The U.S. interior design industry has grown significantly in recent years and is worth a whopping $25 billion. If you’re a creative who has a home interior that’s the envy of your friends and neighbors, now could be a great time to put your skills to work and start your own interior design business. You just need a computer, some design software, and a marketing budget to get started.
Here you’ll learn the key steps to starting a successful interior design business.
Choose a Niche – Or Not
If your skill is in a particular design style, such as modern, traditional, or mid-century, you could elect to focus on your strength and specialize in a niche. You could also choose to specialize in commercial property design or residential design. If, however, your creativity can handle any kind of style or property, you don’t have to pick a niche and could do a variety of designs.
Strategically, you also could do some research into interior design businesses in your area to see if anything is missing, such as a business that specializes in modern design. You could then choose the modern niche to differentiate your company in the market.
Create a Business Plan
Before you do anything else, you need to have a strategy ready. Creating a formal business plan will be a learning process and will help you to create your strategy. You’ll also need one if you’re going to try to obtain financing for your business.
A business plan includes several elements.
- An executive summary that covers all the highlights of your full plan
- An overview of your business that includes your company mission and vision
- A summary of the services your plan to offer and your proposed pricing model
- An analysis of the interior design market as a whole
- An analysis of your local competitors, their strengths and weaknesses, and how you’ll create a competitive advantage
- A marketing and sales strategy
- A plan for operating the business on a day-to-day basis
- Your financial plan and projections
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Select a Business Structure
Next you have some nuts and bolts to take care of before you get started, the first of which is choosing a business structure. If you’re starting the business on your own and don’t form a business entity with the state, you’ll be operating as a sole proprietorship. If you have a partner or partners, you’ll be operating as a partnership.
With both of these structures, you and the business are considered a single entity, which means that you’re personally liable for the obligations of the business.
Another option is to form a limited liability company (LLC) which offers personal liability protection for its owners, since the LLC is considered its own entity. An LLC also offers the same pass-through taxation that sole proprietorships and partnerships offer. Pass-through taxation means that the LLC is not taxed, and profits are instead taxed at the personal tax rates of the owners.
The other main option is a corporation, which also offers personal liability protection, but is much more complicated to form and manage. A corporation is also subject to corporate taxes.
Most entrepreneurs choose a limited liability company since it offers the best of both a corporation and a sole proprietorship or partnership.
Apply for an EIN
If your business has more than one owner or will have employees, you’re required to obtain an employer identification number (EIN) from the IRS. An EIN simply allows federal tax authorities to identify your business for tax purposes. You can easily apply for an EIN on the IRS website at no cost.
Get Business Licenses and Permits
You may be required to obtain certain licenses and permits for your business at the state and local levels. Check with your local governments for requirements. If interior design services are subject to sales tax in your state, you’ll also need a sales tax permit.
Talk to Your Insurance Agent
Talk to your insurance agent about different types of insurance that you may need. You’ll want to, at the very least, get general liability insurance which provides coverage in many situations that may occur.
Purchase Design Software
Now you get to the fun parts of starting an interior design business. You’ll need to purchase some software, preferably 3D software, to be able to show potential designs to your clients. Software comes with a monthly or annual fee, but it will be worth the cost and customers will appreciate it.
Most software also offers features like estimate creation, invoicing, contract templates, and much more.
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Create a Website
You’ll need a website so that potential clients can find you. You can develop one yourself on various sites like Wix or GoDaddy, or you can go to a web design and development company to create a website for you that looks more professional. The most important element to include on your website is photos of your work, even if they’re only of your home for now. You can add other photos later.
Start Marketing Your Business
Marketing your interior design business involves several key elements.
Create a Unique Selling Proposition
A unique selling proposition is generally one sentence that describes how your interior design business will meet the needs of potential clients. You’ll want to use your USP on your website and in your marketing. Examples of a USPs for an interior business could be:
- Tailored design solutions that reflect your unique tastes
- Designing sustainable spaces for a better tomorrow
- Transforming spaces into stunning reflections of your personal style
Set Up Your Social Media
Social media is one of the best ways to get exposure for your business. Set up business profiles on Instagram and Facebook, and create a strategy for posting and running advertisements.
Invest in Search Engine Optimization
Search engine optimization is a strategy to get your website to come up higher in search engine results. Unless you have experience with SEO, you should go to a professional to have them implement SEO strategies for you.
Get Listed Locally
You’ll want to get your business listed on Google My Business and Yelp so that people can find you when searching locally.
Relationships with people who can send you referrals are one of the best ways to find clients. For an interior design business, connecting with real estate agents and new construction salespeople can be invaluable.
Now you’re ready to start bringing in clients and making money. With the right preparation and strategy, an interior design business can be very successful. Eventually, you could build a team and grow your business to the next level. The potential is nearly limitless!
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