How to Start a Web Design Business in 2022: A Beginner's Guide

The demand for professional web design and development has never been higher.

If you’re tired of being a freelance web designer and want to start your own web design business, there’s nothing standing in your way.

We’ve got advice on how to start a web design business from the ground up, and the benefits of starting one. This article will help set you up to start a web design company of your own.

Starting a web design business in five easy steps

Starting your own web designing company requires a lot of time and hard work. Use the tips below as guidance to make informed decisions to grow your business:

Step 1. Create a solid business plan

A business plan should set down the foundation of any enterprise. And the same thing also applies to the web design business, so it’s best to start with one.

Your business plan should contain:

An executive summary
A market analysis
Short and long term goals
A list of your services
Potential clients
Cost and pricing estimations

Let’s break down these parts one by one.

Firstly, start with an executive summary. It comprises your brand’s vision, mission, and general information about your web design services.

If you plan on building an agency, this is how you’ll include the structure of your organization as well.

Why is having an executive summary important? Well, for one, it helps you outline the purpose of your business and start to steer it in the right direction for development.

Should your business scale, you can also use the summary to explain your business features to investors.

Secondly, identify, research, and analyze your target market early on. Narrowing down your targeted potential clients is how you’ll make a marketing strategy to grow successfully.

To help segment your customer bases, take a look at your services and identify who might benefit from them.

To understand your clients, you can create a buyer persona using quantitative data like age, income, and gender as well as qualitative ones like lifestyle, interests, and setbacks.

While you’re at it, research what services your competition offers, and how they market their web designing business to clients.

You’ll not only gain insights on effective marketing strategies but also tips on market segments and trends still untapped by competitors. Get started with tools like:

Now with the above outlines in mind, you can start a list including short and long-term targets for the development of your web design business.

Your list has to be specific, measurable, achievable, timely, but also challenging.

Having clear targets will set the course for your design business, including financing and pricing. You need to estimate how much to spend, and how much time before starting to break even.

Decide whether to charge clients a flat rate or an hourly one

A flat rate charges your clients on a project basis while an hourly rate charges clients for the amount of time it takes to create their website.
A project-based billing system lets your clients know upfront what they’re paying for, and is good for short-term work.
Meanwhile, time-based billing is harder to estimate but is good for longer-term projects.

Whichever your choice, consider the project management requirements and the value of the services your web design business offers.

There are plenty of resources out there to help you get started with financial planning and pricing.

These business calculators and this freelance rate calculator are two such examples. This FreshBooks’ guide also offers tips on how to set your price for your design services.

If you’re unsure how to structure these elements, consider using business plan templates like Business Model Canvas.

Transitioning from full-time employment to starting your own design company can be challenging. Starting with the right preparation helps. Here are some tips on how to prepare:

Funding offers

The first thing you need to prepare is financing.

Have at least 6-12 months of savings before you quit your job. That way, you’ll have the means to cover living and emergency expenses while starting a web design business of your own.

Consider taking business loans. In general, these are the most common ones you might need:

Line-of-credit loans – this type of loan works like a credit card, so you can withdraw money up to a specific amount at any time.

You pay interest only for the amount of money you’ve borrowed. These loans can be given by banks or online lenders, and the requirements vary.
Peer-to-peer loans – unsecured loans between individuals, usually arranged through offers on online networks.

They’re unsecured because the loans are not backed up by any collateral, and the interest rates can be rather high.

Requirements differ between lenders. These loans are typically short term, and repayment is scheduled accordingly.
Microloans – The requirements are typically less strict, due to the small amount of money lent.

These are suitable for starting a small web development business. Repayments are usually scheduled for a couple of years.
Personal loans – If you have good personal credit ratings, taking a personal loan from a bank is doable, especially if other forms of financing are not available.
Other loans – as an alternative, you can always borrow from your family and friends.

Most likely, it’s going to be very flexible, because you can repay at your own leisure with no interest or deadline. Just make sure to pay them as soon as you can.

Keep in mind that you probably won’t have any assets as collateral when you’re starting a web design business. So you might only be eligible for unsecured loans.

However, you can check whether your business is eligible for a loan or collateral by the local government associations (such as the U.S. Small Business Administration).

Portfolio and business website

Next, build your portfolio.

A solid portfolio shows a client your skills, experience, and accomplishments so they know what to expect from your design business.

If you have no prior experience or past projects to showcase, it’s never too late to start. Start off by doing personal projects, volunteering free work to clients, or offer services for friends and family.

