Jasmine Birtles
Your money-making expert. Financial journalist, TV and radio personality.
How to Set Up Your Freelance Business in Under One Week
Reading Time: 7 minutesSetting up a freelance business might seem daunting – but you could be finding your first clients within the next week! In these unstable times, having a side hustle or going full-time freelance is an appealing career option for many of us.
A freelance business can cover all sorts of things, from writing and graphic design, to cleaning, to trades like woodwork and plumbing. Some may take longer to really get going – but there’s nothing stopping you from setting up your freelance business in one week flat! Once it’s created, you’ve got a solid grounding to start building your business on and start finding those all-important clients. Here’s how to do it on limited funds AND in a short period of time.
- Decide on Your Business Type
- Research Your Competitors
- Choose Your Business Name
- Register with HMRC
- Create a Website
- Draw Up a Business Plan
- Set Up a Business Bank Account
- Seek Funding and Mentorship
- Identify Your Marketing Channels
- More Freelance Tips
Day One: Decide on Your Business Type
So, you want to run a freelance business. Doing what? Perhaps you want to take the knowledge and skills from your day job to start out on your own. Great! Many freelance businesses, such as marketing agencies, virtual assistants, graphic designers, and even customer service consultants start out in that way.
Perhaps you want to do something totally different. Tired of answering complaints calls every day, but have a knack for baking? A freelance business as a special occasion baker is something you can run alongside your main job – or turn into a fully-fledged job altogether!
Think about your skills, interests, hobbies, and passions. Consider the things you love about your current or previous jobs – and what you’d avoid doing ever again. Use this to help you shape your business idea.
Research Your Competitors
When you know what type of business you want to run, look at the competition. Consider the competition on a local and national level, too. Even take a look at international competitors – especially if they can’t encroach on your patch (such as if you’re a dog walker!) – as they could have some cool marketing ideas or strategies you could use.
Spend a day (yes, a whole day of your precious week-long setup target!) to look at competitors. Branch out a bit, too: look at related companies that would target the same customers as you. It might give you inspiration for a niche opportunity to bridge the gap, or help you develop ideas for extra services to offer clients.
Make a list of the pros and cons of each competitor. What do they offer? What’s lacking? How could you challenge their place in the market? This will help you decide your specific business angle, and that helps with the next steps of a business plan and marketing.
Day Two: Register with HMRC
Even if you’re setting up your freelance business as a side earner, you need to register with HMRC as a sole trader. You could become a Ltd company, too – but that takes a little extra time and cost. You can always switch over to being a Ltd company when you’re more established. When you’re starting out, it’s usually beneficial to stay a sole trader.
Even if you’re not expecting to earn enough this tax year to pay anything, you’re still going to pay Class 2 National Insurance contributions. So, it’s really important to register as self-employed with HMRC as soon as you start creating your business.
Choose your business name before you register. It makes the whole process much easier – and helps you when it’s time to start your marketing, too. Use a business name generator tool if you’re stuck for ideas – and check Companies House to make sure no one else has the same business name, too.
Create a Website
You don’t need to be an internet whizz to set up a website. These days, it’s really easy to create one! Most of the popular website hosts, like Wix, WordPress, and Squarespace, have drag-and-drop editors and simple to use admin panels. It’s really important, however, that you have even a basic site so that potential customers can find you.
Your website doesn’t need to be expensive or fancy when you start out, either. Remember: you can always expand your functionality and services as your business grows. You need to include basic information, such as:
- What product or service you offer
- How the product or service benefits your client
- A price list
- Contact information
- An ‘about you’ page – people like to know who they’re buying from!
You should also claim your social media handles, too. It’s often best to focus on just one or two platforms (especially at first) – but it’s a good idea to claim the handle on each one. This stops people impersonating you online – and also means you can keep the same name across all platforms if you want to expand. A really good site to try is Namecheckr – it’ll tell you which platforms have your chosen handle available. Try to choose one that reflects your website and business name, that you can claim on as many platforms as possible.
