Kitchen design studio: average revenue, profit and margins

This article was written by our expert who is surveying the industry and constantly updating the business plan for a kitchen design studio.

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The Dojo Business Team

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What is the current average annual revenue for a kitchen design studio?

The average annual revenue for a kitchen design studio depends heavily on the studio's size, market positioning, and geographic location.

Small kitchen design studios typically generate around $120,000 per year, which translates to approximately $10,000 per month. These studios usually operate with a lean team and focus on a local or neighborhood market, completing 4 to 8 projects monthly with an average project value of $12,500.

Medium-sized studios, often located in urban areas with higher market demand, average roughly $600,000 annually or $50,000 per month. These businesses handle 4 to 6 projects per month with project values ranging from $10,000 to $25,000. They typically employ 5 to 10 staff members and have established relationships with suppliers and subcontractors.

Large or high-end kitchen design studios can reach $1.2 million or more per year. These studios focus on luxury projects with values between $25,000 and $50,000 or higher, completing 3 to 5 projects monthly. They often serve affluent markets and offer premium design services, custom cabinetry, and high-end appliances.

Revenue levels are directly influenced by the studio's ability to attract clients, the average project size, and the efficiency of project delivery.

What is the typical profit margin percentage for kitchen design studios?

Most kitchen design studios report gross profit margins between 35% and 40%, while net profit margins range from 12% to 15%.

Gross profit margins reflect the difference between revenue and the direct costs of delivering services (materials, subcontractors, and installation labor). Studios that successfully negotiate favorable terms with suppliers and manage project costs tightly tend to hit the upper end of this range.

Net profit margins account for all operating expenses, including fixed costs like rent, software subscriptions, insurance, utilities, and payroll. Well-managed studios with strong operational efficiency and effective cost control can achieve net margins of 15%, and some boutique or high-volume operations may even reach 20%.

Profitability is impacted by the studio's pricing strategy, the mix of design services versus product sales, and how effectively the business controls overhead. Studios that focus on high-margin consulting services and maintain lean operations generally outperform on profit metrics.

You'll find detailed market insights in our kitchen design studio business plan, updated every quarter.

What is the average net profit in absolute terms for small, medium, and large studios?

Net profit in dollar terms varies significantly based on the studio's revenue and operational efficiency.

What percentage of revenue is usually spent on fixed costs?

Fixed costs for kitchen design studios typically account for 35% to 40% of total revenue.

These costs include rent for showroom or office space, software subscriptions for design tools (such as CAD programs, project management platforms, and accounting systems), insurance (general liability, professional liability, and property insurance), utilities, and other recurring expenses that do not fluctuate with project volume.

Rent alone often represents 10% to 20% of revenue, particularly in urban or high-traffic locations where visibility and accessibility are important for attracting clients. Studios in less expensive areas or those operating from home offices can keep rent costs lower.

Software and technology expenses, while smaller in absolute terms, are essential for modern kitchen design studios and can range from 2% to 5% of revenue. Insurance costs vary based on the studio's size, location, and services offered, but generally fall within 2% to 4% of revenue.

Controlling fixed costs is crucial for maintaining profitability, especially during slower periods when project volume decreases.

What percentage of revenue is commonly allocated to variable costs?

Variable costs, which include materials, subcontractors, and installation labor, usually make up 40% to 50% of revenue for kitchen design studios.

Materials encompass cabinetry, countertops, appliances, fixtures, hardware, and other kitchen components. Studios typically purchase these products at wholesale or trade prices and then mark them up for retail sale. The cost of materials as a percentage of the selling price varies but generally falls between 50% and 75%, depending on the markup applied.

Subcontractor and installation costs account for 30% to 50% of the product costs provided. Studios often outsource installation work to licensed contractors or tradespeople, and these labor costs must be carefully managed to preserve margins.

Effective negotiation with suppliers and subcontractors, as well as efficient project management to minimize waste and rework, are key to keeping variable costs within the target range. Studios that can secure volume discounts or establish long-term partnerships with reliable vendors gain a competitive advantage.

This is one of the strategies explained in our kitchen design studio business plan.

How much of total revenue typically comes from design fees compared to product sales and installation services?

Kitchen design studios generate revenue from three primary streams: design fees, product sales, and installation services.

Design fees typically represent 15% to 25% of total revenue. These fees cover the consultation, space planning, 3D renderings, material selection, and project coordination. Some studios charge hourly rates, while others use flat fees based on project scope. Design services carry higher gross margins (40% to 50%) because they involve lower direct costs.

Product sales—including cabinetry, appliances, countertops, fixtures, and hardware—account for 60% to 70% of total revenue. This is the largest revenue stream for most kitchen design studios. While product margins are lower (25% to 35% gross margin), the volume and ticket size make this segment critical to overall profitability.

Installation and labor services contribute roughly 10% to 20% of revenue. In some studios, installation fees are bundled with product sales, while in others, they are billed separately. Full-service studios that manage the entire installation process tend to have more control over costs and timelines, which can improve client satisfaction and referrals.

The revenue mix depends on the studio's business model: design-focused studios may generate more from fees, while product-focused studios rely heavily on sales volume.

What is the average gross margin on kitchen product sales versus design and consulting services?

Gross margins differ significantly between product sales and design services in the kitchen design studio business.

How many projects per year does a typical kitchen design studio complete, and what is the average project value?

