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Freelancer or Design Studio, which is best for your home-based business?

I talk a lot on the Resourceful Designer podcast about running a home-based design business. In fact, it’s why I started the podcast in the first place. Like my catchphrase says, I’m doing this to help designers like you streamline your business so you can get back to what you do best, designing.

I’ve covered many topics in the previous 124 episodes over the past few years. Things like pricing strategies, attracting new clients, coping with the isolation when working from home and many more. However, I’ve never talked about what options you have in the type of design business you run.

Deciding what type of home-based business you run is important because the direction you take could determine the kind of clients you attract and the growth of your design business. Including how much money you can potentially make.

The options I’m talking about are whether you define yourself as a Freelancer or Design Studio.

There is a third option available, a Design Agency. The reason I’m omitting Design Agency is that by definition, a Design Agency is made up of several people, all with different talents working on all aspects of client projects and usually all working under one roof. Perhaps you fit that category, but as I stated earlier, Resourceful Designer was created to help home-based designers, and I don’t think many home-based designers run agencies.

That leaves two options, Freelancer or Design Studio

Calling yourself a Freelancer

According to dictionary.com, a Freelancer is a person who sells work or services by the hour, day, job, etc., rather than working on a regular salary basis for one employer. Cambridge Dictionary defines Freelancer as someone who works on different projects with different companies instead of being a company employee. And finally, Merriam-Webster says a Freelancer is a person who pursues a profession without a long-term commitment to any one employer

I’ve never called myself a Freelancer. I’ve always found the term derogatory and noncommital. I always viewed the term as a kind of fly-by-night thing where the client will never be sure if the Freelancer will be there for them. Remember the Merriam-Webster definition was someone who pursues a profession without a long-term commitment.

Not to mention my business is registered, so in a roundabout way, I can say that I’m an employee of my own company, therefore, as an employee, I cannot be a Freelancer. But that’s neither here nor there. For this article, a Freelancer is merely a one-man band when it comes to design services.

As a Freelancer, you are everything from an art director, to a designer, to a coder, to handling accounts receivable and payable, etc. You do it all, and there’s nothing wrong with that.

When I first started my own home-based design business, I did precisely that. I handled everything. I was a one-man band. And if I didn't think I could do something in a project, I didn’t take on the job.

Defining yourself as a Freelancer, meaning it’s just you, limits the type of clients you can take on by the skills and services you offer. If you’re not a web designer, you don’t take on web clients and vice versa. Freelancers tend to attract smaller clients such as Start-Ups or the “quick” clients. Those who call you up and need something done this week, or worse yet, they need it tomorrow.

The average freelance designer takes on clients and jobs in the $500-$5000 range.

Calling yourself a Design Studio

Remember above when I said a Design Agency is made up of multiple people working together under one roof? A Design Studio is similar to an agency in that is offers a wide variety of skills and services, but some of those skills and services come from third-party contractors.

As a Design Studio, you still run your home-based design business like a Freelancer does, however, rather than offering a full range of services under one roof like an agency, you subcontract the parts of a project that you can’t or don’t want to handle yourself. Things like photography, coding, copywriting, illustration, etc. Being a Desing Studio allows you to take on larger clients with more significant projects and spread out the work to get jobs done more efficiently.

With a Design Studio, everything is processed through your business and clients deal directly with you instead of dealing with multiple businesses. You take on the role of art director and manage the subcontractors working on the projects with you.

Design Studios tend to attract small to mid-sized companies as clients. Companies that may have a marketing department but don’t have an in-house creative team. The Design Studio acts as their creative team.

Clients seeking Design Studios often have budgets ranging from $5,000-$20,000 or more.

Freelancer or Design Studio, what’s right for you?

Choosing between a Freelancer or Design Studio is a matter of choice. The difference between the two is your willingness to work with subcontractors to complete design projects. Neither Freelancer or Design Studio is a more favourable choice.

I ran my business as a Freelancer (even though I don’t use that term) for several years before switching models and redefining as a Design Studio. I still do most design work myself. But I now have a list of illustrators, copywriters, coders, etc. that I can call upon should I need their skills and talents for a project.

I don't suggest one option as being better for you over the other. It’s entirely up to you how you run your business. If you’re fresh out of school or still new to the industry, maybe you want to work as a Freelancer for a while until you get the hang of things. Perhaps you don’t want the extra responsibilities of overseeing subcontractors. That’s OK. Many designers spend their entire career working as Freelancers.

If you are comfortable handling larger projects and directing various people to complete specific tasks then maybe a Design Studio is right for you.

This article is simply to give you an idea of what’s possible depending on how you define what you do. So are you a Freelancer or a Design Studio?

Do you consider yourself a Freelancer or Design Studio?

Let me know by leaving a comment for this episode.

Questions of the Week

Submit your question to be featured in a future episode of the podcast by visiting the feedback page.

This week’s question comes from Allison

Hello, I love your podcast and have enjoyed getting some great advice on my freelance business from it. I was wondering if you had any recommendations for font subscriptions. Fonts are so expensive, I don't know how designers can afford to purchase so many unique fonts and was wondering if a font subscription would be the way to go.

To find out what I told Allison you’ll have to listen to the podcast.

Resource of the week Sharpen.design

This week's resource was shared with me by Resourceful Designer listener Naomi. It's the website https://sharpen.design. Sharpen.design produces random design prompts to challenge you to think outside the box. With over a million possibilities you are sure to find an interesting project you can tackle to grow your skills and portfolio. This website is an excellent resource for students or anyone new to the design industry who needs ideas of what they can design. Give it a try.

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I want to help you.

Running a graphic design or web design business all by yourself isn't easy. If there are any struggles you face running your design business, please reach out to me. I'll do my best to help you by addressing your issues in a future blog post or podcast episode here at Resourceful Designer. You can reach me at feedback@resourcefuldesigner.com

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