What Are You Really Charging Per Hour for Design Labor?

Check out the four new calculators under the section titled Design Labor & Fees on the home-page under Pricing & Profit Tools!

Many studio florists price arrangements using a simple rule of thumb: multiply the wholesale cost of flowers and hard goods by four or five and call it the selling price. While this approach is common, it raises an important question:

What are you actually charging for your design labor?

For many florists, the answer is surprisingly unclear.

The Problem with Cost Multipliers

When you simply multiply your flower cost and the hard goods cost to determine your Retail Selling Price, you're assuming that labor is somehow included in the final price. But how much labor? And at what hourly bill rate?

Consider two arrangements with the same flower cost:

• Arrangement A takes 30 minutes to design.

• Arrangement B takes 2 hours to design.

If both are priced using the same multiplier, the florist is effectively charging vastly different hourly bill rates for labor. Without measuring labor separately, it's impossible to know whether your pricing is generating a labor profit—or simply covering costs.

The Industry Standard Approach

The traditional floral industry pricing formula treats labor as a separate component of the selling price. Rather than hiding labor inside a flower markup, the formula includes a Design Fee for every arrangement.

This approach allows you to:

• Recover the cost of design labor.

• Generate a profit on labor.

• Price complex designs appropriately when labor times are much greater.

• Understand exactly where your design fee comes from.

Most importantly, it provides visibility into one of the most valuable resources in your business: your time.

Your Design Fee Reveals Your Hourly Bill Rate

Once a Design Fee has been established, you can evaluate the amount of time required to create an arrangement.

For example:

• Design Fee: $90

• Design Time: 1.5 hours

In this case, you are effectively charging $60 per hour ($90/1.5=$60) for design labor.

But that's only part of the story.

One of Floral Math Works Design Labor & Fees calculators calculates a Hourly Bill Rate for you. Easy peasy.

The Design Fee, Design Labor Cost and Design Labor Profit

Every florist should understand the difference between:

• Labor Charge – the Design Fee charged to the client.

• Labor Cost – what it costs to perform the labor.

• Labor Profit – the amount remaining after labor costs are paid.

Suppose:

• Design Fee: $90

• Design Time: 1.5 hours - example

• Hourly Pay Rate: $30 per hour

Labor Cost = 1.5 x $30 = $45

Labor Profit = Design Fee - Labor Cost = Labor Profit, $90 - $45 = $45

Hourly Bill Rate = $90/1.5 = $60

• Design Fee: $90

• Design Time: 2.0 hours - example

• Hourly Pay Rate: $30 per hour

Labor Cost = 2.0 x $30 = $60

Labor Profit = Design Fee - Labor Cost = Labor Profit, $90 - $60 = $30

Hourly Bill Rate = $90/2.0 = $45

Now you know not only what you're charging per hour, but also how much profit your labor is generating. This information is critical when evaluating pricing, hiring freelancers, and determining whether your business is truly profitable.

When the business owner is also the floral designer and does not pay themselves an hourly design wage, the Design Labor Cost may technically be $0.00.

In that case, the Design Fee can theoretically be considered entirely Design Labor Profit. However, that profit still requires your time to earn it. You have to spend time designing the arrangement, even when there is no hourly wage recorded as a labor cost.

Once you know your Design Fee and determine your Design Labor Time, you can calculate the Hourly Bill Rate you are actually charging the customer for your design labor. This gives you a much clearer way to evaluate whether your Design Fee adequately reflects the time and skill required to create the arrangement.

Why Every Florist Should Measure Labor Profit

Many florists carefully track flower costs and hard goods costs, yet never evaluate whether their labor is producing a profit. If labor is not profitable, increasing sales volume may simply mean working more hours without increasing income.

Understanding labor profit helps answer questions such as:

• Am I charging enough for my design work?

• What is my effective hourly bill rate?

• Is my labor profitable?

• Should I increase my Design Fee?

• Which arrangements are the most profitable?

These are some of the most important questions a florist can ask.

See the blog post titled:

Understanding Design Fees, Design Labor Times & Design Labor Costs.

It explains why it’s important to evaluate your Design Fee—even when you, the owner, design the florals without paying yourself a wage, resulting in a Design Labor Cost of $0.00.

How Floral Math Works Helps

Floral Math Works helps florists move beyond guesswork by evaluating:

• Design Fee - fee charged to client to design the arrangement

• Hourly Bill Rate - hourly rate charged to client

• Design Labor Time - labor time required to design the arrangement

• Hourly Pay Rate - hourly rate paid to designer or florist

• Design Labor Cost - hourly pay rate x design labor time

• Labor Profit - Design Fee - Design Labor Cost

Instead of wondering what you're earning for your time, you can see exactly what you're charging per hour, how long each arrangement takes to design and whether your labor is generating a profit. Because at the end of the day, knowing the price of an arrangement is important—but knowing what you're actually earning for your labor is essential.

Best,

Pete

Creator of Floral Math Works