Day Three: Draw Up a Business Plan
Your business plan helps you work out how to get started – and then how to maintain growth in your first year. For example, you’ll need to decide what products or services you’re going to offer customers from the outset. How much will they cost to provide? What profit margin do you need on them?
Work out the cost of your overheads, too. This gives you a financial target to aim for in your first year – and helps price your services or products. You’ll need to think about rent, bills, business rates (if you’re renting a premises), insurance, inventory, and so on. Remember, too, that your first year means investing in assets like computers or other equipment.
Use a business plan template to make sure you’ve got everything covered. This will help you to decide if your freelance business will be viable as a profit maker. Your first year (or two) may not turn profit if you need to invest in a lot of equipment or inventory, so don’t be disheartened! However, the plan will help you see the costs you need to cover (including your own living costs) – and this helps you to know where to turn for funding.
Day Four: Set Up a Business Bank Account
As a sole trader, you don’t legally need a separate business bank account. However, it’s always a good idea to set one up to keep your own finances separate from that of the business.
Starting out, you don’t need to pay for a proper business bank account, either. You can set up a basic current account in your own name – just keep it for business income and expenses only. This really helps when it comes to doing your annual tax return, too!
Seek Funding and Mentorship
There is a TON of help out there for new business owners – you just need to know where to look.
If you’re currently unemployed and receiving Universal Credit, ask your job coach about the New Enterprise Allowance. This is a scheme to help you get started with your own business – and opens doors to business mentorship as well as startup loans and funding.
For those not in receipt of benefits, there are still lots of ways to fund your new startup. First, speak to your local library, council, and job centre. They may all have different schemes or be able to recommend local services that offer free business advice or help for new freelancers.
And remember, we’ve got some articles covering funding and benefits for the self-employed, as well as sources to find funding for your startup.
Why look for mentorship?
Your local job centre or council is likely to run schemes for new business owners. It’s important to seek advice from experienced business professionals, and if you can get free advice, that’s even better! Without guidance from a business mentor, you could fall into the common traps new freelancers make – such as not budgeting for no-income months – and end up without any profit.
Talk to your local Chamber of Commerce or the Federation of Small Businesses, and look for ‘digital hubs’ in your area, too. There are often free workshops and sometimes even reduced-fee or free workspaces for new businesses if you do some research. Wrexham Enterprise Hub, for example, is free – and gives you somewhere to work, have meetings, and also runs free training workshops.
Day Five: Identify Your Marketing Channels
When you’re starting out, you’re on a tight budget. So, marketing to all and sundry isn’t the most cost-effective way to spend your pennies!
You DO, however, have to spend SOME money on marketing to draw those first clients in. You can also hire a marketing agency in Kent to do this and enhance your marketing strategy. Once you’ve got them, they’ll offer reviews or word-of-mouth recommendations, which is free marketing that generates much stronger customer relationships, too.
Think about who you want as an ideal customer. What do they read? Which websites do they visit? Where do they go in your local community? Mix some online and offline marketing to get the best results. Try flyers in your local area, and digital adverts on social media platforms that are targeted at your ideal demographic.
Use the MoneyMagpie Marketplace
One option to find new clients in your area is to advertise on the MoneyMagpie Marketplace! It’s brand new – which means it’s currently free to list your adverts. After three months, the charge is only 8% of the customer spend – which is far less than other online platforms! Plus, you only pay when someone books your service or buys your product – which means you’re not paying for marketing until it’s successful.
More Freelance Tips
Creating a freelance business is an exciting time for every career-driven person. However, there’s so much to consider as you grow your business that it’s easy to feel lost. Read these articles next to arm yourself with all the vital info you need.
- The Best Part-Time Freelance Jobs You Can Start Now
- 7 Tips to Manage a Freelance Work/Life Balance
- What Is Access to Work and How Does It Help Freelancers?
- The Best Places for Freelancers to Find Clients
- 10 Ways to Stay Motivated as a Freelancer
Great info for freelancers.