Once you have enough work to showcase, display it on your portfolio website.

Building one from scratch is another great way to show clients your web design skills. As an extension of your marketing, it should build a strong case of why people should hire you.

If you need tips on how to get started, you can turn to selections curated by graphic design and website designing companies like Awwwards or Behance.

Ensure your website has the best visuals and user experience to convince potential clients
Keep the design on point but easy to navigate
If you dabble with more than one genre or design format, you can divide them into sections so they’re easy to find

Paying attention to your website’s SEO will also help your design business grow.

Since 75% of users focus their research on the first page of results, ranking high on search engine results pages means more exposure for your site and business.

Your portfolio site can also work as a business landing page:

When writing compelling copy, be clear on what you’ll offer a client, how much you charge, and ways to contact you. Instead of sharing your email address, consider an email contact form.
As well as describing your design business, briefly explain your background and interests. That way, your prospective clients can get a glimpse of who you are as a person.
You can also give the website more personal touches by incorporating your brand logo, tagline, and a picture of yourself.

Businesses can personalize their website further with a custom domain name. It can help build your brand identity, and be used in your email address.

Domains have to be catchy, brand-representative, and unique. To check whether your desired domain name is available, you can use Zyro’s domain checker for free.

Last but not least, prepare your site for clients by integrating a payment gateway.

Consider the network’s security, processing fees, transaction process, and customer support when selecting your options.

For better client experience, use payment options that are internationally available. This way, you can expand your design business to a foreign client base easily.

Some reputable payment processors worth considering include:

They offer reliable and secure billing methods for online businesses.

Branding, networking, and content

Once your portfolio website is ready for business, you can start adding content to maximize its exposure. Many businesses have blogs integrated as its component for a good reason.

Get started by writing useful and relevant content about web design and related fields.

This way, you can establish yourself as an authority on the subject, and begin to build your credibility in the eyes of a prospective client.

Getting involved in the creation of industry-related content is also an opportunity for networking and branding. You can reach out to relevant websites and offer to guest post for them.

Why is this beneficial?

Your design business might share a common target audience with similar blogs or websites. Your site can benefit from their share of traffic, increasing the likelihood of getting a client.

When pitching for guest posting, make sure to follow your host’s guidelines. Make your pitch email as compelling as possible, but don’t be pushy.
Research your target websites or blogs beforehand. You’ll build familiarity with their brand voice and thus can personalize your pitch.
Once you’ve scored a deal, you can start writing. Don’t forget including the link to your business website, either in the bio or as an anchor text within the article.

If writing just isn’t your thing, you can still build your brand’s visibility by actively participating in your industry’s conversation.

Go to web design or IT-related websites and comment on their posts. Get your voice heard by adding insights into industry discussions or forums. Share your email address to build contacts.

Another great way how to establish thought leadership is to utilize social media.

Create a dedicated account or a page for your business. Businesses tend to look more professional that way.

You can use the medium not only to promote your business and connect with your audience but also to share your thoughts on industry topics, and build relationships with related businesses.

Join relevant Facebook groups or participate in TweetReports chats to exchange ideas and knowledge with experts.

Doing this will also keep you updated on relevant industry trends and happenings.

Don’t stop on online networking.

You can take it one step further by mingling with offline communities of web designers and small business owners.

Meetup is a great platform to find and create local events related to your niche.

Step 3. Sharpen your skills, pick your tools, specialize

Web development is a broad field with many branches of specialization.

While being a jack-of-all-trades sounds good, focusing on certain areas is so much more practical. Not only is it easier to market, but it also positions you as an expert in the industry.

When starting a web design company, think about how you’re going to build up a specialization.

When you pick a niche, you get to understand the ins and outs of your clients’ web design needs more thoroughly. It will save you time and energy in producing top-notch results.

For example, you can focus on a specific type of web design or industry, like eCommerce sites, or photography websites for example.

You can also convert sites built on a website builder to another platform, or offer additional services like web maintenance.

The point is, play around with several niches until you find the combination that works for you. You can use this comprehensive list to get started.

Regardless of your specialization, though, there are some general skills that all web designers should have and constantly build on.

