Business, Balance & Burdens: what does it take to successfully run a graphic design studio?
Continuing our partnership with Antalis Creative Power, The A Paper explores the often neglected and undervalued topics within the contemporary graphic design scene. For the fourth part of the series, we delved into the financial side of running a small creative business with Yah-Leng Yu, Principal at Singaporian studio Foreign Policy, and Erika Barbieri, Creative Director at Oslo-based studio Olssøn Barbieri.
EM What do you wish you knew when you started the studio?
EB That there is not such a thing as ‘Now, we can relax.’ Running a studio means there is always something to fix, learn or go through. Everything constantly changes. It’s true of life and of business. It is important to set new goals and keep moving.
EM How do you organise and stay on top of your finances?
YY Currently, we have an accountant who helps us out – to keep track of expenses and income. Honestly, I am not so on top of the finances although I should be. My partner and I will meet monthly to look at the numbers if we can, as much as we can. I would say usually he looks at the numbers much more. I think having that intimate relationship with the numbers is really key to running a studio as it sensitises us on our costs as well as how we should run projects and headcounts. Things like if the project should be a lean team or if we can afford to get a bigger team behind the project; or how much more to make to be ok for the month or for the quarter etc? Or, if we can go on a team trip somewhere for the year etc. It gives us a compass to how much we should also aim to charge for the projects coming in or how many projects we should aim to sign on for the quarter etc.
EB Every year we make a financial plan with all our expenses to see how much we need every month, so that we know and control how we are doing financially. This allows us to know when we can say yes to a project that we are interested in but have a small budget and when we need to focus more on reaching out to potential clients.
Yes, sometimes we do get it wrong.
EM How do you work out how much to charge for a project? Do you ever feel like you’ve got it wrong?
YY It’s really based on our experience how much we think it will cost us, whether it’s in terms of man-hours, office overheads as well as the profits that we should be making. Yes, sometimes we do get it wrong, when we underestimate a certain task or project. Sometimes we get to rectify it if the client is understanding and agrees to let us invoice them for the extra work. Most of the time, since it’s already a done deal as signed in the contract, you pretty much have to stick with it and deliver the project with that budget. It all comes through experience.
EB We are a creative agency and offer a value-based service (check out ‘Brutally Honest’ by Emily Cohen and Chris Do for great advice on how to run a creative business and how to make a budget).
In our experience clients know how much they can spend on a project, so we try as much as possible to listen and eventually also ask what is the budget allocated for the project. Not always do we have a straight answer but it’s a good way to start a conversation about budget and show that we are open to discussion.
Get it wrong. Yes, sometimes we wonder if we were not chosen for a project because we asked for too much or too little (that can also happen!). Better to let it go, try to learn something from the process, and look forward. Someone says: to get 1 job you have to interview for 10.
EM Have you ever undertaken a project you didn’t want to for financial reasons?
YY Yes, sometimes we do have to undertake such projects. But it also has to make sense for us, if it is going to be emotionally burdensome and mentally straining and the money does not really compensate for it, then we still will not take it. We have learnt over the years to be able to read telltale signs of such projects.
EB It’s rare that we are approached with a project that we don’t want, however, we have learned to read some red flags over the years of what might be a difficult client to work with. They are mostly clients that are not aligned with our vision.
We think to attract the work you want to do, you need to be clear and to manifest what you believe in. We don’t want to accept that the work you like to do not always is what pays the bills, even though sometimes it’s true, it is important to try to find a balance between inspiring creative work and the financial health of the studio. One cannot come at the price of the other.
EM What’s the biggest financial risk you’ve taken?
YY I think it’s the moving to a bigger office which we also decided to invest some funds into the interior design and workplace functions. I think renovation costs are easily in the high five figures which is massive for a small boutique like ours.
We have made the decision of being a small and ambitious studio.
EM What’s the most difficult conversation you’ve had with each other in regards to business?
YY Letting someone go.
EB Our roles in the studio.
After some years of running the studio, we felt uncertain about what was our next step and started to wonder about what person and role we needed to hire to grow our studio. Another designer, a project manager or a managing director. We are both designers and didn’t want to give that up. We asked for advice and hired a recruitment agency to help us find the right person. What we learned is that, in our case, we are the studio and should be in charge of it. This means that we have chosen to be a creative-led studio: Henrik is the Managing Director of Olssøn Barbieri and Erika is the Creative Director.
We believe that today, also bigger clients, even though they are used to the advertising agency structure, are more open to collaborating with creative led studios. Nothing gets lost in translation, and it puts the work at the centre of our studio practice. We live in a time where our idea of growth is still strictly connected with the capitalist model based on infinite economic growth and domination, and while we need to have a healthy business, we think that our focus should be to contribute to rehumanise our society. We have made the decision of being a small and ambitious studio, where work is at the centre of our practice and hopefully our passion will provide us with the vision and the work that we need in order to survive.
We just came back from our holidays in Italy where we visited the Triennale di Milano to see ‘Enzo Mari curated by Hans Ulrich Obrist.’ He is a great reminder of how a critical and ethical approach to design can create beauty and transformation.
EM What one piece of advice would you give to someone looking to launch their own design business?
YY Make sure you either are pretty financial or business savvy, if not, get a partner who is. A design studio is not an art gig just for fun, it is a real business. Being financially healthy is very very important if you want to continue to do fun projects and to be able to keep doing what you love; to be able to say ‘No’ to projects and work on those you like.
EB Do it your way.
It’s no secret that if you are a creative, how to run a business is probably not part of your curriculum, so you need to catch up a little. But that said, your endurance, motivation, network and talent (it’s important to be honest about what you are good at) will help you in your path.
Surround yourself with people that keep you reaching for the stars.
And at the beginning, before you have figured out how to handle an uncomfortable conversation with a client, consider inventing an accountant name, creating an email and let her (or him) sort things out for you.
Through Antalis Creative Power, leading paper company Antalis are publishing a series of in-depth articles in search of the ingredients to a memorable creation.