The Ultimate Guide to Starting a Web Design Business

Thinking of starting a web design business? A lot of questions may arise in your mind to evaluate if website design is the right field for you.

Is website design a profitable business option? Are web designers in high demand? How much can you make as a beginner in the web design industry? How can you establish and run a web design agency?

Are these questions holding you back from pursuing your dream to start a web design business? If so, then you’re in the right place.

Starting a web design business requires many steps, such as finding potential clients, registering your company, deciding on an hourly rate, and handling project management.

In this article, we’ll answer all of your questions about the web design world and guide you through getting started the right way. Read on to find out more about starting a web design company from scratch and making it profitable.

Who Should Consider Starting a Web Design Business and Why?

Starting a website designing company is no cakewalk. It requires diligence, hard work, and passion for web design to set up a design firm.

Have you been working as a web designer for quite a few years? Chances are that you enjoy building websites and want to start your own business.

But it takes more than just being a web designer to start and run a successful web design business. You should have good communication, budgeting, marketing, project management, and design skills to get started.

You need to learn:

How to find and deal with new clients.
How to build websites that best fit the client’s requirements.
How to excel at customer relationship management by delivering the best web design services.
How to plan ahead for the future and make your web design business a success.

Read on for a step-by-step guide to starting a web design business in the US.

Starting a Web Design Business: A Step-by-Step Guide

Starting a web design business is a great idea because of the sheer number of opportunities the industry presents.

The market size of the web design services industry in the US is estimated to be around $11 billion in 2022. Demand for professional web design and development services is at an all-time high.

If you have the required skills but don’t know how to start a business, we’re here to help.

Here is our step-by-step guide to starting a web design business.

Step 1: Develop a Business Plan

Imagine this. You are on the road, and your destination is a town you have never visited. How will you get to your destination?

It’s simple. You use a map, or in today’s times, the GPS on your phone.

When you are starting your own business, your business plan is your GPS. Just like a GPS guides you, a good business plan guides you through the various stages of starting and managing a web design business.

A business plan is essentially a document that defines your company’s objectives and how you will achieve them.

Before creating a business plan, ask yourself the following questions:

What niche do you want to cater to? Picking a well-defined niche early on can help you identify leads that are a good fit for your business.
Will you be working all on your own or do you plan to hire employees?
What location do you want to set up your new company in? How much space do you want to rent?
How much do you want to spend on software, computers, furniture, and so on?
Do you plan to spend on advertising or marketing to generate leads?
Who are your main competitors in the market?
How do you plan to raise funds for your business?
How much do you think you will earn in a month/quarter/year?

The answer to these questions will help you develop a robust business plan. Careful planning is important because a lot of businesses fail in the first year itself.

Now, if you are wondering what a business plan looks like, here is a basic outline.

Patriot

Image via Patriot

Whether you are starting a web design business or a lawn care business, creating a business plan is not a one-time exercise. For running a successful business, you should update your business plan at least once every year.

Step 2: Decide the Services You Will Offer

Once you have determined your business goals and identified your target audience in your business plan, it is time to decide what services you are going to offer.

Do you plan to stick to web design services only? Or, do you want to offer additional services, such as website maintenance or consulting?

It is always a good idea to look for ways to offer more value to your customers.

When starting out it is perfectly okay to offer just web design services, like Proxy.

Image via Proxy

Once you have created a foothold for yourself, you can start offering more services, like Fine And Gray. This agency offers logo and brand design services along with web design.

Image via Finn And Gray

Offering basic services like these is okay when you are getting your business off the ground. Once you have established yourself, you can think about offering multiple services, like Lounge Lizard.

Image via Lounge Lizard

Offering well-rounded service options can make your business an attractive option for clients and investors alike.

If you want to offer multiple services, this is what we recommend you offer:

Web design
Branding
Web development
Managed Hosting
Search Engine Optimization

The above services offer a comprehensive solution to business owners who do not want to worry about technical aspects of managing a website.

However, when starting a web design business, you must consider your niche and your target audience while deciding the services you want to offer. Only offer services that you are 100% sure you can deliver well.

Step 3: Get Your Pricing Right

This may not be an easy thing to think about, especially when you are just starting a web design business, but it is extremely important.

Getting the pricing right is crucial to ensure that your business makes money.

If you charge too high, it may be difficult to find clients. Charging too low means it will take a long time for you to start making profits. In both scenarios, it will be extremely difficult to sustain your web design business.