Besides mastering web development languages like HTML, CSS, and JavaScript, web designers must possess visual design and user experience (UX) skills.
Having a strong sense of aesthetics will also be beneficial for one’s career in this field.
Soft skills like time management, project management, and communication skills are also important.
Take courses, join webinars to hone your professional and interpersonal skills. After all, in this highly competitive industry, web designers are expected to be more proactive.
A website designer must master graphic design software like Adobe Photoshop and Adobe Illustrator.
For prototyping a web design, consider using tools including Eagle, InVision, FlowMapp, and Sketch.

Looking for web-design resources? Try Textures, MyFonts, and Subtle Patterns.

Since many websites incorporate videos in their layout, knowing how to use graphic video processing and animation software like Adobe After Effects and Adobe Animate can also be useful.

Depending on your niche and requirements, the software you need might vary. It’s also a question of which options are the most cost-efficient for you.

The next thing you should evaluate is whether your existing hardware is capable of handling your workload.

Chances are, you will need a bigger monitor, better computer, and other miscellaneous tools like scanners and printers. Or, a better camera if you’re providing photos as a service.

Finally, have a backup plan ready should anything happen to your equipment and data.

Don’t throw away your old laptop or PC just yet, so you’ll have a spare if the one you’re using now is broken or stolen.

And have your data backed up in the cloud and other devices as well. Carbonite, Backblaze, and CrashPlan are three well-known names of cloud-based backup services you can use.

Be sure you’re including software and hardware costs in your financial plan when starting a web design company.

Step 4. Take care of the legal and administrative matters

Formalizing your business means that you have to comply with regulations and authorities. Some of the legal and administrative aspects you must consider are:

Business identity

Since you’re creating a website designing company, you need to register it and pay income taxes.

There are two ways to go about this. You can register as a sole trader or a limited liability company (LLC). Both have their own pros and cons.

While registering for sole ownership is significantly easier, you’re treated as the same entity as your business. When someone sues your company, you risk losing personal assets too.

Meanwhile, with LLC you can limit the liabilities exclusively to your company.

That way, you won’t lose everything should you need to pay a business debt. However, the cost of running an LLC is higher than that of sole ownership.

Web designers typically start off as a sole trader and register as an LLC down the line. Consult with a lawyer to understand the legal structures of both types better.

Administrative tasks

Bookkeeping is one of the most important tasks you can’t neglect as a solo entrepreneur. After all, you have to manage cash flows and pay taxes.

Keeping all transactions recorded and up-to-date can save you from overspending and tax penalties.

If you’re unsure how to manage your money, expenses, and taxes, spend some time consulting with a professional accountant.

Alternatively, you can use tools like FreshBooks and QuickBooks.

You can link these to your bank account and they will automatically track and manage your expenses. They’re also useful for creating and managing your customers’ invoices.

Those cloud-based accounting tools are user-friendly and available at affordable monthly subscription prices. Freshbook Plus costs $12.50/mo while QuickBooks plus costs $35/mo.

If this sounds like too much of a hassle, you can outsource the task or hire an accountant instead.

They can calculate the taxes you need to pay and give suggestions on how to manage your income and expenses.

Speaking of hiring, consider outsourcing work to employees or freelancers if you plan on scaling your business.

After all, when the project scope increases, you might be short on time for anything other than web design.

You can hire virtual assistants from Upwork and Fiverr for administrative and management responsibilities. And maybe hire some more people to help you out with smaller projects.

Proposal and contracts

A business proposal helps you explain what you offer and how your clients can benefit from it. You can also illustrate your design skills by making one on your own.

However, having to make one for every transaction can be tedious. That’s why you need a template.

You can create your own proposal template or modify pre-made ones. Nevertheless, here are the elements every winning proposal template should have:

Cover page – it should contain your name and the client’s name. Include a project title and a short description of what the proposal is about.
Background – a brief introduction to your company and an overview of your service.
Problem statement – the problem your client is facing. This is your chance to demonstrate a deep understanding of their web-design needs.
Suggested solutions – what solutions you’re proposing and how your company can help.
Process and scope of work – explain your approach and the estimated timelines of the project, as well as what your service covers and doesn’t.
Testimonials – put a few references from past projects to showcase your credibility and accomplishments.
Pricing – the breakdown of costs. It’s good to converse with your clients first about their budget before making a proposal. So both parties know what to expect.
Contact section – ways to contact you should the client want to proceed with the project. Most people just want your email address and phone number.

Aside from these elements, put a contract in your proposal. It should highlight your terms and conditions, as well as all parties’ rights and obligations. Never accept a transaction without a signed contract beforehand.

