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How to Start a Web Design Business

12 Min Read

how to start a web design business
Table of Contents
Writing a business plan?

Fast Facts

  • Startup costs: $7,520-$21,250
  • Industry trend: Growing
  • Difficulty: Moderate
  • Profitability: 15-25%
  • Time to build: 2-6 months
  • Commitment: Full-time

Want to translate your web designing skills into a well-proofed business?

Well, the demand for web design services is booming, and there has never been a better time to learn how to start a web design business. 

Whether you are a skilled professional or a seasoned entrepreneur, web designing is a perfect venture to vouch your resources on.

This article offers a perfect guide to answering all your questions regarding what and how to do.

Let’s dive right in.

How much money do you need to start a web design business?

The average cost of starting a website business in the US is between $7,520-$21,250. However, these costs are largely influenced by factors such as location, size, scope of services, and your chosen niche.

Now that you have a fair idea regarding the startup costs, let’s look at the pros and cons of starting a web designing business.

Pros and Cons of Starting a Web Design Business

Starting a web designing business is indeed a rewarding opportunity. However, there are a few disadvantages you must keep in mind.

Pros

  • Low startup costs: Possible to start a company for as low as $1000.
  • High demand: The market has ever-expanding demand ever since the world has turned digital.
  • Scalability: Easy to scale and grow as the resources grow.

Cons

  • Extremely competitive: Thousands of players saturating the marketplace.
  • Constant changes: The market is constantly evolving with new tools and updates making it difficult to keep up.
  • Inconsistent revenue stream: Seasonal fluctuations and inconsistent clientele stream.

Clear with the pros and cons? Now, let’s decode the step-by-step procedure to get started.

A Complete Guide to Starting a Web Design Business

From choosing a niche for your web designing business to registering it and hiring a team- let’s uncover the detailed steps to starting a website business.

1. Choose your web design specialty/ niche

As the first step of setting up a web designing company, determine your niche to set yourself as a distinct entity in the market.

Creating designs for everyone might seem logical, but it is better to have a specific specialty and craft excellence at it.

Here are 2 different ways to navigate your choices while picking a web design niche:

  • Choose a niche that serves a particular locality
  • Choose a niche that caters to specific businesses

For instance, you can establish yourself as a brand that specializes in web design for architectural and design firms. If not, maybe a web design company that caters to the businesses in mid-west Florida regions.

To ensure that the niche you chose is profitable and scalable, conduct an in-depth analysis of your particular niche and its market.

Here are some tools and strategies to explore your chosen niche’s growth potential and profitability:

  • Use Google Trends to gauge market potential and uncover hidden opportunities.
  • Utilize Facebook ads to target specific audiences and gather data on market demand.
  • Explore public data sources like local chambers of commerce and economic development corporations to identify web developer opportunities in specific geographic areas.

By leveraging these tools and strategies, you can make informed decisions and maximize the success of your web designing business.

2. Brainstorm the name of the web design company

It is now time to pick a name for your new web design business. This step is critical as it creates the foundation for your business identity.

Here are a few tips to remember while brainstorming the names for your web design company:

  • Choose a name that reflects your niche and concept.
  • Keep a simple and easy-to-remember name.
  • Avoid using jargon and complex words in your brand name.
  • Check the availability of the domain name before registering the business.
  • Also, choose a DBA name if you register the business with some distinct name.

Seek the opinion of friends and family members before finalizing the business name.

3. Write a web-designing business plan

Of course, you cannot move ahead without a business plan. This living document acts as a guiding map showing you a pathway to start and run your own web design business.

Don’t rush this step. Instead, take some time out and gather all the requisite resources to write a detailed and comprehensive business plan unique to your web designing business.

Wondering the key components you should add to your business plan? Let’s check:

  • Executive summary
  • Company Overview
  • Market and competitor’s analysis
  • Service offerings
  • Operations plan
  • Key management team
  • Marketing and Sales plan
  • Financial plan

Now, don’t make the mistake of assuming that a business plan is essential only if you want to acquire funding. Regardless of whether you need funds or not, a business plan is essential.

Writing your own plan is indeed rewarding. However, it’s taxing and time-consuming, requiring extreme attention to detail.

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4. Register your business

After finalizing the name and conceptualization, it is time to register your business with the state. Registering your business makes your business legally compliant and here are a few steps you need to follow for registration:

Select your business entity

A business entity is the structure of your business that will greatly influence its liabilities, taxation, filing procedures, and state regulations.

Here are a few different entities for you to choose from:

  • Sole proprietorship
  • Partnership
  • LLC (Limited liability Company)
  • Corporation

LLCs and Corporations are suitable forms of business entities that will protect your personal assets against liabilities. Consider the pros and cons of different entities before registering your business.

Register for tax and get your EIN

Also, determine the taxes applicable to your business and register with the state taxation department.

Get your EIN (Employer Identification Number) that will allow you to apply for business credit cards, and bank accounts and file state taxes.

Head over to the IRS website and register for your EIN.

5. Acquire the licenses and permits

Licenses and permits will ensure that your business is totally compliant with the state and federal regulations. Depending on the type of web designing business and its niche, you may need to acquire a variety of licenses.

Here are a few licenses that are common for web designing companies and creative agencies:

  • Zoning permits: Whether you plan to start a home office or set up an actual workplace, you need to acquire essential zoning permits to legally operate an agency at a particular place.
  • Professional license: Some states have a mandatory requirement for getting a professional license. Web designers must acquire the certificate of highest credential in their domain to prove their excellence.
  • Data protection compliance: If the website of your web designing business will collect private data of the people, ensure that you comply with the GDPR data regulations by the government.
  • Copyright and Trademark: If there is a service or product offering that is unique to your business, it is essential to secure intellectual property rights from the beginning.

