Understanding Design Fees, Labor Times & Labor Costs

Gross Profit Margin (GPM) helps florists determine whether their pricing is profitable. However, for many florists, GPM does not include design labor costs. And in many cases, the owner does not pay themselves a design labor wage, resulting in a labor cost of $0.00.

This raises a couple of important questions:

1. How can you evaluate the Design Fee, Design Labor Time, and Design Labor Cost for a floral arrangement or installation?

2. What are you really charging per hour for design labor?

Most florists charge a Design Fee, as part of their arrangement pricing, when they're using the industry standard pricing formula without ever asking:

• What exactly am I charging per hour to design this arrangement?

• Does my Design Fee truly cover my design labor time?

• Am I generating enough (or any) labor profit?

• Am I designing efficiently or am I taking too long to design an arrangement?

Finding the answers to the questions above can help improve your pricing confidence, your profitability and your design time efficiency.

What Is the Design Fee?

The Design Fee is the amount charged to a client for designing an arrangement or installation — regardless of how long it takes or how much you pay a designer.

A strong Gross Profit Margin may look healthy on paper, but without reviewing labor time and labor cost, it is easy to:

• undercharge for design labor

• overestimate design labor profit

• or spend too much time on certain designs

A skilled floral designer will typically complete an arrangement faster because of their experience and technique. And remember, a recipe-style arrangement usually takes far less time than a modern garden-style artistic design.

The goal is not simply to work faster — but to better understand:

• your Design Fee

• your Design Labor Time

• and your Design Labor Profit

Design Labor Time

Design Labor Time varies somewhat for an artistic garden-style floral arrangement. Particularily, when working within a floral budget rather than a fixed recipe. The time required to design an arrangement depends on:

• style and complexity

• flower selection

• mechanics and structure

• installation requirements

• experience and expertise

Larger and more complex designs demand a higher Design Fee. However, without reviewing design labor time, it becomes difficult to know whether your pricing is truly sustainable.

Let Floral Math Works Help

The Event Pricing tool helps evaluate:

• Design Fee

• Hourly Bill Rate

• Estimated Labor Hours

• Hourly Labor Cost

• Estimated Labor Cost

• Labor Profit

• Labor Cost % of Revenue

This helps bring clarity to both labor profit and design efficiency.

Hourly Bill Rate vs. Hourly Labor Cost

Floral Math Works uses two labor rates:

Hourly Bill Rate: the hourly rate charged to the client for floral design labor.

Hourly Labor Cost: the hourly rate paid to your florist, designer, or freelancer.

Your Hourly Bill Rate should be 2–3× higher than your Hourly Labor Cost.

Example:

• Labor Cost = $25/hour

• Bill Rate = $50–$75/hour

or

• Labor Cost = $50/hour

• Bill Rate = $100–$150/hour

Understanding Labor Profit

Formula

Labor Profit = Design Fee − Estimated Labor Cost

This labor profit helps cover:

• consultations

• revisions

• mood boards

• communication

• administrative time

• overhead expenses

Calculating Labor Hours

Floral Math Works estimates labor time using your Hourly Bill Rate

Formulas

Total Estimated Labor Hours = Total Design Fee ÷ Hourly Bill Rate

Total Estimated Labor Cost = Total Estimated Labor Hours x Hourly Labor Cost

The Flower & Financial Summary form displays:

• Total Design Fee

• Design Hourly Bill Rate

• Total Estimated Labor Hours

• Design Hourly Labor Cost

• Total Estimated Labor Cost

• Total Labor Profit

How to Evaluate Your Pricing

1. Open the Event Pricing tool

2. Select a floral product (example: bridal bouquet)

3. Enter a Design Hourly Bill Rate

4. Compare the Total Estimated Labor Hours to your actual time required to design the arrangement

5. Adjust the Design Hourly Bill Rate until the Total Estimated Labor Hours approximates your actual design labor time to complete the arrangement

Once the Total Estimated Labor Hours match your real-world labor time, you can better understand:

• the adjusted Design Hourly Bill Rate is what you are truly charging per hour for your design labor

• whether your Design Fee is appropriate

• and whether your design labor time is efficient

What Your Results May Reveal

If your Hourly Bill Rate appears rather low:

• your design labor time may be too long

• or your Design Fee may need to increase

If your Hourly Bill Rate appears rather healthy:

• your pricing may already support strong labor profitability

• and you may have flexibility to reduce your Design Fee to remain competitively priced

Though there are no universal design labor time standards in floral design--very florist’s style, arrangement complexity, and experience and expertise are different. The goal is to develop your own pricing benchmarks using real labor data.

Analyze Profitability by Product

Tracking your Hourly Bill Rate and Total Estimated Labor Hours will help identify:

• which products generate strong profit efficiently

• and which products require significant labor for lower returns

This insight can help improve pricing, workflow, and product offerings.

Final Thoughts

Understanding your Design Fee, Design Labor Time and Design Labor Cost helps clarify:

• how efficient you are

• what are you truly charging per hour

• what is your labor costs

• and is your labor profit sustainable

When you understand how long designs truly take — and how labor affects profitability — you gain greater confidence in pricing your floral work.

That is exactly what Floral Math Works is designed to help you do.

Pete

Creator of Floral Math Works