Project volume and average value vary based on the studio's size, market, and client base.

Small studios typically complete 4 to 8 projects per month, resulting in 48 to 96 projects annually. The average project value for these studios is around $12,500, generating monthly revenue of approximately $50,000 to $100,000.

Medium or urban studios handle 4 to 6 projects per month (48 to 72 projects per year) with an average project value between $10,000 and $25,000. These studios focus on a mix of mid-range and higher-end projects, balancing volume with profitability.

High-end or luxury studios complete 3 to 5 projects per month (36 to 60 projects annually) with project values ranging from $25,000 to $50,000 or more. These studios prioritize quality over quantity, targeting affluent clients who are willing to invest in premium materials, custom designs, and exceptional service.

The average project value is influenced by the studio's brand positioning, the local market's purchasing power, and the scope of services offered. Studios that bundle design, products, and installation into full-service packages often achieve higher project values and better client retention.

What is the client acquisition cost on average, and how does it compare to lifetime client value?

Client acquisition cost (CAC) for kitchen design studios is estimated to be between $200 and $400 per client.

This cost includes marketing expenses such as digital advertising (Google Ads, Facebook, Instagram), website development and SEO, local print advertising, showroom events, trade show participation, and referral incentives. Geography, competition, and marketing channel effectiveness all influence the actual CAC.

Lifetime client value (LTV) for kitchen design studios ranges from $12,500 to $20,000, driven by the high ticket price of kitchen remodeling projects. While kitchen remodels are infrequent (typically once every 10 to 20 years), satisfied clients often provide referrals, which significantly increase their lifetime value.

The LTV-to-CAC ratio for well-performing studios is typically 30x to 50x, indicating a highly favorable return on marketing investment. Studios that prioritize exceptional service, follow-up, and referral programs can maximize lifetime value and reduce dependence on paid acquisition channels.

Referral-driven growth is particularly important in this industry, as word-of-mouth and online reviews carry significant weight in the decision-making process for homeowners considering kitchen renovations.

What are the most common pricing models used, and how do they impact profitability?

Kitchen design studios use several pricing models, each with distinct implications for profitability.

• Hourly Rate for Design Services: Studios charge clients based on the number of hours spent on design and consultation. Rates typically range from $75 to $200 per hour depending on the designer's experience and market. This model provides transparency but can limit revenue if project scope expands without corresponding fee increases.
• Flat Fee for Design Services: A fixed fee is charged for the entire design project, regardless of hours worked. This model is easier for clients to budget and can be more profitable for experienced designers who work efficiently. Flat fees typically range from $1,500 to $10,000 depending on project complexity.
• Cost-Plus Pricing on Products: The studio purchases products at wholesale or trade prices and applies a markup (typically 20% to 40%) to the retail price. This model is straightforward and aligns with client expectations but may reduce competitiveness if markups are too high.
• Milestone or Staged Payments: Clients pay at specific project milestones (e.g., design approval, material order, installation start, project completion). This model improves cash flow and reduces financial risk for the studio, especially on larger projects.
• Hybrid Bundled Pricing: Studios offer a package that includes design, products, and installation for a single price. This model simplifies the client experience, increases perceived value, and allows the studio to control costs and margins across the entire project. It is particularly profitable when the studio manages subcontractors effectively and minimizes waste.

We cover this exact topic in the kitchen design studio business plan.

What are the average staffing levels and payroll costs as a percentage of revenue?

Staffing levels and payroll expenses vary with studio size and business model.

What trends or benchmarks have shifted recently in revenue, profit, or margins for kitchen design studios?

The kitchen design studio industry is experiencing several shifts in 2025 that affect financial performance.

Revenue growth is moderating, with 40% of studios reporting stable or declining revenues due to increased cost pressures on materials, labor, and rent. Rising interest rates and economic uncertainty have also slowed consumer spending on discretionary home improvement projects, including kitchen remodels.

Studios are focusing more on high-margin consulting services and upselling premium or luxury products to offset lower project volume. Digital and virtual design services are gaining traction, allowing studios to serve clients remotely and reduce overhead costs associated with physical showrooms.

Gross profit margins and fixed costs are under pressure, making operational efficiency and strong supplier partnerships more critical than ever. Studios that can negotiate favorable terms with vendors, streamline project management, and reduce waste are better positioned to maintain profitability in this environment.

Referral-driven growth remains a key strategy, as clients increasingly rely on online reviews and word-of-mouth recommendations when selecting a kitchen design studio. Studios that invest in client satisfaction, follow-up, and reputation management tend to outperform their competitors on both revenue and profit metrics.

It's a key part of what we outline in the kitchen design studio business plan.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.

Sources

1. Dojo Business - Kitchen Design Studio Profitability
2. Dojo Business - Kitchen Design Studio Business Plan
3. Foyr - Profit Margins for Interior Design Businesses
4. MSMV Design - Guide to Pricing Your Kitchen Design Services
5. Kitchen & Bath Design - 2025 Cost of Business Survey
6. Kitchen & Bath Design - Renewed Confidence Reported for 2025
7. Cyncly - Profitable Kitchen Design Business
8. Zip Schedules - Customer Acquisition Cost by Industry
9. Oppein Home - Kitchen Design Profit Margins
10. Houzz - Standard Profit Margin on Kitchen Cabinets