You can use legal document templates from DocuSign, LegalZoom, or And.co. All of them come with e-signature capabilities, making approval easier.

Have an attorney review your contracts before submitting them. That way, you can be 100% sure the contract protects your rights and complies with regulations.

You can also consult attorneys on how the contract works in an international context if your customers are from different countries.

Insurance

Having a contract is not enough. While it can help all parties involved to understand obligations and rights, you still need protection against potential liabilities and lawsuits.

This is where insurance comes in. It provides a safety net for you to fall back on in case of emergencies.

Below are some of the most common insurance plans for web design businesses:

Business owner policy – a bundle that protects you against general liabilities and property damages.

For example, if your equipment short-circuits and spreads fire, this insurance will cover the replacement cost and possible lawsuits by your landlord.
Professional liability insurance – also known as errors and omissions insurance in the IT industry.

This protects professionals from lawsuits if they make a job-related error, miss a deadline, fail to finish a project, or are accused of negligence.

Copyright infringement and scope creep are also covered under this policy.
Workers compensation insurance – should you hire more people, you need this plan to cover medical expenses if they get injured while working.

A portion of this policy also protects you if the employee presses charges.
Fidelity bond – protects against lawsuits filed because of an employee’s dishonesty, negligence, or disappearance.

This one’s important in case you hire someone who disappears mid-project, delaying the work and angering the client.

The costs of your insurance will vary depending on location, the number of employees, business risks, coverage limits, and type of policy. However, you can get a rough estimate here.

Step 5. Build a customer base and grow your business

Now that you’ve got all of your materials and tools in order, it’s time to promote your web design company.

It’s worth keeping in mind, however, that marketing isn’t just a one-time project:

The best way to start is by making use of your existing network. Let your peers and families know on social media that you’re open for business.
You can also use social media marketing to reach a broader audience and engage with them. Experiment with various content from articles to tutorial videos.

Or, you can market your service on freelancer platforms such as Fiverr or Upwork.
Another great way to attract more customers is by contributing back to the community.

This can be in the form of providing web design courses, consultations, or free resources like fonts or ebooks.
You can also use the resources you made as a lead magnet. What does that mean? It’s the product you offer in exchange for visitors’ email addresses.

By building an email list, you can send regular newsletters to your subscribers’ inboxes, increasing engagement and conversion potential.
It’s also possible to utilize email marketing to cold pitch your service.

Cold pitching is a practice where you target customers and convince them why they should use your service or product.

Once you have a sizable following, you can take your company to the next level by partnering with other businesses.

Find relevant companies that share similar target customers as yours to serve clients together. Think of IT companies, accounting firms, graphic design agencies, web hosting, and marketing.

You can host events or conferences with your partners to raise awareness about your brand and exchange knowledge.

Other ways to diversify income and grow your business include joining affiliate programs or reselling products. You can earn a commission from conversions you made or products you resell.

Setting up a referral program for your customers can be profitable as well. You can pay them with commissions or discounts in exchange for bringing more business to your table.

There is no shortage of opportunities for growing a web design business. Now it’s all up to you.

The benefits of starting a web design business

If you’re a web designer, working for a company and being your own boss are two different things.

Fortunately, being self-employed to start a web design business comes with plenty of perks. Here are some:

Flexible working hours and workplace – you can run your web design business on a flexible schedule without being tied to one place.
Freedom to choose clients – you decide which clients to work with and which projects to take. Working with a company might not grant you similar freedom.
High-demand – Bureau of Labor Statistics projected the employment rate of web developers to grow 13% in 10 years. This is faster than any other occupation.
Attractive pay rate – in the US alone, a web designer can earn as much as $34/hour or more than $70,000/year.
Easily scale as you go – the flexibility of the web design business can cut hiring expenses. As you don’t need an office and onboarding can be done remotely.
Learning from the best – running a web design and development business requires you to be adaptable and highly knowledgeable. Luckily, it’s not hard to find communities for web designers to network and learn.

How to start a web design business recap

While starting a web design business is far from easy, it has the potential to bring significant success for aspiring web designers.

Thanks to the increasing demand for web design services, companies in this field grow quickly.

Unsure of where to start? Below is a recap of the step-by-step we covered in this article:

Set ahead a business plan
Prepare in advance
Improve your skills, pick your tools, define expertise
Address administrative and legal matters
Expand your business

We hope this article was helpful. Leave a comment if you have more advice for aspiring web designers or want to share your experiences in the industry.

How to Start a Web Design Business