Design Domination Podcast Episode #119: How to Start a Freelance Graphic Design Business: Complete Guide

Music: https://www.bensound.com

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In this episode of Design Domination, I’m getting into what you need to think about and what you need to do to start a freelance graphic design business. If you already have your own creative business, you may still get some good business tips. Stick around to get business tips, including legal and financial considerations, insurance and marketing and other tips.

A lot of graphic designers have asked me, and I’ve seen a lot of them asking online: what do they need to do, how do they start a freelance graphic design business.

To give you a bit of background, I actually started my business before I went full time in it. I worked a full-time job and freelanced for seven years before going out on my own full time. So it doesn’t have to be something where you flip a switch from full-time employee to full-time freelancer.

Step 1: Create Your Branding for Your Freelance Graphic Design Business

Let’s start with the fun stuff, creating your branding.

Business Name

The first thing to think about is your business name. Will you use your personal name or create a business name?

Now, you don’t have to create a business name to go into business for yourself, but it’s definitely something to think about.

I actually used my personal name at first, then I called my business something else before settling on Gratzer Graphics in the early 2000s.

It’s definitely helpful to think about early on because you want to make sure of a few things:

• that the domain is available,
• that the social media handles are available,
• that the business name you want to use is not already registered as a business or trademarked.

You want things to be named as consistently as possible across all platforms.

I went into a lot of detail and gave lots of tips for naming your freelance graphic design business in episode 68.

Logo and Typography

You’ll also want to design a logo and in all the various print and web formats. It’s going to be on all your marketing materials and social media accounts.

You may also want to choose typefaces that you can use in your print or PDF marketing materials and on your website. So you might consider open source fonts such as Google Fonts, which you can download and use online.

Otherwise, you can purchase web versions of fonts, if they’re available for that typeface, or find similar ones to use for the web.

Business Cards

You’ll need business cards—yes, printed business cards. They don’t have to be professionally printed at first. They could just be done on perforated business card paper that you print out on your home office printer.

You can hand them out at in-person meetings and networking events. But you can also mail them out with thank you cards or other correspondence.

It only helps you if clients have a tangible piece on hand. Plus, it’s also a way to stand out from other graphic designers, who no longer see the need for the business card.

Letterhead

You’ll need to design letterhead, which you can also use for your invoices, proposals and estimates, unless you’re going to pay for project management or proposal software, in which case you’re usually only able to upload a logo and modify fonts and colors.

Labels, Envelopes and Cards

This might seem minor, but I think it’s something to consider for sure—labels, envelopes and cards.

I like to send out thank you cards to not only potential clients after sending them a proposal but also to people who’ve referred clients. I also sometimes send checks with notes in the mail to subcontractors.

People really appreciate the extra time spent on sending a card. So it can have a lot of impact and make you more memorable. That makes clients more likely to contact you again, and subcontractors more likely to help you in the future. They all feel appreciated.

For labels, I buy the Avery labels that I can just print off as I need. They have templates you can download to set them up. But I just measure where they fall on the sheet and set up my InDesign file accordingly.

For envelopes, I use lime green envelopes that match my green brand color, instead of using white, so that they stand out in the mail.

Step 2: Create Your Website for Your Freelance Design Business

You’ll want to get your website up and make sure it’s always available to attract your potential clients.

In the very beginning, just set a page up with a few portfolio pieces and contact information. After that, you can spend more time on it. You don’t want to spend months perfecting your website design, which will just prevent you from taking action and getting clients.

Website Design

As soon as you can after that, make sure the design appeals to the potential clients you’re looking to attract. If you’re looking to attract legal and financial businesses, for example, the website design would have a different look compared to if you’re targeting crafters.

If you’re new to the graphic design world and you’re not yet at a point where you know who you want to work with or what industries you want to work with, then once you figure that out, you can modify your website to reflect that.

Portfolio

You want to show the types of work that you want to get and also show good work. Bad work will dilute the perceived quality of your work. It will also make it look like the quality of your work is inconsistent. Prospects may wonder if it will be a crap shoot getting quality work for their project.

You’ll want to include testimonials from prior clients you’ve worked with. If you haven’t had any clients before, then get testimonials from people you’ve worked with at your job—any comments that can speak to your design work, experience working with you or the results from the work.

Domain names

You’ll want to buy a domain name that is easy to remember. I like NameCheap for buying domains. You may want to buy more than one domain name extension, such as .com, .net, etc.

You’ll also want to set it to auto-renew, so it doesn’t expire and you risk losing it. Someone could swipe it up and then charge big bucks selling it.

Web hosting

You’ll want a reliable web host with good uptime and support.

