Starting and Sustaining a Successful Design Business
By: Gus Granger
Tags: Creative Career, Entrepreneur, Tech, Business, Design

Designers coming right out of college tend to want to start a firm right away, but before you can put yourself forward as an expert, you need to figure out the profession which you’re going to tell clients that you’re an expert in. I know, I’ve been there, and I’m here to help you get there too.

Attracting clients

The most important part to forging a successful design practice is to start to get clients. You can always build a body of work, but how do you build relationships with companies that are going to come to you for your expertise? Sometimes you are fortunate to get referrals for your work, but luck isn’t a long-term strategy. In the early days of my company, we weren’t forced to develop a new business system because the phone kept ringing.

But when the phone doesn’t ring, how do you go out and hunt? The metaphor I always used was, if you’re cave dweller and the game keeps wandering into camp, you just club it over the head and say, “Oh great, we always have food to eat.” Now what does it look like for you to pick up the spear and go out and hunt or gather food if you need to develop both muscles?

Strong new business skills give you more control over the type of design practice you want to be. Otherwise the clients that are being referred to you end up determining your fate. I wish I had a clearer sense of understanding of that when I started.

Specialize and make yourself indispensable

In my experience, the strongest means of attracting clients was to develop an expertise in a particular area and market yourself as a specialist — this is something a lot of designers and agencies are reluctant to do. They get concerned about the limits of only working in one area and repelling prospective clients in the areas outside of their focus. I found that the benefits far outweighed those concerns. I see generalists losing out to specialists constantly. You can grow and carve out a niche in multiple categories, but I find a generalist agency with a really strong body of work will always lose out to a specialized agency. It poses less risk to a client, who is going to find proven results more persuasive than a great portfolio.

For example, if you’ve done some work in the green energy sector, it might be a way for you to start steering your body of work that way. Do some blogging on what it’s like to build brands for green companies and share your knowledge. If that becomes part of how you’re presenting your design business, it’s going to be a lot more intriguing to potential clients.

Also pay special attention to search engine optimization and ensuring people can discover your business, where to find you, and what business value you’re offering. The role of writing is more important than ever because when companies are making buying decisions, or doing research, they’re going to spend time learning about you online. If all they have is just a collection of images, they’re not learning much around how you think, how you solve problems, and what type of expertise you’re bringing to the table.

Specialization is critical these days in design, also because there are so many templates and precast designs that non-designers can just grab and use. Soon people will just be able to download a template for a brochure and paste their copy into it. And so our role as brand architects and sometimes business strategists is more prominent than ever.

Immerse yourself in the client’s business and their audience

Understanding your clients, their audience, and how to best express it in a way that’s custom-tailored to their organization is also critical because that’s not something that can be done through templates. It’s the path to having more of a quality life as a designer.

Having a deeper understanding of your client’s business and their customers will provide…

A stronger base of trust with your client;

More value in the work you’re doing for them (business value for the client means more value in the service you’re providing, which leads to your ability to bill more);

Potentially the ability to be more creative and experimental with your work

Go into a deep discovery and learn about your client’s business and the industry they’re in, as it will provide you with the information and tools you need to create a product that goes above and beyond your client’s expectations. As much as you can, you also need to become an ambassador for the customers they’re trying to reach and understand the problems they’re trying to solve. If you do that, you’re in a better place to advise the client on what they need. They might come to you for a brochure, but it could be an opportunity to sell a larger or different type of project, since you will have an understanding of their business and corresponding design needs in a way that makes you invaluable.

Prioritizing that level of deep understanding goes a long way toward building a deeper trust with the client. It allows you to be able to take greater risks and do more interesting work, because they have confidence that you understand their space and their audience. It connects with clients and motivates them.

If you lean too hard on aesthetics, and that’s all you’re offering as a service, you’re quite replaceable. It’s your job to make sure you’re indispensable and that you create something that is compelling, unforgettable, and going to be seen as an investment by the client, not a cost. Whether a client comes to you for an identify, a website or a store campaign, they need to be able to see tangible results for their bottom line. It’ll make them come back, bring you more work, and refer your company to others. Frankly, the type of fees you’ll be able to charge will be enhanced as you’re delivering demonstrated business value and not just beautiful artifacts.

My agency, for example, created affinity by having a deep understanding of the B2B enterprise technology sector. Many other agencies would have needed to spend months (if not years) getting up to speed on the technology and customer buying habits. Companies don’t have that time. If you’re a design firm that specializes in beer packaging (and you’re really good at it), the mastery that you bring to the table for your client creates a big advantage.

Develop a value-based pricing strategy

At the beginning of any working relationship, you need to have a strong contract in place, so there’s a clear understanding of what you’re expecting from the client and what they’re expecting from you. It should include your fees, payment terms, the terms of ending the relationship and an explanation of how to measure its overall success. People often skip past it but it sets the ground rules before you jump in and do the fun part.

It’s important that you base your fees on the genuine business value that you’re providing. If you create an identity, it’s more than just coming up with a logo; you might create a countless number of assets, sit down and have meetings with the client’s customers, direct photo shoots, and create a whole new experience for customers to connect, all in the name of a stronger brand identity. Move away from billing hourly for design projects and only use that model for retaining clients who just want to buy a block of time. For those projects, you can determine the going rate by referring to the The Graphic Artists Guild’s handbook on pricing and ethical guidelines.

Learn how to budget

Pay yourself — or your business — first, save and put away money for tax. Build up reserves, so that you’ve got a good foundation and are in control. That way you aren’t being forced to take on projects you don’t want, whether that’s work you might not find exciting or agree with morally, just to keep the lights on. It gives you more flexibility to pursue the types of relationships and work that you really want to be doing.

If you run a small design agency and start working with a big company, their payment terms might not be in alignment with the way you’ve been accustomed to. To bridge that relationship, make sure you have a good finance team — good accountants and a good financial advisor. It may sound daunting, but this will pay for itself over time. Financial planning (for example cash flow, tax, payroll) is as relevant for a one-person business as for one with lots of employees. And as soon as you get on the radar of a big entity, the decimal points may move a lot. It’s completely different from the budgeting and planning you’re used to, and you’ve got to be ready for that moment if that’s the type of business you want.

My agency started in an extra bedroom and over 15 years grew to 50. There were different chapters of reinvention. It was almost like six different companies, and I had to relearn my skills over and over again. Being an individual freelancer is very different from being responsible for a payroll of 50. At each stage make sure you’re armed with great counsel and advice. Business administration isn’t a mystery but it’s not talked about enough in design circles.

The more you get business literate, the more it’ll help you become a better designer. If the operations of your business are in good shape, your team will be healthy, and you’ll be mentally healthy and able to concentrate on what you love.

Enjoy yourself!

At the end of the day, it’s important to prioritize joy. The best kind of work is happening when you’re enjoying it. To that end, ensure you’ve got the fundamentals of running the business right, but also surround yourself with people that you respect and enjoy working with. Develop a trusting relationship with your team and your clients. And if you work with friends, which can be fun, be cautious that you always maintain a clear business relationship. If you keep good boundaries, both your friendship and business relationship can thrive. All those things are part of the alchemy of really strong creative work, which ultimately is what we all want.