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 step guide to starting your longarm quilting 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 long it will take you to break even?
- 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 longarm quilting business?
Most longarm quilting business owners manage everything from their home office/studio. Before getting started, coordinate with your insurance professional to identify any additional insurance needs that could arise from this business venture. One uninsured claim could shut your business down for good. In addition to these needs, it is important that you invest a portion of your budget towards marketing your business.
Many entrepreneurs entering this industry already own a frame and machine that they are comfortable with. If you are due for a new one, these setups range anywhere from $1,500 to over $7,000. There are used options available; just make sure you purchase from a reputable retailer and have tested out the equipment prior to purchasing. Your new machine, plus needles, thread, pantographs, and the other items needed to properly set up a business in the U.S. will set you back up to $15,000.
What are the ongoing expenses for a longarm quilting business?
Ongoing expenses for a longarm quilter are fairly minimal. In addition to the standard administrative fees associated with running a business, business owners are encouraged to attend conventions annually. This is a great opportunity to stay abreast of emerging trends and network within the community. You will also want to make sure your equipment is serviced regularly, which will help reduce lost revenues due to failed equipment. You will be required to reinvest a portion of your earnings to purchase supplies for any upcoming projects. This money is recouped once you collect fees on said project.
Who is the target market?
This industry caters to a very niche market. The vast majority of your clients will be quilters who lack the necessary skills and/or equipment to finish their own creations.
How does a longarm quilting business make money?
Each client has their own set of unique needs. Fees are collected based on the services required and are set based on hours invested and supplies required. The fee structure is similar for custom and original pieces sold by the longarm quilter.
How much can you charge customers?
Each quilt will be priced based on the services required, techniques used, price of material, and time spent on the creation. Experienced quilters recommend determining a base hourly rate ahead of time. This will simplify the quoting process. When approached with more complicated orders, you can then determine the average time it would take, including additional time spent on more in-depth techniques, and multiply that by your hourly rate. Longarm quilters who are unsure how long a specific technique would take are urged to add an additional percentage to the total price - 25% to 75% is standard, depending upon the complexity and size of the work. Some longarm quilting service businesses charge a flat fee per square inch.
How much profit can a longarm quilting business make?
Total annual profit depends upon your fee structure and the number of orders you complete. If you charge by the square inch, a basic longarm service on a queen size quilt will earn you just under $100, with a king size coming in at $125. To increase profits, many business owners offer a variety of additional services, including creating custom quilts for interested clients.
How can you make your business more profitable?
To maximize profitability, consider taking as many custom orders as possible. You can charge a higher rate for these pieces, potentially doubling your income and requiring lower production numbers. Many quilting professionals have also found success teaching quilting classes, as well as selling their own patterns.
What will you name your business?
Choosing the right name is very important. 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.
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 longarm quilting business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
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.
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.
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 longarm quilting 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 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.
Certificate of Occupancy
A longarm quilting business is generally run out of a workshop. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a longarm quilting business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your longarm quilting business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
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 longarm quilting business
The most critical component to your marketing strategy is a portfolio of your work. This will show potential customers your experience and skill level. Once you have done so, share printed material throughout your area, targeting shop owners, local guilds, patchwork teachers, upholstery and drapery shops, and interior designers. If your goal is to extend your reach beyond the local market, a website or Etsy account, along with a strong social media presence, should be an integral part of your marketing strategy.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
Customer retention is largely based on the level of customer service you deliver. For each order, make sure you do not exceed the agreed-to budget and that the quilt is delivered on time. Of course, things come up that are out of our control. If this happens, communicate with the client throughout the process. When working with local shops, the image you portray and the service you deliver will have long-lasting effects. Strong customer service ensures positive word of mouth, while one negative review can cause you to lose that customer and everyone else with whom they decide to share their story. This includes how you decide to handle that “bad customer” who is clearly in the wrong, yet unwilling to take ownership of any wrongdoing.
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 Longarm Quilting Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Those who enter this industry truly enjoy the process of helping fulfill someone else’s vision. They enjoy working with their hands, adding the finishing touches to their clients’ artistic fabric pairings, which tell a story. Most quilters have spent years sewing quilts for family and friends and, at the encouragement of others, are ready to take their hobby to the next level.
What happens during a typical day at a longarm quilting business?
As a longarm quilting business owner, much of your day will be spent on the longarm machine. But there are a number of other tasks you must tend to on a regular business to ensure you are treating this like a business, rather than an extension of your hobby.
- Answering inquiries, via telephone and/or email, from potential customers
- Collaborating with clients regarding the specifics of their order
- Managing inventory, delivering original quilts that have been sold
- Shopping and ordering the essentials for each project
- Marketing your business and completed projects
- Tending to administrative duties such as sending out invoices and paying bills
- Researching new techniques and industry trends
As the business begins to mature, it may be necessary to hire an assistant to handle administrative tasks, allowing you to focus solely on the duties that inspire you most.
What are some skills and experiences that will help you build a successful longarm quilting business?
Those entering this industry have typically been creating quilts as a hobby for many years. Therefore, they possess the necessary skills and experience to create their own masterpieces and help less experienced quilters realize their quilting vision. However, hobbyists turned entrepreneurs are urged to carefully consider this from a business standpoint. When approached for a quote, it’s important to provide the client a realistic timeframe; and stick to it. Additionally, your quoted price includes all materials and time spent, so it is critical that business owners have enough experience to make these estimations accurately. Failure to do so results in reduced profits.
As mentioned, this is now a business, rather than a hobby. Therefore, those who do not possess strong business management skills or are not educated in modern marketing strategies are encouraged to seek assistance from professionals who are experienced in this realm.
What is the growth potential for a longarm quilting business?
The growth of your business is directly tied to the number of hours you wish to dedicate to production, as well as consumer demand. Quilters looking to take their business’ growth to the next level are committed to a strong marketing strategy, hiring additional longarm quilters to ensure orders are fulfilled on time and at or below budget.
TRUiC's YouTube Channel
For fun informative videos about starting a busines visit the TRUiC YouTube Channel or subscribe below to view later.
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 longarm quilting business?
Successful longarm quilting business owners offer the following advice:
- Carefully consider all ongoing costs associated with managing your own business. Price your services accordingly.
- Develop a thick skin and really push the customer for input. There is nothing worse than a client saying “Just do whatever” and then reporting back later that this was not what they were looking for at all.
- Practice long and hard, really sharpening your skills, before deciding to take money for this specialty service.
How and when to build a team
Longarm quilt business owners encourage those just entering the industry to work with professionals who can help guide you through the process of starting and managing a business. While it may increase your budget, the additional profit realized will more than make up for monies spent. If and when demand increases, you might want to consider hiring more longarm quilters. When interviewing prospective employees, carefully consider their experience and what skills they bring to the table. While they may be completing the work, it is your name that goes on each quilt.