How to Start a Branding Agency Business

A branding agency assists businesses in developing their public image. They design logos, craft slogans, and develop marketing strategies, all with one primary goal in mind - to develop a consistent voice and image that attracts their target demographic. Through creative branding, consumers gain critical knowledge regarding the organization’s mission and core values. 

Ready to form your LLC? Check out the Top LLC Formation Services.

Learn how to start your own Branding Agency Business and whether it is the right fit for you.

Start a branding agency business by following these 10 steps:

You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your branding agency business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Check out our How to Start a Business page.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

Luckily we have done a lot of this research for you.

What are the costs involved in opening a branding agency business?

As a branding agency, clients are looking to you to help bring their message to the public. Therefore, YOUR brand will play an integral role in building your portfolio. Start-up business owners will need to invest in an office space, computers, software, and other creative tools that will help deliver results. Additional start-up costs incurred include office furniture and fixtures, utilities and internet, payroll, and insurance.

What are the ongoing expenses for a branding agency business?

Owners who operate conservatively have an opportunity to generate significant revenue without incurring high ongoing expenses. The following should be considered when developing a budget: 

  • Rent and utilities 
  • License renewals
  • Equipment maintenance
  • Investment in the latest technology 
  • Website and marketing costs 
  • Networking expenses, including travel and client lunches
  • Employee salaries

Who is the target market?

In a broad sense, your target market is any new and/or existing business that needs your expertise in developing their brand. To ensure success, however, you will need to carve out a niche for yourself, taking on clients that you identify with in some way. Most branding agencies are hired by small to medium-sized businesses. With a pool of over 30 million to choose from, there are more than enough prospects to build a successful agency. 

How does a branding agency business make money?

Branding agencies generate revenue through the services they offer their clients. Some agencies charge a flat fee based on the scope of the project, while others bill an hourly rate. 

How much can you charge customers?

As previously mentioned, some agencies work on a fee-based schedule, others bill by the hour. Fee-based projects are typically more attractive for the customer, as it allows them to budget accordingly. Business owners opting for this approach are encouraged to carefully consider hours spent and overhead costs to ensure they don’t underbid for a project. 

How much profit can a branding agency business make?

With minimal overhead costs, well-managed agencies have the potential to turn a significant monthly profit. If you work with thirteen clients and charge an average of $2,500 per month, your agency will generate over $32,000 a month (before expenses.) 

How can you make your business more profitable?

Once you have developed a name for yourself, you will want to consider expanding your team and the services you offer. For example, some branding agencies host events for their clients, ensuring the organization’s brand remains consistent in everything they do. 

What will you name your business?

Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.

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STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your branding agency business is sued.

Form Your LLC

Read our Guide to Form Your Own LLC

Have a Professional Service Form your LLC for You

Two such reliable services:

You can start an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

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You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.

Learn how to get an EIN in our What is an EIN guide or find your existing EIN using our EIN lookup guide.

Small Business Taxes

Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).

You can learn more about small business taxes in these guides:

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.

Open a business bank account

  • This separates your personal assets from your company's assets, which is necessary for personal asset protection.
  • It also makes accounting and tax filing easier.
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Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.

Open net-30 accounts

When it comes to establishing your business credit, net-30 vendors are considered the way to go. The term "net-30," which is popular among vendors, refers to a business credit arrangement where the company pays the vendor within 30 days of receiving goods or services.

Net-30 credit terms are often used for businesses that need to obtain inventory quickly but do not have the cash on hand.

Besides establishing business relationships with vendors, net-30 credit accounts get reported to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.

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Recommended: Read our guide on the best net-30 vendors so you can start building business credit now, so you never have to worry about cash flow in the future. Keep in mind that poor cash flow is the #1 reason businesses fail!

Get a business credit card

  • This helps you separate personal and business expenses by putting your business' expenses all in one place.
  • It also builds your company's credit history, which can be useful to raise money and investment later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a Branding Agency. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.

For information about local licenses and permits:

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Learn more about General Liability Insurance.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

STEP 8: Define your brand

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
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Recommended: Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker.

How to promote & market a branding agency business

An agency’s marketing strategy should be developed around its short and long-term goals. Online ads, social media posts, SEO strategies, and networking events are all effective ways to gain a presence within the industry. 

How to keep customers coming back

It’s important to remember that your clients’ successes equal your success. You will retain your customer base by consistently delivering results. This means keeping a pulse on new and emerging industry trends and adapting to the public’s needs and pain points. 

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Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.

STEP 9: Create your business website

After defining your brand and creating your logo the next step is to create a website for your business.

While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.

Here are the main reasons why you shouldn’t delay building your website:

  • All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
  • Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
  • Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.

Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.

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Recommended: Get started today using our recommended website builder or check out our review of the Best Website Builders.

Other popular website builders are: WordPress, WIX, Weebly, Squarespace, and Shopify.

STEP 10: Set up your business phone system

Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.

There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use.

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Recommended: Find the best phone system for your business; check out our review of the Best Business Phone Systems 2021.

Start A Branding Agency Business In Your State

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Select your state below for an in-depth guide on completing each of these steps in your home state.

Is this Business Right For You?

Entrepreneurs who are creative and possess an innate ability to understand both the organizations’ and individuals’ goals and needs are best suited for this business venture. They enjoy interacting with a diverse group of individuals and are comfortable delivering a clear and honest opinion of what ideas should and shouldn’t leave the brainstorming table.

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Want to know if you are cut out to be an entrepreneur?

Take our Entrepreneurship Quiz to find out!

Entrepreneurship Quiz

What happens during a typical day at a branding agency business?

While every agency operates a little differently, there are a number of tasks that will remain consistent. These duties include: 

  • Marketing and networking to gain new agency clients
  • Developing pitches to prospective customers and upselling to current clients 
  • Meeting with clients to gain an understanding of their branding needs
  • Travel for client meetings and conventions
  • Researching to identify client target demographics and their pain points consider defining the term “pain points; at first usage. Not all readers may be familiar with this term
  • Creative duties, including designing, drawing, and writing
  • Administrative duties

What are some skills and experiences that will help you build a successful branding agency business?

While some branding agency owners have found success without a business or marketing background, the skills and knowledge gained from this experience would prove invaluable. Strong interpersonal skills and an innate understanding of the public’s needs and pain points are also excellent skills to possess. Start-up entrepreneurs are encouraged to gain real-world experience before venturing out on their own. 

What is the growth potential for a branding agency business?

According to the Small Business Association (SBA), there are almost 31 million small businesses across the United States. Their success rate relies almost entirely on their brand. Branding agencies who are consistently able to deliver results have significant room for growth, both nationally and internationally. 

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Take the Next Step

Find a business mentor

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

Learn from other business owners

Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.

Resources to Help Women in Business

There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:

  • Funding
  • Events
  • Guides
  • Support

If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.

What are some insider tips for jump starting a branding agency business?

Most successful agency owners agree that your success starts with your own brand. It is critical that you show the public how your agency stands apart from the rest. How could you persuade a client to invest their hard-earned money into building a brand if you haven’t put the work in for yourself? Also, while it’s tempting to take on every prospective new client that walks through the door, this practice could negatively hurt your image. Selectively taking on clients whose vision and mission align with yours will set you both up for success. 

How and when to build a team

While it is not necessary to start out with hundreds of employees, it is recommended that you develop a well-rounded branding team. Consider your strengths and weaknesses and build a team that fills in the gaps and complements each other. This will help keep those creative juices flowing during brainstorming sessions and broaden your target demographic.

Next Steps

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