How to Start a Translation Agency

A translation business provides translation services for a variety of different types of documents while maintaining the confidentiality of their clients. They ensure that the meaning and context of the material is not changed from the original document, and that spelling and grammar are correct.

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


Start a translation agency 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 step guide to starting your translation agency. 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 translation agency?

The costs of opening a translation business are minimal, since it isn’t necessary to rent office space. You’ll need to invest in office furniture, good lighting, a computer with high-speed internet service and a good all-in-one printer. Building a library of reference materials such as dictionaries and grammar books is also a wise initial investment. There is also professional translation software available, the cost of which ranges from between $200 and $1000.

What are the ongoing expenses for a translation agency?

Ongoing expenses for a translation business include:

  • Internet connection
  • Telephone
  • Office supplies
  • Payment for freelancers
  • Advertising and promotions
  • Continuing education and certification in a greater number of areas of expertise
  • Maintaining current research and reference materials

Who is the target market?

Preferred clients are people able to effectively communicate their needs as well as negotiate and adhere to the terms of a contract for translation services.

How does a translation agency make money?

A translation business makes money by charging a fee for translating various types of documents. Depending on the length and complexity of the document, fees may be either by the hour or by the assignment.

How much can you charge customers?

A survey of the American Translators Association concluded that the average freelance translator makes approximately $64,000 per year. While there is no set rate, it’s estimated that 11 cents per word is an approximate industry average. Many translators choose to charge by the page, rather than the word. The rate for translating a document depends on a number of factors including the word count or length of the document, the complexity of the information, and how much research is required. Another factor is how quickly the client needs the document, with rush jobs generally commanding a higher price.

How much profit can a translation agency make?

Translators can earn from $30,000 to $80,000 per year, depending on experience, location, and the volume of work available. As a sole proprietor working alone, your business is confined to your own language skills and areas of expertise. As the owner of a translation agency, you can either hire employees or contract with other freelancers with experience in other languages and specialties, such as commercial, technical, medical or legal documents.

How can you make your business more profitable?

Offering localization services, which involves using local idioms and creating visual content to accompany the translated information, is one way to make your business more profitable. International businesses require information about their goods and services in the languages of every country in which they hope to conduct business to succeed. There are many different niches in the translation industry, including business, education, government, and the healthcare industry. Specializing in specific types of documents such as business contracts, educational content, medical transcripts, or advertising materials can substantially increase your profits. Many translators also expand their operations to providing subtitles for audio/visual multimedia presentations. The worthy goal of any translation business is making valuable information available to the greatest number of people possible.

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.

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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 translation agency 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.

A cube with LLC printed on its sides

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!

A cube with LLC printed on its sides

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

A translation agency requires a business license. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

In addition, certain local licensing or regulatory requirements may apply. For more information about local 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.

Service Agreement

Translation businesses should consider requiring clients to sign a service 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 translation 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

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 translation agency

The global marketplace is expanding, and translation services are in high demand for both government agencies and international corporations. Introducing yourself to the directors of communications of businesses and agencies that frequently require translation services is the first step. Creating a database of potential clients such as healthcare organizations, law firms, financial institutions will enable you to send them e-mails, brochures, and other promotional materials periodically. Those materials should include information about your qualifications and areas of expertise.

Recommended: Get started with local advertising for your business with a $300 credit from Yelp.

How to keep customers coming back

There are a number of ways a translation business can attract and retain customers, including volunteering your services to charitable community organizations. You can also subcontract your services at a slightly lower rate to other translators until you’ve built a solid professional reputation. Your business should appear in the Yellow Pages and any local directories even though translation businesses also operate online and many assignments aren’t limited to a specific geographic area. That’s why it’s important to build a professional website and maintain a strong online presence, complete with testimonials from satisfied customers.

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 Translation Agency In Your State

A cube with LLC printed on its sides

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?

This business is ideal for those who speak more than one language and have a desire to contribute to achieving greater understanding and cooperation between people of different cultures.

What happens during a typical day at a translation agency?

The day to day activities of a translation business owner might include:

  • Negotiating contracts with clients and other translators
  • Translating documents
  • Maintaining business records
  • Preparing invoices
  • Bookkeeping and accounting
  • Utilizing reference materials
  • Seeking out and contacting potential clients

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

Some of the skills essential for building a successful translation business are:

  • Extensive knowledge of another language
  • Translation skills obtained through a certification program
  • Superior interpersonal communication skills for negotiating contracts and clarifying clients’ requirements
  • Time management skills for meeting deadlines demonstrated
  • Certification to demonstrate proven translation skills
  • Cultural awareness

What is the growth potential for a translation agency?

As globalization continues to increase, the growth potential for translation businesses increases as well. The need for interpreters and translators is projected to grow 29% within the next seven years, much faster than other occupations. Immigration, multi-national businesses, and the internet have all contributed to an increased awareness of our interconnectedness. Some of the largest translation agencies have offices all over the world and employ thousands of translators.

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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:

  • 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 translation agency?

Industry experts recommend networking with other translators. Passing along jobs that require expertise that you don’t have usually results in other translators returning the favor. Confidentiality and respect for one another’s clientele as well as professional capabilities is essential. However, it’s equally important that you take the proper steps to assure the quality of other translators’ work before entrusting them with projects for your clients. This can be done by requesting some samples of their work in the target language. If you aren’t proficient in a language yourself, it is worthwhile to hire a native speaker to judge the quality of a translation. Those with experience in the industry maintain that it usually takes at least two years to build a clientele.

How and when to build a team

It is important to build a team even before you open your business. You should also become a member of some professional trade organizations to keep abreast of new developments within the industry. They also provide many types of professional development opportunities and other valuable resources.

Next Steps

Get more ideas with our Business Ideas Tool.

Check out our How to Start a Business page.

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