Here’s what it typically costs to build a website.

Image via Website Builder Expert

You will need to consider all your expenses to ensure that you get your pricing right.

We have a few tips for you to help you offer competitive rates:

Find out what services your competitors are offering and at what prices.
Calculate your business expenses for a month. This should include web hosting, branding and other things needed to maintain your website. You will also need to consider other expenses such as rent, insurance, tax payments, employee-related costs, and so on.
Determine the profit margin you want to achieve. By calculating your costs, you can markup your services to ensure your web design business is profitable.
Try out different pricing models. Depending on what your competitors are charging and how customers perceive your services, you can figure out where you should charge an hourly rate or a per-project rate.
Keep track of your overhead costs. If you bring down your overhead costs, you can make your services more affordable, while earning a profit. You can also consider raising your prices when you scale your business.
Keep testing new pricing plans by offering a combination of services. This will help you sell more of your services, at a higher price.

Step 4: Pick a Name for Your Business

You are starting a web design business, so you obviously need a name for your business. However, picking the right name can be tricky.

Ideally, you’d want a name that is catchy or intriguing so that you can capture your audience’s attention.

Your brand name is crucial for establishing your brand identity. The right name is one of the most valuable assets for your web design business. It can speed up acceptance and drive differentiation.

Whatever brand name you choose, it should fulfill the following criteria:

Meaningful: You may like a quirky, catchy name but ensure that it is relevant to your business and helps your audience associate it with your brand.
Easy: The name you pick should be easy to say, spell, and Google. You may pick a bizarre name, as long as people are able to understand and spell it.
Memorable: The more memorable the name, the better it is for your brand. Ideally, you should pick a name that is unique and stands out from the rest.
Protectable: Pick a name that you can trademark. Also, check if you can get a matching domain name for your chosen business name.
Future-proof: The name you pick for your web design agency should be relevant now as well as in the future.
Visual: You should pick a name that you can easily communicate through design, logos, icons, and colors.

When picking a brand name for your web design business, you can follow strategies used by popular brands.

Hewlett-Packard was named after its founders Bill Hewlett and David Packard. Dell was named after its founder Michael Dell. Many businesses use their founder’s name in the brand name, and you could do the same.
Some companies pick a name that describes what they do, such as Southwest Airlines.
Some companies keep a name that is totally out of context. Case in point, Apple.
Some companies just make up a word for their brand name, such as Pepsi or Google.

The idea is to be creative and pick a name that not only attracts attention but is also easy to remember.

Here are some tips to help you come up with a brand name when starting your web design business.

Image via DesignRush

Step 5: Set Up Your Workspace

Now that you have the basics sorted, it is time to get down to work. How do you pick your workspace? Should you work from your home office or rent a place?

The answer to it depends on your budget.

When starting a web design business, you may want to keep your overhead expenses to a minimum. So, a home office may work best when the budget is tight.

Nevertheless, it is extremely important to have a dedicated space to work. This will ensure that you get the work done without minimum interruptions.

Power or wi-fi outages can negatively affect your web business, especially when you are just building your business. In such cases, you should be open to working from local cafes or libraries to minimize disruptions in your web design business.

You may also consider looking for coworking spaces nearby to ensure your web design business runs as smoothly as possible.

Invest in high-quality hardware and software. You will need reliable tools like a good computer, printer, scanner, and so on. Spending on a good camera is also worthwhile if you plan on taking photos for business websites.

Software for graphic design is also an investment you must consider.

Plenty of entrepreneurs do perfectly fine with a home office. However, you may consider renting an office space if you have outgrown your home office or if you need to hire multiple employees.

Here are a few tips to follow when you are looking for your first office space:

Estimate the size of the workspace you need. Remember, a bigger workspace means a higher rent too.
For a small business, renting an office at a good location can be quite beneficial. Look for an office that is convenient for you, your employees, and your clients. Consider the overall reputation and safety of the area as well.
Have a clear budget in mind. Now, that does not mean that you choose the cheapest office available. Be realistic about what you can afford, and find a good office that is within your budget.
Go through the terms of the office contract thoroughly. Check the fineprint to see details like who’s responsible for the upkeep of the office, including repairs, cleaning, and maintenance. As a small business owner, you should be clear about such things because they can easily eat into your profits.

