If you're passionate about creating innovative designs and have a flair for managing a range of services, starting an industrial design business could be an exciting venture for you. This guide will walk you through the steps of initiating and operating a successful industrial design business, including the advantages and challenges involved in starting a business, how to go about creating a business website and strategies for generating revenue in the industrial design industry.
What is an industrial design business?
An industrial design business is a service-oriented business that offers a variety of design solutions, including product design, user experience (UX) design and creative services. Industrial design businesses typically provide services such as:
Product design and development
User experience (UX) and user interface (UI) design
Prototyping and testing services
Creative and branding solutions
Why start an industrial design business?
The industrial design industry shows promising growth, with projections estimating a steady annual growth rate of 5.2% through 2032. This anticipated expansion is driven by rising demand for innovative product designs. Given these favorable conditions, starting an industrial design business can be a profitable move.
How to start an industrial design business in 6 steps
01. Create a business plan
Develop a comprehensive business plan that covers key aspects of your business planning such as your target market, executive summary, marketing strategy and financial projections. Having a strong business plan allows you to clearly communicate your vision to potential investors when seeking funding. It should also include other important business information such as the type of business you plan to start and your choice of a business name.
Here’s an industrial design business plan template to get you started:
Industrial design business plan template
Executive Summary
Business Name: [Your Design Business Name]
Business Structure: [Sole Proprietorship/Partnership/LLC/Corporation]
Location: [City, State]
Founding Date: [Month, Year]
Founders/Owners: [Names]
Mission Statement: [Concise statement of the business’s purpose]
Business Description
Overview: Briefly describe your industrial design business, highlighting key features, services and specialties.
Unique Selling Proposition (USP): Clearly define what sets your business apart from competitors.
Target Market: Identify your primary client demographic and market segment.
Services and Specialties
List and describe the design services and specialties your business will offer.
Include areas such as product design, UX/UI design, prototyping and branding.
Market Analysis
Industry Overview: Provide an overview of the industrial design industry, including trends and growth projections.
Competitor Analysis: Identify key competitors, analyze their strengths and weaknesses.
Target Audience: Define your target client profile and their preferences.
Marketing and Sales Strategy
Marketing Plan: Outline your strategies for promoting the business, both online and offline.
Pricing Strategy: Detail your pricing structure and any promotional pricing.
Sales Tactics: Describe how you will attract clients and secure design projects.
Operational Plan
Location and Facilities: Describe your office location and facilities.
Suppliers: List and describe key suppliers for design materials and tools.
Staffing: Outline your staffing plan, including roles and responsibilities.
Financial Plan
Startup Costs: Detail initial investment requirements and startup expenses.
Revenue Projections: Provide realistic revenue projections for the first 3-5 years.
Operating Costs: Outline ongoing operating expenses, including utilities, software and staff salaries.
Funding Requirements: Specify any funding needed and potential sources (loans, investors).
Funding Proposal
Purpose of Funding: Clearly state how the funds will be utilized.
Amount Needed: Specify the amount of funding required.
Repayment Plan: Outline the proposed repayment plan for loans or investments.
Risk Analysis
Identify potential risks and challenges that may impact the success of your industrial design business.
Develop strategies to mitigate and manage these risks.
Appendices
Include any additional documents or information relevant to your business plan.
Examples: Portfolio samples, resumes of key team members, and mock-ups of design proposals.
Conclusion
Summarize the key points of your business plan and highlight the potential success of your industrial design business.
Conclude with a call to action or next steps.
Note: This template serves as a general guide. Adjust and expand sections based on your specific business model and goals.
02. Select a business structure
When starting an industrial design business, it's important to Choose an appropriate business entity or structure such as sole proprietorship, partnership, limited liability company (LLC) or corporation. Analyze the pros and cons of each, including factors like liability protection, costs, paperwork, taxation, and alignment with your goals.
Learn more: How to start an LLC
03. Obtain business financing or capital
Starting an industrial design business involves initial costs. Secure financing through methods like bank loans, grants, or investments from stakeholders to launch and sustain your business.
Costs that you’ll need to factor in when securing financing for your business include:
Office space and utilities
Marketing and advertising campaigns
Making a website and its maintenance
Design software and technology infrastructure
Initial salaries and benefits for employees
Professional memberships and certifications
Insurance coverage (liability, professional indemnity)
Legal fees for contracts and compliance
Purchase of design tools and equipment
04. Set up accounting and bookkeeping systems
Establish robust accounting and bookkeeping systems from the beginning to track income, expenses and ensure financial viability. This includes managing tax obligations if applicable.
05. Source specific design equipment
Acquire the necessary equipment for your industrial design business, including design software, computers and prototyping tools. Ensure that your technology infrastructure supports efficient design processes and communication. Some more specific examples of this include:
Design software for product and UX/UI design
Computers with graphic design capabilities
Prototyping tools and materials
Drawing tablets and styluses
Office furniture and workspace essentials
06. Register your industrial design business
Register your industrial design business in compliance with local regulations, obtain the required licenses and secure appropriate insurance coverage including liability and professional indemnity insurance..
Learn more: How to register a business, How to get a business license
Tips for managing your industrial design business for profitability
Once you’ve got your industrial design business off the ground, you’ll need to understand how to properly run and manage it in order to make sure it’s profitable. Here are some general tips on how to achieve that.
Research your industry and gain a deep understanding of the industrial design industry, including market competition, target demographics and emerging technologies. Stay updated on design tools and methodologies to offer cutting-edge solutions.
Develop a robust marketing strategy from the beginning to proactively promote your industrial design business. Create a professional website showcasing your portfolio, services and client testimonials. Utilize social media platforms for targeted marketing.
Prioritize delivering exceptional design services. Stay client-focused, meet project timelines and showcase your creativity and problem-solving skills.
Industrial design businesses to inspire (all built on Wix)
An original, modern jewelry brand created by designer Hila Rawet Karni. Inspired by industrial materials, the unique handmade collection features intriguing pieces of sophisticated jewelry.
A pioneer of the 3D printing industry in Tel-Aviv, where he still runs his studio making 3D models, whimsical miniatures, and dioramas.
Benefits of starting an industrial design business
Operating an industrial design business provides the opportunity to be your own boss, set flexible hours and make independent creative decisions. The demand for design services is consistently high, especially as businesses seek innovative solutions to differentiate themselves in the market.
Challenges of running an industrial design business
Industrial design management requires diverse skills, including creative thinking, project management and client communication. Balancing creative freedom with client expectations and ensuring timely delivery of design projects can be challenging.
How profitable is an industrial design business?
The profitability of an industrial design business depends on factors such as location, market demand, competition, pricing strategies and the ability to deliver high-quality design solutions. Building a reputation for innovative and visually appealing designs, along with effective business processes, contributes to higher profitability.