80 percent of the $35, or $28. Crucially, the discussion can only happen after the design is complete, and only after the total procurement fee is established.

Installation, as you say, will be equal; however, you must also determine the style. How far do you go during this stage? (Do you unpack clothes and put food in the refrigerator, or simply stage the house?) You must be on the same page before any fee can be established and split.

It is your choice to take on a project like this to create a singular vision with another designer. I am sure you have your reasons. Just know that it’s a huge minefield with unbelievable risks if you hit a mine. The sheer amount of work necessary to make sure you both have a chance for success should not be underestimated, and every nuance needs to be in writing between the two of you.

Last, it will be a dynamic, fluid situation and will require constant communication and reinforcing boundaries—all of which will cost the client, in more ways than one: namely, money, decision-making, and respect for both of you. The risk introduced has to be properly identified, or else you will pay for it. Dearly. Good luck.

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Sean Low is the go-to business coach for interior designers. His clients have included Nate Berkus, Sawyer Berson, Vicente Wolf, Barry Dixon, Kevin Isbell and McGrath II. Low earned his law degree from the University of Pennsylvania, and as founder-president of The Business of Being Creative, he has long consulted for design businesses. In his Business Advice column for BOH, he answers designers’ most pressing questions. Have a dilemma? Send us an email—and don’t worry, we can keep your details anonymous.