So you have decided to take the plunge. You have been a freelance Private Investigator for too long; making a profit for everyone you have ever worked for but just basically ‘scratching a living’. It’s time to take your efforts to a new level and branch out. So what do you do now? Well the transition from freelancer to setting up and running an agency may seem like an easy move to make……but is it?
Decisions you may encounter whilst making the transition.
- Will I set up my agency as a registered company or will I be a sole trader under an agency trading name?
- What name do I give my agency?
- Do I need an accountant?
- Do I need an office or will I continue working from home?
- Do I really need a web site?
- Where do I advertise my agency?
The first decision that you need to make is whether it is better for you to incorporate your business i.e. register it as a limited company with Companies House or whether to trade under a trading name.
Trading Name or Limited Company
The most straight forward method of setting up an agency is to trade as a sole trader under a trading name. There is no expense attached to setting up in this manner. Assuming that as a freelance Private Investigator you are already registered as ‘self employed’ then it is just a matter of choosing a trading name. On the other hand when you register a limited company there is registration and set up fees to pay as well as ongoing costs.
What name do I give my agency?
Naming your agency can leave you with some headaches. Firstly you need to think of and write down as many agency names as possible ‘avoid the cheesy ones at all costs’. You may think a name is catchy at first but decide further down the line that you want to change it; this can play havoc with marketing your business. It is worth spending quite a bit of time deciding on a trading name. Once you have decided on a trading name you need to carry out research to see if anyone already has the name. The last thing you want is finding out six to twelve months down the line that you have been trading under the same name as someone else, especially if they operate in the same industry as you or operate in the same area.
Do I need an accountant?
Many people who are self-employed and trading under a trading name carry out there own book keeping and complete their own tax returns. Accounting procedures for the sole trader are just as straight forward as they are for the self-employed freelancer. Sole traders that use an accountant will tell you that the accountancy fees are a lot less than they are for a limited company. In respect of a limited company, the accounting needs to be carried out in respect of the Company and your own tax liability. Unless you are competent in accounting procedures a company really needs an accountant. This obviously translates into larger accountancy fees.
Do I need an office or will I continue working from home?
As a freelancer generally all your work has come from Private Investigation agencies. No problem with a fellow PI knowing your home address; so you have had no real need of an office up until now. But is it essential that you have an office? You could continue to work from home but bearing in mind some of the work you undertake, do you really want to advertise your home address as your office? You could work from a post office box until you establish your agency. You may not need an office full time but just need a professional address to which correspondence can be delivered and the opportunity to rent office space when you need it. Local business centres are a godsend in these circumstances; they can be a cost effective alternative to having a full-time office space.
Ultimately though as time goes by and your agency becomes more successful you may need to hire staff or you may need to have a professional space in which to consult with a regular flow of clients. Renting an office full time can be one of the biggest expenses that you will encounter when running any business; so don’t rush head-long into it until your agency has sufficient turnover to sustain the costs.
Do I need a web site? / Where do I advertise my agency?
Both questions fall under the subject of marketing. These days, anyone that is in business needs an on-line presence. A decent web site can make all the difference when you are trying to market your PI agency and a professionally designed website doesn’t have to break the bank. To be effective in your marketing efforts you really need to use a variety of marketing sources. A good website is obviously one. Free internet directories are another. Paying for premium spots on web site directories can be effective. Paid advertising in printed publications is also another method. These methods can be costly which can be a concern to the fledgling PI business.
The less expensive and more modern approach to marketing your business is to use Social Media such as Facebook, Twitter, internet forums and blogging. Marketing via social media takes great effort and an immense amount of time and will not yield results overnight but is a very rewarding way of getting your business in front of as many people as possible.
- Companies Made Simple launches new UK Company Name Search free App (prweb.com)
- Limited Liability Company (turbotax.intuit.com)
- Tax Issues for Sole Traders (link4business.info)
- SJD Accountancy – Death of the Permanent Job (prweb.com)
- 2011 Trends: Content Marketing Is Critical to Ad Agency New Business (fuelingnewbusiness.com)
- January 28, 2011 Legal Guidance for Your Business: Tips for starting and running your small business (learnedatscore.wordpress.com)
- 10 tips for UX Freelancing (disambiguity.com)
- Why we should all thank the UK’s freelancers (telegraph.co.uk)