diff --git a/clients/Makefile.am b/clients/Makefile.am
index b64c38a6..d7a6cbf6 100644
--- a/clients/Makefile.am
+++ b/clients/Makefile.am
@@ -48,6 +48,7 @@ noinst_LIBRARIES = libtoytoolkit.a
 AM_CFLAGS = $(GCC_CFLAGS)
 AM_CPPFLAGS =					\
 	-DDATADIR='"$(datadir)"'		\
+	-DBINDIR='"$(bindir)"'			\
 	$(CLIENT_CFLAGS) $(CAIRO_EGL_CFLAGS)
 
 libtoytoolkit_a_SOURCES =			\
diff --git a/clients/desktop-shell.c b/clients/desktop-shell.c
index db415687..a181e3bb 100644
--- a/clients/desktop-shell.c
+++ b/clients/desktop-shell.c
@@ -698,7 +698,7 @@ add_default_launcher(struct desktop *desktop)
 	wl_list_for_each(output, &desktop->outputs, link)
 		panel_add_launcher(output->panel,
 				   DATADIR "/weston/terminal.png",
-				   "/usr/bin/weston-terminal");
+				   BINDIR "/weston-terminal");
 }
 
 int main(int argc, char *argv[])