I like Pair, WP Engine and A2. There’s also Siteground and Flywheel, among others.

Legal

You’ll want to include some legalese in the footer:

• The word “Copyright” and the year to give notice about your intellectual property,
• A linked terms of use page and
• A linked privacy policy page.

I talked about terms of use and privacy policies with Hans and Donata from Termageddon in episode 83.

E-mail list signup

If you can do this sooner rather than later, create an e-mail signup form, so you can start collecting e-mail addresses and building your list. You can then easily let prospects know when you’ve added a blog post or work to your site.

This keeps you top of mind, even if they don’t open or read your e-mail. They will see your name in their inbox.

The best way to get an e-mail address is to trade something of value for it, such as a lead magnet, which could be a free guide with tips that they might be interested in.

Some e-mail services offer a free account up to a certain amount of e-mail addresses.

I used MailChimp a long time ago. I’ve been using MailerLite for the past four years. I find it really easy to use.

There are more complex ones such as Active Campaign, which I’ve also used, but if you’re new to building your list and looking for something easy, I definitely recommend MailerLite.

Search engine optimization

I talked about the next few points in episode 52 in more detail, but you’ll want to optimize the SEO of your website to increase the chances of being found by prospects when looking for the types of services you provide.

Mobile-friendliness

Make darn sure your website is responsive and mobile friendly. Many potential clients may be viewing your site on a tablet or phone. If they have to pinch and pan or scroll to get around your website, that won’t be a good user experience. If you do web design, they may wonder if you would create a site that way for them.

Site speed

You’ll want to make sure your website loads quickly, so that potential clients don’t get frustrated or leave your site waiting for it to load.

You can check this with GTmetrix and Pingdom.

For more details about what to include on your website, check out episode 52 on what designers need to put on their website and in their portfolio.

Step 3: Set Up Your Social Media Accounts for Your Freelance Design Business

Now onto social media accounts. You’ll want to set up social media accounts wherever your potential clients are.

They may more heavily use one platform over another.

Be sure all of your account images and post images look consistent, so you look professional and memorable.

Also, it’s showing you practice what you preach. If you tell clients their branding should be consistent, then yours should be too.

Step 4: Choose a Legal Business Entity for Your Freelance Design Business

OK, now for some of the not-so-fun but very important stuff to think about when creating your freelance business.

Disclaimer: I am not a lawyer or accountant, nor do I play one on the podcast. You should always consult a lawyer and accountant about your specific needs.

First, please understand that even if it’s just you as a freelancer and you’re using your personal name, you are still acting as a business.

So you may want to consider—at this point or in the future—creating a separate business identity whether you use your personal name or a different name for your business.

The reason for this is because forming a business separates your personal assets (house, car, etc.) from the business assets. It can provide protection in case you make an error in your work and someone comes after you.

But besides that, some potential clients may take you more seriously. It shows you think of yourself as a business, that you’ve made an investment for the long term and that you’re not a fly-by-night freelancer.

LLC

The most popular option is the limited liability company (LLC).

If you’re the only owner in the LLC, then you’d be a single-member LLC (what my business is).

For tax purposes, you’re seen as a disregarded entity. That means you file a personal tax return with your income on there.

You also file a personal property return, which is a misnomer, because that’s actually for your business. Your state usually charges an annual fee when you file this at tax time. In Maryland, I pay $300 per year.

You can form an LLC yourself or with the help of Legal Zoom or a lawyer. It’s typically not very expensive to do.

Forming an LLC in certain states may be cheaper. I have a few colleagues who have formed an LLC in Delaware rather than in their home state because it was cheaper or provided more benefits for whatever reason.

Incorporation

Another option is incorporation. I am not as familiar with incorporation as I am with an LLC, since I’ve had an LLC since 2003. But from what I understand, incorporating can cost more. There is also more paperwork involved apparently, which I believe has to be done throughout the year.

Business License

Depending on where you live, you may need to get a business license in order to conduct business. In the United States, this can vary from state to state.

Tax ID (EIN)

It’s also a good idea to get a separate tax ID number for your business. Clients will often send you a W-9 form (in the United States), which is a formal request for your tax identification number.

It can be uncomfortable sharing your Social Security number all the time. It also can be a security risk.

Clients will usually ask you to email back the filled out and signed W-9 form, and you might not think anything of it. But email is not secure. So you don’t want to be emailing your Social Security number all over the place.

To get a separate tax ID for your business, you would need to apply for an EIN, which stands for Employer Identification Number. Then you would use that instead of your Social Security number when filling out W-9s.