Step 6: Address Your Legal and Administrative Requirements

When you start your own web design business, it is extremely important to address the legal and administrative requirements as well.

The legal requirements for your business would depend on the kind of company you create and the state you are operating from.

Here are a few things to take care of.

Business Entity

You need to decide what business entity is right for your web design business.

Here are some suitable options when starting a web design business.

Image via The Balance

A Sole Proprietorship is perhaps the easiest and requires the least amount of paperwork. But it does not offer liability protection for your personal assets. If someone sues your web design company, your personal assets will also be at risk.

An LLC on the other hand, limits the liabilities only to your company, and so your personal assets are not at risk.

You can start off as a Sole Proprietorship, and then register as an LLC as your business grows. You can consult a lawyer to figure out what business entity would be best for you.

GovDocFiling can help you register your business and take care of all the paperwork. We’ll even expedite the process and get your business up and running in no time.

Business Licenses and Permits

We recommend that you also check the state and local government websites for business licensing requirements and permits. If you need to register a DBA (Doing Business As), you should look up the requirements for that as well.

Bookkeeping

Bookkeeping is an important task for a small business owner. After all, you have to manage your own payments and taxes.

Being up-to-date on all your financial transactions can save you from tax penalties. Moreover, when you monitor your expenses closely, it also prevents overspending.

There are many bookkeeping software available in the market that can be easily linked to your bank account. You can use them to automatically track and manage your expenses, and also for creating and managing customer invoices.

Hiring

As your web design business grows, you can always think about hiring an accountant for your company. You may also need to hire employees or freelancers for smaller projects when you scale your business.

Insurance

It is always a good idea to invest in Professional Liability Insurance when starting a web design business. You should also consider investing in other types of insurance such as Business Income Coverage, Data Breach Insurance, and so on.

Step 7: Create a Business Website

All successful businesses have great websites. Without a website, people may start questioning the legitimacy of your web design business.

Being a web designer yourself, building your own design business website should not be a challenge.

Designing a great website gives you an opportunity to win over prospective clients by showcasing your expertise and design skills. After all, you can’t be a good website designer if your own website is poorly designed.

Here are a few tips to get design an amazing website.

Focus on Visual Appeal

Your business website is basically your portfolio and has to do most of the heavy-lifting to showcase your expertise as a web designer. Create a website that your clients would want for their businesses. Nothing can help you gain their trust better.

Spinx and Digital Silk are two successful web design companies in the US. You can take pointers from their websites.

Spinx

Image via Spinx

Image via Digital Silk

Pay Attention to the Content

Ensure to use high-quality content on your website. There should be absolutely no errors or you would be giving your customers a chance to doubt your abilities as a web designer.

Use content that adds value, and if you are using images, ensure they are of very good quality.

Include Testimonials

Do you check online reviews when researching companies? Well, your customers do too.

Positive reviews and testimonials could work wonders for your business. So, after completing a project, don’t forget to ask your clients for a testimonial.

Display the testimonials clearly on your website. They will help dispel any doubts new clients may have about hiring your services.

Optimize for SEO

Starting a web design business transforms you from a web designer to a business owner. Therefore, you have responsibilities other than building websites, and one of those is looking for new clients.

Optimizing your website for SEO can help your website rank higher on Google SERP, which can help more people discover your website. The more visible your website is, the more leads you can generate for your web design business.

Automate the Prospecting Process

Adopting SEO best practices means that your website will appear more in organic searches, helping you generate more leads. Consider automating the prospecting process.

You can add a lead-capturing form on your website. You can use a lead magnet to attract more people by promising something valuable.

Here is an example.

Image via Artful Teaching

You can take it one step further by adding scheduling software to your website. This will allow your prospects to schedule a time to have a discussion with you, instead of having to go back and forth over email with them.

Step 8: Create a Distinct Brand

Your branding is just as important as your business website.It will make marketing your web design business a lot easier when you have clear and consistent branding from the start.

Here’s what you need.

Logo

A logo grabs attention, creates a positive first impression, and is quite easily the foundation of your brand identity. You can use it on your website, social media pages, business cards, and so on.

Make your own logo or have a professional graphic designer make one for you.

Web design company Lounge Lizard has a Lizard for their logo, and they use it on their website as well as on their social media accounts.

Image via Instagram

Color Guide

Brands have successfully used colors to craft a brand identity for themselves. Pizza Hut, KFC, and McDonald’s prominently use the color red.

