A candid conversation among DLN members reveals the complex strategies firms are using to manage a volatile market, from transparent billing to fostering team resilience.
In a moment defined by economic crosswinds—from startling tariff hikes and supply chain disruptions to geopolitical instability and the rapid ascent of AI—the leaders of the design industry are navigating a landscape of profound uncertainty. During a recent Leadership Advisory Board meeting, DLN members engaged in a frank, off-the-record discussion that moved beyond theory and into the practical realities of running a design business today. The conversation revealed a community grappling with shared challenges, innovating in real-time, and finding stability in collective wisdom.
While high-end residential design remains remarkably robust, a sense of caution pervades the market. As one member put it, we are in a "constantly moving target," and the central challenge is how to move from a reactive posture to a proactive one. Here’s how leaders are thinking about the path forward.
The most immediate pressure point discussed was the handling of new and often-stackable tariffs. A central question has emerged: should the cost be rolled into the price of goods, or should it be a transparent pass-through to the client? The consensus leaned heavily toward transparency.
“We’ve been treating tariffs as separate, as-is, like freight and delivery, with no markup,” one principal shared, noting this approach offers “total clarity.” Another member echoed this, stating, “I call it what it is. I call it on invoices a ‘tariff,’ and I don’t charge a markup.”
This strategy is not just about billing; it’s a client relationship tool. “For us to put the tariff as a pass-through cost to our clients is to say, ‘hey, we’re in this together,’” a firm leader explained. This builds trust and positions the firm as a partner navigating a complex situation alongside the client.
However, the group noted a complication: vendors and partners are increasingly bundling tariff costs into their own pricing to manage volatility. This makes a pure line-item approach more difficult and highlights the need for an industry-wide conversation on best practices—a conversation the DLN is committed to leading.
The discussion painted a picture of a bifurcated market. On one hand, high-end residential work remains strong. “Our work has been steady and consistent,” one member noted. “We have a lot of work, probably more work than we can effectively do.”
On the other hand, the commercial and hospitality sectors are feeling the chill of nervous capital markets. “It’s very, very hard to get financing,” a principal with a focus on larger-scale projects observed. “Any hotel thing that we start, stops and starts... our work is very episodic right now.” Another leader agreed, describing the commercial front as a “ton of stop-start,” making it incredibly difficult to staff and manage resources.
The conversation quickly expanded beyond tariffs and project pipelines to the human element. With teams largely under 30, firm principals are navigating existential anxieties around wealth inequality, climate change, and geopolitical turmoil.
“It can be interesting to realize our sense of futurity is very challenging,” one member reflected. “We don’t know what the economy is bringing. We don’t know what the geopolitical order is bringing. We don’t know what AI is going to do.”
This uncertainty impacts everything from team motivation to client relations. How do you incentivize a young employee towards a promotion when they are worried about the state of the world? How do you manage client conversations when a $7-a-gallon tank of gas is an irritant for a billionaire client but a source of genuine stress for your staff?
In a world that feels increasingly pushed to extremes, the discussion circled back to the foundational value of the DLN: community. “The DLN is a kind of safe space,” a member offered. “We may not always agree... but we respect each other and understand what we’re doing.”
Another leader emphasized that the organization’s strength lies in its core mission. “What was great about this organization is its foundation is about how do you run a business in design? And that doesn’t matter what style that you work in.”
In a time of unprecedented change, the path forward is not a solo endeavor. By creating a forum for honest, peer-to-peer exchange, the DLN provides a vital anchor, allowing leaders to share strategies, find solidarity, and collectively navigate the storm.
By joining the DLN, you gain entry to the conversations, perspectives, and relationships shaping the design industry today. If you’ve found inspiration here, imagine what you’ll find inside our community.
