Are you a web designer and ready to take the next step and start your own web design business? You start in the right place by learning about the business start-up process. Starting a business can seem daunting, but it’s not as overwhelming as you think. Just follow a few simple steps to start your web design business.
do some research
First, you need to know the market you are entering. Research other web design companies to see what they offer and the prices they charge. This will help you determine your prices, but it could also reveal an opportunity for a type of web design you can specialize in based on your experience and what’s missing in your market. For example, perhaps you could specialize in designing modern e-commerce websites.
Find a business name
Your name will be the first impression people have of your business, so choose wisely. It should be short and easy to remember, but also reflect what you do. Once you’ve chosen a name, you need to make sure it’s available. You can do a business name search in your state, usually on your Secretary of State’s website. You should also visit the website of the US Patent and Trademark Office to make sure it hasn’t already been filed. You should also search a site like GoDaddy to see if the domain name is available.
Write a business plan
Your business plan should include the following:
- Executive Summary: Brief overview of the entire business plan (write this after writing the rest of the plan)
- Company Overview: Company overview, vision, mission, ownership and goals.
- Products and Services: Describe your web design services.
- Market Analysis: Evaluate industry size and forecasts, as well as web design trends.
- Competitive Analysis: Analyze key competitors and determine your competitive advantage
- Sales and Marketing: Develop sales, marketing and promotional strategies.
- Management Team: Overview of the management team, detailing their roles and experience.
- Operating Plan: Your business operating plan includes how you will provide your services, office location, major business assets and equipment, and other logistical details about how you will run your business.
- Financial Plan: Three years of financial planning, including start-up costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
Choose your business structure
Here are the main options:
- Sole proprietorship – The most common structure for small businesses makes no legal distinction between the business and the owner. All revenue goes to the owner, who is also liable for any debts, losses or liabilities incurred by the business. The owner pays business income taxes on their personal tax return.
- General Partnership – Similar to a sole proprietorship, but for two or more people. Again, the owners keep the profits and are responsible for the losses. Partners pay taxes on their share of business income on their personal tax returns.
- C Corp – In this structure, the business is a separate legal entity and the owner(s) are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The company pays taxes and the owners pay taxes on their dividends, which is sometimes called double taxation.
- Limited Liability Company (LLC) – Combines the features of corporations with those of sole proprietorships or partnerships. Again, owners are not personally liable for debts.
- S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be a corporation or an LLC, which only has to elect to be an S-Corp for tax status. In an S-Corp, income flows directly to shareholders, who pay taxes on their share of business income on their personal tax returns.
Once you have made a decision, you can go ahead and register your business entity with your state.
Obtain an employer identification number
An EIN is required if you have employees or if your business has more than one owner. You can file your EIN online. To visit the IRS website to learn more. Keep in mind that if you chose to be a sole proprietorship, you can simply use your social security number as your EIN.
Obtain business licenses or permits
You may need various state and local business licenses and permits. Check with your local governments for requirements. Go ahead and complete the applications. Small charges may be involved.
Open a business bank account
It’s important to keep your business and personal finances separate, so you should open a business bank account. You will need your EIN to do so.
Obtain trade assurance
Ask your insurance agent what types of insurance they recommend. You will probably need at least the following items:
- General Liability: The most comprehensive type of insurance, acting as a catch-all for many commercial items that require coverage.
- Professional Liability: Protects against claims from a client who says they have suffered a loss due to an error or omission in your work.
Develop your website
You will need a website to market your business. As a web designer, you should be able to do this for very little cost. Just design it like you would for your customers!
Start marketing and earn money!
Start your business by marketing yourself. Use SEO strategies, social media and other digital marketing strategies. Now you are in business!