The Starbucks mermaid is green.

Image via Wikipedia

You can choose a couple of colors to represent your brand identity. You can use these colors on your website, marketing materials, and so much more.

Slogan

Slogans and taglines attract attention. They can help differentiate your brand and play a key role in brand positioning.

Here is an example.

Image via Big Drop

You should also consider having a slogan for your web design business that is simple but catchy.

Voice

Using a positive tone of voice can help customers emotionally connect to your brand. Your brand voice should represent your company’s values, style, and strengths.

Nike is an excellent example of a brand using a positive voice as its brand identity.

Image via Instagram

You should ensure consistency in the voice of all your brand messaging.

Step 9: Promote Your Business

You have a great name and a fantastic website for your business. You have also got the branding right. It is now time to let people know about your new business.

Here are a few tips to promote your new business:

Create a profile on Google My Business, Yelp, and other local directories to attract local traffic to your website.
Promote your business on social media platforms.We recommend creating a separate business page for your brand on platforms like Linkedin and Facebook.
Use video marketing, email marketing, content marketing, and more to highlight your expertise and give your brand extra mileage. Having the right marketing strategy is crucial for your business to succeed.
Invest in customer relationship management software to automate business processes like data entry, standard communications, and more to deliver an outstanding customer experience. Great customer service makes happy customers. There is no better brand advocate than a happy customer.
SEO can also be a great way to promote your website and get more customers.

Do you want to promote your business for free? Here are a few tips to do so when you don’t want to spend money.

Image via Pinterest

Step 10: Grow Your Business

There is no denying that you need a combination of tenacity and strategic thinking to scale your one-person operation into a full-fledged, successful business.

Here are some expert tips to starting a web design business that is sustainable in the long run.

Take on as much workload as possible to test your limits. Use that as a catalyst for growth.
Provide outstanding customer service that people won’t forget. It can help you get more referrals and repeat business.
Use blogs, webinars, and social media groups to establish yourself as an industry expert. If your blog posts or webinars offer value, they are bound to attract new customers.
Being customer-centric and developing packages and services tailored to their individual needs can help your business grow.
If you want to have a successful web design business, focus on becoming a specialist rather than a generalist. Being an expert in a specific niche, such as ecommerce or fashion, can help you establish a loyal customer base.
Hire the right people. Getting the right people onboard reduces the need to hire again and again and contributes to your overall business success.
Never undermine the importance of marketing. Every business is unique. Figure out what marketing strategy works for you, and use that to grow your web design business.

Time management, productivity, and efficiency are essential to growing your business.

Set up a system in place to improve productivity and manage your time better. Embracing time management best practices can help you make the most of your day.

Here are some tips to ace your day-to-day tasks when you start your own web design business.

Use software or set up a system to track the time spent on each task.
Migrate daily tracking information into a reporting format. This will help when creating invoices for your clients.
Set up checklists, processes, and strategies for building a new website.
Create templates for contracts, proposals, and commonly sent emails. Keep a few email templates handy for email marketing.

Things to Do Before Quitting Your Job to Start a Web Design Business

When you’re getting started with your web design business idea, you’ll be spending most of your time finding potential clients and negotiating with them. You’ll hardly be doing any actual website design and development work.

If you’re currently working as a full-time web designer, you should build up at least a few months of emergency funds before quitting your job. You should utilize this time to complete the groundwork for your new business.

You can use this time to:

Choose a name for your web design business and buy a domain.
Build a portfolio website for your new venture showcasing your design skills and the web design projects you’ve worked on. Your business website should be simple yet impressive and help your target audience understand what you can do for them.
Look for potential clients and start offering freelance web design services to them. You may have to sacrifice your fun evenings and weekends to do this but, trust us, it will be worth it. You will be able to build a solid portfolio website while earning a side income.
Create proposal templates to pitch your web design services to new clients.
Create social media profiles for your web design business. You should keep the bio, profile picture, cover photo, and contact details consistent across social media channels. Also, make sure that the social media branding you do is relevant to your business.
Design and start giving out your business cards when you meet people during events, summits, or other professional gatherings.
This can also be a great time to develop your thought leadership by contributing to high-authority web design and WordPress blogs. It will help potential clients find you and your web design services.

As you’re already making money as a freelance web designer, getting started will become easier. Let’s find out what you need to do next to launch a full-fledged web design business.

