Doing Business as a Designer: Startup Business Cycles

Posted on June 15, 2010


In my last post, Doing Business as a Designer: How do I get more repeat business?, I explained that by asking the right questions in the first place, you will be able to solve their problems and produce remarkable results which increases your chance to get repeat business from them.

So what kind of repeat business can you get?

Generally speaking, the first 3 to 6 months of your design company’s existence will depend on bringing in new business. 98.2% of your income will be new customers. The remaining 2.8% will be returning customers. These percentages will change over time.

Graphic Designers and Print Designers

Your returning customers are more likely to buy from you within the next 1 to 3 months. The ones who return are most likely doing advertising campaigns and want to change the message of their fliers or redesign completely.

Web Designers and Developers

Most of your customer will want to add/fix/change features and tweak their webpage design within 2 months. The way I used to structure deals is to get all their needs, finance for 6 to 12 months, and have them pay half of the contract amount upon signing. The contract enables you not to lose the sale because of the huge upfront payment and at the same time keep your customer. Also, you get monthly income.

If you choose to go this way, you must have your sales pipeline filled at all times so you have multiple sources of income.

2D/3D Artists, 2D/3D Animators, VFX Artists, and Motion Graphics

If you not working in the industry as an employee, your chances of getting new and returning customers are much greater than those who do a lot of production work.

Doing industry work as a production artist/designer requires a lot of time and effort. You are most likely working massive amounts of overtime, more than 13 hours a day for 5 to 7 days in the next 6 to 12 months. If this is you, realize the commitment you will be making to your customer.

However if you have your own clients, your production cycles are most likely shorter, unless you get a big contract.