Start a illustration business by following these 9 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 illustration business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
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:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a illustration business?
The good news is that you’ll probably not need a studio or employees at first. Your overhead will be rather low. However, since a great deal of illustration work today is done digitally, you’ll need to invest in technology. Here’s how your main startup costs might break down.
- Hardware -- $2,000 or higher. This includes a computer, a printer, a scanner, and a digital camera. You might already have some of this equipment, and some might be unnecessary to how you do business, but the investment will most like fall in this price range.
- Software -- $1,000 or less. Again, your needs will depend on the work you take on, but some of the general must-haves of illustration can be found in the Adobe Creative Cloud bundle for around $600 a year.
- Art supplies -- $500 or less. These are the non-digital tools of your trade, and can include brushes, markers, paint, canvas, or whatever other materials you use.
- Marketing -- A few hundred dollars and up. This covers your website and portfolio, as well as promotional mailings and social media.
What are the ongoing expenses for a illustration business?
Once you’ve stocked up on your hardware, software, and supplies, your ongoing expenses will be few. You might spend a few hundred dollars on self-promotion or on transportation costs to get to appointments if you’re meeting clients in person.
Other than that, your only costs are likely to be whatever you’ll need to live on until your revenue grows to the point where you can support yourself. This is a good argument for starting your business slowly, maintaining a full-time job and moonlighting to serve a few clients until your business grows to the point where you can operate without an outside paycheck.
Who is the target market?
Anyone who has a need for and an interest in your art. This might be commercial clients from your chosen areas of expertise or consumers who admire your artistic talents.
How does a illustration business make money?
You’ll charge a fee for your business that’s often based on your estimation of hours to complete the job. Some clients will let you quote an hourly rate, but most will want to hear a flat fee.
How much can you charge customers?
There are so many different types of jobs for illustrators -- ranging from animation storyboards and book covers to wine labels and print ads -- that it would be difficult to flatly state what you should charge. But here are a couple of factors to keep in mind:
- Commercial illustrators tend to charge between $25 - $100 an hour, based on talent, experience, client roster and what the market will bear.
- Large corporate clients can afford to pay more than startup merchandisers working from their spare room. What this means is that your job estimate will often depend on what you think your client can afford and is willing to pay for the job. But whatever that amount is, take an honest appraisal of the fee in terms of the time the project will consume, and see if the hourly rate makes it worthwhile. (Sometimes the potential for additional business from that client, entry into a new field of specialty or cash flow needs offset misgivings about a disappointing rate.)
Consider joining The Graphic Artists Guild. The annual cost of membership is between $75 and $200 depending on your circumstances, but it includes a free copy of The Graphic Artists Guild Handbook: Pricing and Ethical Guidelines. In addition to the valuable pricing guidance for a range of projects you’ll find in the handbook, the organization offers additional business guidance and advice.
How much profit can a illustration business make?
The U.S. Bureau of Labor Statistics has a category called Fine Artists, including Painters, Sculptors and Illustrators, and lists a mean annual wage of $57,410 for that category. BLS also lists Graphic Designers, a related field, at an annual mean wage of almost $48,000. Of course, your earnings will only be limited by the reputation you attain, the clients you attract and the work you put out.
How can you make your business more profitable?
Consider specializing in leading-edge fields. For instance, the U.S. Bureau of Labor Statistics lists annual salaries at a median rate of $65,300 and rising to as high as about $116,000 for work in such fields as computer games, movies, music videos, and commercials. Do research to find the specialties and subspecialties where the pay is most attractive and find a way to secure those assignments.
What will you name your business?
Choosing the right name is very important. If you don’t have a name in mind already, read our detailed guide on how to name a business or get some help brainstorming a name with our Illustration Business Name Generator.
Then, when registering a business name we recommend checking if the business name is available in your state, federally by doing a trademark search, searching the web, and making sure the name you choose is available as a web domain to secure it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your illustration business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
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!
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?.
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.
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.
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 an illustration business. 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 more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Illustration businesses should require clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example service agreement.
Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your illustration business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.
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.
How to promote & market a illustration business
All you have to sell, initially, is your work. So make sure that all of your prospects can see your talent in terms of your website design and portfolio, as well as in your promotional pieces. One inexpensive form of promotion is a simple postcard showcasing one or more of your illustrations and directing recipients to your digital portfolio. If you have additional funds for self-promotion (or are willing to spend more for a few good prospects), consider investing in coasters, matchbooks, refrigerator magnets, t-shirts, or other atypical canvases for your work.
How to keep customers coming back
Once you’ve drawn a client base with your work, you’ll keep them -- and make them valuable referral sources -- with your commitment to their satisfaction. Make sure you take direction well, gracefully accept revision requests and turn in your assignments on time and on budget.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Illustration Business In Your State
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?
You must have artistic talents and an entrepreneurial drive. This means that your skill set must encompass both the ability to continually find work, to complete it to your clients’ satisfaction, and to continually find new clients.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a illustration business?
Your typical workday will include a range of activities that include practicing your art and maintaining good client relationships. Here’s how a typical day might look.
- Sending out marketing materials and placing calls to obtain new business
- Phone, email or in-person meetings with clients to get assignments and go over project details, budgets and deadlines, or revision needs
- Working on your billable assignments
- Networking with others in your field and maintaining your professional social media presence
- Investigating new software and technologies and buying supplies to stay current and ready for your next assignments
- Invoicing clients and keeping your business afloat
What are some skills and experiences that will help you build a successful illustration business?
Stay adaptable -- and keep learning. The technology, the tools and the opportunities are constantly changing. The career you undertake today will look nothing like what you’ll be doing in 20 years. That’s the good news! Stay curious and you’ll be able to choose from multiple paths to career success.
What is the growth potential for a illustration business?
That depends on the direction you take your business. The U.S. Bureau of Labor Statistics gives Graphic Designers -- a related field -- an outlook of one percent growth rate between 2014-2024. But opportunities are expanding in various digital multimedia fields, including storyboards for animation and other Silicon Valley assignments. Another example of a rising field is book jacket covers for independently published ebooks (though rates aren’t high).
TRUiC's YouTube Channel
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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.
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:
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 illustration business?
Get significant work experience before you go off on your own. This will not only show you how to find clients and complete jobs successfully, but it will help you build your portfolio for when you’re ready to go solo.
Also, consider networking if there are other independent illustrators in your area. You might join or form a cooperative to share such costs as studio space, website and promotion. Here’s an example of one such cooperative.
How and when to build a team
Chances are, you won’t have a team -- or the unnecessary cost of employees. But you might collaborate with other artists, photographers, or others serving your client base in order to expand your services and raise your rates.