Creating a Business Plan for Your New Web Design Business

It’s time to make the transition from being a freelance web designer to a web design business owner. You may have to face a lot of challenges, be more accountable, and manage numerous things at once.

Most successful businesses start with a well-documented business plan. You should plan ahead and determine:

Who is your target audience? They can be small business owners, bloggers, influencers, other web designers, and design companies.
What is your niche? There are various types of web designers. Some are skilled at UI/UX while others have excellent backend development skills.

You can also define your niche by the coding languages and content management systems (CMS) you’ll build websites in. Some of the possible options include WordPress, Magento, PHP, and Squarespace.

Which business structure should you choose to register your web design business? You can form a Sole Proprietorship, a Partnership, a Limited Liability Company (LLC), or a Corporation to get started.

What’s your marketing plan to promote your web design services and attract clients?

Which web design services will you offer? Will you build websites from scratch or convert PSDs to WordPress and other platforms?

Will you also offer services other than web design? Many web design businesses offer content writing, SEO, graphic design, and social media management services as well to provide a complete package to their clients.

How much will you charge clients? You can fix an hourly rate or create specific web design packages for individuals, startups, small businesses, and big corporations.
Will you start as a solopreneur? If not, how many web designers will you hire at the onset of your business? Will you also hire a dedicated web developer?

Registering Your Web Design Business with the Federal and State Governments

Regardless of the business structure you choose, you will have to complete the state filing requirements and submit the necessary legal documents. This is important to make sure that your web design business is legally compliant and you’re authorized to offer services to clients.

Along with completing state filing, you will also have to file for a federal Employer Identification Number (EIN)/Tax ID for your business. You’ll need this nine-digit number to file your business taxes, hire web designers and other employees, open a business bank account, and more.

Registering your new business and completing all of the paperwork all by yourself may seem overwhelming. We’ve simplified the process for new business owners by offering complete business formation packages, starting from $195.

Our packages include state and federal filing fees, five legal documents, a business start-up guide, and up to $3,000 of potential savings. We also offer expedited application processing at no additional cost.

FAQs

1. Is web designing a profitable business?

A. Yes, web designing is a highly-sought after business as every business that wants to start a website needs the help of a web designer. It is one of the businesses that will never go out of demand and will always be needed.

The average annual salary of a web designer is $70,000 and it can go a lot higher. So, it’s a lucrative career option in monetary terms as well.

2. What is the process for starting a web design business?

A. Here is the step-by-step process for starting a web design business:

Create a business plan
Choose your services and pricing
Choose a business name
Set up a workspace and buy necessary tools
Register your new business
Take care of other legal requirements
Build your own website
Build a unique brand identity
Promote and grow your business

3. Who should start a web design business?

A. Anyone who has web development skills and expertise in multiple web building platforms like WordPress and Wix can start a web design business. You can start as a sole proprietor and add more web designers to your team as your business grows.

Alternatively, you can start a web design business simply by hiring a team of web designers, without having much experience yourself. But you do need to possess excellent business skills like communication, client management, sales, and more.

4. Which business structure is best for starting a web design business?

A. If you want complete control over your business and want to start by offering your services, you can start a sole proprietorship. As your business grows, you can hire more employees, but still retain complete ownership.

However, a sole proprietorship does not offer any liability protection. So, if you want to protect your personal assets from business losses then an LLC is the best option.

Corporations provide the best legal protection but are suited for large organizations. So, you can start with a sole proprietorship or an LLC and switch to a corporation when you plan to expand and grow your web design business.

5. How can GovDocFiling help me with starting a web design business?

A. GovDocFiling provides affordable, efficient, and hassle-free business formation services. Whether you want to obtain an EIN or file for a DBA (doing business as), we can take care of the paperwork and legal hassles and get things done on time. Use our services to get things done quickly while freeing up your time for more important tasks.

Are You Ready to Start a Web Design Business?

When starting a business, you are likely to do everything you can to take on as many web design projects as you can.

The steps to starting a web design business that we’ve covered above will help you set yourself up for success. However, we also suggest that you set up and follow a work schedule for yourself.

Creating boundaries will help you balance your work and life, foster a happier and more productive work environment, and take your web design business to greater heights.

Do you have questions about starting a web design company? Share your thoughts in the comments below. We’ll be happy to help you get started.