How To Set Up Charges For Professional Services Online

Near
Latest Posts

StartupNation inspires, educates and consistently attracts entrepreneurs and minor business owners from Main Street America who want to be their ain bosses and live the American Dream.

Like Lawrence Fuller, a financial services advisor in Scottsdale, Arizona, many professional services providers have daydreamed about the perks of self-employment. What's keeping these individuals, whether they're attorneys, psychologists, hairstylists or accountants, from becoming their own bosses?

According to Lawrence, it boils down to uppercase and chance. "The barriers to entry include the up-front costs and the confidence that the business organisation is going to be successful. Yous need to have a certain level of experience to be able to go out on your own, and y'all need the majuscule to start the business and run that loss until you build up the client base big plenty to earn a living." As the founding fellow member of Fuller Nugget Management (FAM), an investment management firm, Lawrence is doing simply that.

A former collegiate tennis player at the University of Northward Carolina – Chapel Hill, Lawrence followed his begetter Larry, a Merrill Lynch mutual fund manager, into the financial services business and worked for a variety of large investment firms.

What made Lawrence decide to pace off the terra firma of the corporate org chart and into the potential quicksand of cocky-employment? "The existent do good is the command," he answers without hesitation. "Having control over what I'grand doing and not having to sell proprietary products or services from a large firm. If I'm working for a big firm, I don't accept any command whatever every bit to what fees are charged the customer, not to mention how much of that fee I receive."

Once Lawrence chose to shoulder the adventure, launching the business came down to five steps that apply to many professional services businesses:

Securing necessary licensures
Establishing the firm's legal identity
Finding smart means to work with vendors
Establishing a place of business organisation
Marketing the business organisation to prospective clients

Footstep 1: Secure necessary licensures

"Lawrence spent about $1,400 to annals the firm as an investment counselor with the state of Arizona, and the National Association of Securities Dealers (NASD). To ensure that FAM complies with NASD requirements, the firm spends approximately $thirteen,000 per twelvemonth to retain the services of MarketCouncil, a specialized consulting group. "As a registered investment advisory business firm," Lawrence explains, "the NASD requires the states to keep books and records on the visitor and on our clients and their accounts."

Each blazon of professional services business will, of grade, have its own special licensure, compliance and regulatory issues and expenses. Entrepreneurs should consult with their industry'southward merchandise association to network with others in their field and to get a sense of what special requirements utilise to their businesses.

Stride 2: Plant the business firm's legal identity

Lawrence set FAM as a express liability company, or LLC. The firm besides incurred a ane-time expense to create an agreement by which clients consent to pay a fee for specific services. FAM'south initial legal fees amounted to $four,500, which covered founding the LLC, registering the business firm with the appropriate regulatory agencies, and drawing up the advisory understanding. In addition, Lawrence expects to spend about $1,000 per year for tax preparation.

Step 3: Notice smart ways to work with vendors

Lawrence urges new business owners to await for economical services offered by industry vendors. FAM, for instance, is a client of Fidelity and TD Ameritrade. They provide free operational dorsum-role support for FAM'due south clients, such every bit opening new accounts, supplying checks and ATM cards, and providing online account admission.

Lawrence has found other vendors for specialized products and services. For example, he spends $five,000 per year to license a software program to rail clients' assets. The software allows FAM to generate quarterly reports showing clients how their portfolios are performing, how much they've paid in fees, and which stocks and other avails are held in their accounts. Specialized software programs abound for professional service providers (eastward.g. for medical billing, accounting, insurance) which may crave a big upfront investment, but pay off in the long run by enhancing efficiency and client service.

Step 4: Found a place of business

Lawrence leases function space on a flooring shared past most 20 other modest businesses. The cost is $900 per month, and includes utilities and a receptionist who serves all the businesses on the flooring. A common conference room at the entrance to the suite tin can exist reserved for client meetings. "The office in Scottsdale is really a small boiler room," Lawrence says. "Information technology'south non designed to encounter with clients, but the rent is very low and includes everything – our phone, our internet access, and rent."

Finally, Lawrence incurred miscellaneous costs to ready the office. For instance, he spent about $iii,000 on office furniture, including two big workstation desks, 2 filing drawers, a storage cabinet, and a bookshelf. He also spent $2,000 on desktop computers and about $600 on a colour laser printer.

Step 5: Market the firm to clients

Image is important in the financial services business concern, and so Lawrence decided to spring for a 17-folio glossy brochure with a custom-designed logo. The brochure cost $four,000 to produce, plus an ongoing cost of about $15 per unit for printing. The brochures are given to new and prospective clients and handed out at small-group meetings, only at this time Lawrence uses no more than ten of them per quarter.

To design and host the Fuller Asset Management website, Lawrence spent approximately $500 upfront, and now spends $600 a yr for ongoing design and hosting. There are a variety of website blueprint and hosting companies from which to cull according to your budget and needs, only Lawrence chose to go with a visitor that could create his website using templates, equally opposed to paying for a completely new, custom design.

Lesser Line

All in all, Lawrence spent approximately $35,650 to open FAM for business:

Licensures and compliance – $14,400
Legal services – $iv,500
Specialized software – $5,000
Office equipment and computers – $v,600
Eolith on function – $900
Marketing (website & brochures) – $5,250

"I kept sure costs extremely low, and focused a lot of our operating upkeep on a few things, one of those being the brochure, which is the outward projection of the house to our prospective client base of operations," Lawrence explains. His clients are individuals and small business owners, and all of his business is through referral.

Lawrence is quick to admit his biggest error: "Not having done this a long fourth dimension ago," he says. "There is absolutely nothing I'd rather be doing."

Melissa Martin is a freelance writer for StartupNation.