Bank accounts and credit card

It’s good to have a separate bank account and credit card for business purposes. If you form a business entity, you will want to have them in your business name.

This also applies to any Paypal, Stripe, Wise or Payoneer accounts you may open as a business as well.

Contracts

You’ll want to create a contract. If you are offering graphic design, you may need only one contract. If you’re also offering web design, which involves a lot of other components, you may want to have a contract with additional terms.

I highly recommend investing in the services of a lawyer who understands design and intellectual property law to review your contractual terms in the beginning. That way, you’ll have peace of mind and protect yourself.

I talked about contracts (and estimates) in episode 13.

Step 5: Get Insurance for Your Freelance Design Business

You’ll also want to consider insurance—a few types.

E&O

One type is E&O, which stands for errors and omissions. It is also known as professional liability insurance. Although rare, some clients may require you to have it.

It may pay for the cost of a professional mistake, like if you made a mistake in a printed piece and it needed to be reprinted.

It is recommended that you not let E&O coverage lapse, so that you have continued protection. You may not be protected otherwise. I don’t know if you wouldn’t be covered for work you created during that lapse or if a claim was made at that time.

I get E&O insurance for $38 a month through Freelancers Union. I used to pay 10 times more for the same HISCOX policy through an insurance broker.

CGL

The other type of insurance is CGL or commercial general liability insurance.

If something were to happen to your computer equipment as the result of theft, fire, flood, hurricane or something, this insurance would be for that purpose.

Your renter’s or homeowner’s insurance may not cover equipment for business use, including freelancing. So be sure to check with your insurance carrier. It’s usually cheaper to get this type of insurance through them too.

It may also cover a financial loss if, say, a client comes to your home and trips and falls and gets injured and comes after you.

Check with them and you can also learn more in episode 56, where I talked about how to protect your freelance business from disaster.

Medical insurance

Medical insurance is something to consider if you’re going to be leaving a full-time job with benefits and don’t have insurance through a family member or spouse.

I covered various options for this in episode 56.

Backups

Backups are a different type of insurance.

Backups make sure you can work in case your computer equipment has a mechanical issue, gets stolen or something happens to it from a disaster.

You can back up to the cloud, but then you are reliant on an internet connection. With external hard drives, you don’t have to worry about that. You can even back up to both.

Whatever you do, just don’t skimp on backups!

Step 6: Figure Out the Financials for Your Freelance Design Business

The next thing you need to do is figure out the financials.

That includes the cost of all of the things I have mentioned so far and quite a few others that I will mention. You may want to put them into two buckets: one-time investment (such as forming an LLC) and ongoing expenses.

Business expenses

Ongoing expenses would be your Adobe CC subscription and E&O premiums. It may also be software for project management and for creating proposals, estimates and invoices.

You need to understand how much it costs you to just be in business.

Don’t forget about taxes. If you’re in the United States, you will want to pay estimated quarterly taxes, so that you don’t end up owing them all at once and you want to avoid penalties.

Pricing

You’ll need to have an idea of what your pricing should be to make sure that you cover all of your business expenses, pay yourself and have profit left over.

If you’re trying to decide when to make the move from a full-time job to full-time freelancing, you’ll need to consider that a lot of your time will be spent managing the business and marketing.

You won’t be working eight hours a day on design work, and you may have some expenses that you didn’t have as an employee. So your rate will need to compensate for that. It should be higher than your hourly rate as an employee.

Step 7: Network and Market Your Services as a Graphic Designer

Of course, you’ll also now want to get out there and let people know about you.

LinkedIn networking

Make sure you are on LinkedIn and that your profile is up to date and shows some work samples.

I had a talk with LinkedIn expert Brynne Tillman about how designers can optimize their LinkedIn profiles in episode 22. Be sure to check that out.

Job boards

You can also check out job boards for businesses looking for freelancers or subcontractors.

Upwork

There’s also Upwork. I did an entire episode on Upwork tips.

Blog, social media and e-mail

You can also regularly post content to your blog, social media accounts and e-mail list.

I will post the entire piece on the blog, then I will have social media images that are teasers, which then lead to the blog page to read the full article.

In the e-mails I sent out, I put the image and only the first paragraph or a lead-in as to why they need to know about what I just wrote and link to the full article.

I will also sometimes include a new piece of work added to the portfolio and have it continue to that page.

The purpose of doing it that way is to get them to your website. The purpose of posting and sending out the e-mail is to keep you top of mind and to also demonstrate your expertise.

Conclusion

I hope this information has been helpful to you. If it was, would you do me a favor?

Help me out by sharing this content to help me reach more designers. I’m really trying to grow my audience.

Please comment on the episode page.