Identify if there are specific licenses required in your niche. Collect the documents and apply for the essential permits.

6. Get essential insurance

Risks are an inherent part of any business. Your web designing business is no exception.

Identify the areas of risk and insure your business against potential risks to stay bulletproof.

Here are a few insurances you must consider getting for your business:

  • General liability insurance: If there is one insurance, you must definitely get, it is this one. It offers general protection against business, accidents, and personal injuries.
  • Worker’s compensation fund: This is essential if you are hiring people like web designers, administrative employees, and maintenance staff at your creative agency.
  • Professional liability insurance: This insurance will offer coverage against clientele claims for negligence and errors on your part.
  • Cyber liability insurance: Given the digital nature of your business, it is essential to acquire insurance that offers protection against cyberattacks, data breaches, and cyber incidents.

Identify your needs and get started with basic insurance to cover your risks. Later as the business scales, you can get an umbrella insurance to offer all-round protection.

7. Open a business bank account and apply for a credit card

It’s advisable to keep your personal and business accounts separate to avoid risking your personal assets. Moreover, having a separate business bank account will ease the tax filing process in the future.

Remember the Employer Identification Number (EIN) you got while registering the business. Using that EIN you can now open a bank account for business and apply for the credit card.

8. Build your team

So you want to start your own web design business. But hey, you need an army of specialists to deliver web design services at your company.

Begin by hiring only for the most important roles. Initially, it is better to get administrative and marketing tasks outsourced from some other agency or freelancer.

Considering your specialty and the size of service offerings, build a team by hiring for the following roles:

  • Web designer
  • Web developer
  • UI/UX web designer
  • Professional graphic designer
  • Marketing and SEO specialists

Make competent hires by assessing the web design skills of people through a series of tests and interviews.

Consider the payroll load you are capable of undertaking before making the full-time hires.

9. Build your web design business brand

A strong brand is crucial for the success of your web designing business. It not only sets you apart from the competition but also creates a powerful emotional connection with your customers.

Here are a few things you can do now to set the tone of your brand:

Develop a striking logo

Get a freelance web designer to design the logo for your business. If you can’t budget for that, consider using free tools and software to design your own logo.

Pick a slogan

A catchy slogan or tagline plays a vital role in representing your web design business. Ideally, the tagline should highlight your core USP, message, or ideology.

Keep in mind that the tagline needs to be short and catchy. Hire some experts if needed to brainstorm ideas for the slogan.

Establish a consistent design language

A consistent design language will help create a unified brand identity. To achieve this, define typography, colors, space, grid, size, positions, icons, and imagery in one central place, and use them consistently throughout your design system.

The idea is to create identifiable and predictable behaviors in digital product design with your branding. Create a cohesive and visually appealing design language that effectively communicates your brand message and connects with your target market.

10. Determine your pricing structure

Now, it’s time to determine the pricing structure of your web designing business. The idea is to price your services such that at least the business expenses and costs are covered and there remains enough room for profitability.

Here are a few pricing strategies that work perfectly for web-designing businesses:

  • Project pricing
  • Retainer agreements
  • Hourly pricing

Depending on your target audience and various factors such as website size, style, niche, project scope, and additional service offerings, determine your pricing.

Navigate your way through myriads of pricing structures to determine what works for you.

 11. Shortlist and purchase essential software

You need software and web design tools to deliver efficient web design services to your potential clients.

Identify the essential tools that can automate service delivery and enhance the performance of your services. Assess the subscription plans and see what befits your situation the best.

Here are a few tools you must have to build a successful web design business:

  • Project management software
  • Prototyping and wireframing tools
  • Development tools
  • Content management system
  • Accounting software
  • CRM tool

Identify which of these tools can help in business development and make necessary purchases.

12. Create your business website and start marketing

Before you make websites for other businesses, make one for your own business. This is your chance to visually portray your skills amongst the target audience.

Invest the resources to make your own website and include portfolios if available.

Also, this is a perfect time to start working on your marketing strategies. Marketing is crucial to attract new clients, retain existing clients, and increase your reach in the market.

Here are a few marketing tactics to add to your strategy plans:

  • Social media marketing on different social media channels.
  • Email marketing and newsletters.
  • Google ads and Facebook ads
  • Content marketing
  • Video marketing to push educational content
  • Testimonials from existing or former clients
  • Print media if you are planning to target a specific local market

Now, allocate the resources and get started.

13. Automate and scale the business

Start acquiring potential clients for your web designing business. As a web design business owner, you can start seeking projects from your closer circles. These projects can help you build your portfolio to attract new clients.

As the business gains momentum, try and automate as many parts of your small business as possible. This will streamline the service delivery and help you acquire new web design clients.

And that’s pretty much how you get started with a web designing business.

Conclusion

Now that you have all the answers for how to start a web design business, let’s take a step forward. Let us help you write that business plan you have been dreading so much about.

Browse business plan samples of Upmetrics by exploring through our extensive library. Our plans are crafted specifically for small businesses emerging in this thriving industry.

Ready to start? Get our web design business plan sample and use it as a reference point to write your plan.

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About the Author

Vinay                                                       
            Kevadiya

Vinay Kevadiya

Vinay Kevadiya is the founder and CEO of Upmetrics, the #1 business planning software. His ultimate goal with Upmetrics is to revolutionize how entrepreneurs create, manage, and execute their business plans. He enjoys sharing his insights on business planning and other relevant topics through his articles and blog posts. Read more

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