How to Start a Sign Business

Even in the age of digital marketing, countless businesses and locals still use signs to spread the word and advertise. From store signage to street signs, and from yard signs to vinyl on vehicles, good signs boost visibility. 

The US sign industry is worth $14 billion and bouncing back nicely from a pandemic dip. You could start your own sign business, even from your home, grab a share of that growing market and provide a valuable service. 

But before you hit the ground running, you’ll need to learn how to start and manage the business. Luckily, you’ll learn everything you need to know in this step-by-step guide, and then be ready to launch your successful sign business.

Step 1: Decide if the Business Is Right for You

Pros and cons

Starting a sign business has pros and cons to consider before deciding if it’s right for you.

Sign industry trends

Industry size and growth

• Industry size and past growth – The US sign industry was worth $14 billion in 2021 after modest growth during the previous five years.((https://www.ibisworld.com/united-states/market-research-reports/billboard-sign-manufacturing-industry/)) 
• Growth forecast – The US sign industry is projected to grow modestly the next five years.
• Number of businesses – In 2021, 29,345 sign businesses were operating in the US. 
• Number of people employed – In 2021, the US sign industry employed 95,305 people. 

Trends and challenges

Trends in the sign industry include:

• Digital signs, which are messages that appear on digital screens, are becoming more and more prevalent in the market. You see them in lobbies, advertising the businesses inside, and in restaurants, with a series of rotating menu images. 
• QR codes on signs are becoming more popular, which people can scan to learn more about a company.
• Along with signs for businesses, personal events also offer a growing opportunity for sign businesses, as people are getting back to holding family events. 

Challenges in the sign industry include:

• The proliferation of online sign companies is making the industry more competitive.
• Emerging technologies in sign-making make it necessary for sign companies to continuously update their technology.

How much does it cost to start a sign business?

Startup costs for a sign business range from $7,300 to $17,000. Costs include equipment, a computer, and graphic design software for signs.

To learn some of the best ways to make signs, you can take online print production courses on sites like Udemy. 

You’ll need a handful of items to successfully launch your sign business, including: 

• Sign plotter
• Computer
• Graphic design software
• Substrates

How much can you earn from a sign business?

Prices for signs will vary based on the materials used and the time it takes. An average price of a street sign might be $50, which will probably be your largest segment of business unless you outsource larger store signs. 

These calculations will assume an average sale price will be about $150 since customers will probably want more than one sign. Your profit margin after costs of materials should be about 70%. 

In your first year or two, you could work from home and make 10 sales a week, bringing in $78,000 in annual revenue. This would mean $55,000 in profit, assuming that 70% margin. 

As your brand gains recognition and you get repeat business, sales could climb to 50 sales per week. At this stage, you’d rent a commercial space and hire staff, reducing your profit margin to around 30%. With annual revenue of $390,000, you’d make a fantastic profit of $117,000.

What barriers to entry are there?

The only barrier to entry that you’ll encounter is facing a competitive market.

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Step 2: Hone Your Idea

Now that you know what’s involved in starting a sign business, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an opportunity

Research sign businesses in your area and online to examine their products, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a yard card business or a sign-making business that also makes decals.

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as digital signage or window stickers and magnetic vinyl vehicle signs.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine your products or services

The signs that you make will depend on your sign-making equipment capabilities, or you could outsource the making of certain signs, reducing your profit margins. 

How much should you charge for signs?

Sign prices will depend on your costs and labor. You should aim for a profit margin of about 70% when you’re working by yourself. 

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will mainly be business owners. You can connect with them on LinkedIn or find them on Google or Yelp and call them directly. 

Where? Choose your business premises

In the early stages, you may want to run your business from home to keep costs low. But as your business grows, you’ll likely need to hire workers for various roles and may need to rent out a production facility or even a sign shop. You can find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

• Central location accessible via public transport
• Ventilated and spacious, with good natural light
• Flexible lease that can be extended as your business grows
• Ready-to-use space with no major renovations or repairs needed

Step 3: Brainstorm a Signage Company Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “signs” or “custom signs”, boosts SEO
• Name should allow for expansion, for ex: “NextGen Sign Solutions” over “Real Estate Signs”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Signage Company Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: Summarize the vision and strategy of your signage company, highlighting the range of sign products offered and the markets you aim to serve.
• Business Overview: Describe the types of signage your company will produce, including digital, outdoor, and custom business signs.
• Product and Services: List the services offered, such as design, production, installation, and maintenance of various types of signs.
• Market Analysis: Evaluate the demand for signage in your target market, identifying potential clients like businesses, schools, or event organizers.
• Competitive Analysis: Compare your company with other signage providers, focusing on your advantages in quality, technology, or turnaround time.
• Sales and Marketing: Outline your approach to attracting clients, using strategies like online marketing, partnerships with advertising agencies, or attending trade shows.
• Management Team: Highlight the experience and skills of your management team, particularly in design, production, and business operations.
• Operations Plan: Describe the production process, from design to manufacturing and installation, including quality control measures.
• Financial Plan: Provide an overview of start-up costs, pricing strategies, projected revenues, and profitability.
• Appendix: Include supplementary materials such as sample designs, client testimonials, or detailed market research to support your business plan.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to sign businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your sign business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have. 

Form Your LLC

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Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist, and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a sign business. You might also try crowdfunding if you have an innovative concept. 

Step 8: Apply for Sign Business Licenses and Permits

Starting a sign business requires obtaining a number of licenses and permits from local, state, and federal governments.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your sign business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as shopVOX, SQUARECOIL, or Better sign shop, to manage your projects, schedule, sales, and invoicing.

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

Marketing

Starting a sign business can be a lucrative venture, and effective marketing strategies are key to success. Beyond the basics of creating a website and networking, here are practical tips to help your sign business thrive:

1. Localized SEO Optimization: Ensure your online presence is optimized for local searches by incorporating location-based keywords, such as the city or region you serve, in your website content and meta tags.
2. Google My Business (GMB) Optimization: Claim and optimize your Google My Business listing with accurate business information, high-quality images, and positive customer reviews to enhance visibility in local search results.
3. Vehicle Wraps for Mobile Advertising: Turn your business vehicles into mobile billboards by incorporating eye-catching signage, promoting your services while on the move.
4. Strategic Partnerships with Real Estate Agents: Collaborate with local real estate agents to provide signage for property listings, boosting your exposure to a broader audience.
5. Community Event Sponsorship: Sponsor local events and community gatherings, providing signage for increased visibility and demonstrating your commitment to the community.
6. Referral Programs: Establish referral programs with local businesses, offering incentives for clients they refer to your sign business, creating a mutually beneficial network.
7. Social Media Engagement: Leverage social media platforms to showcase your portfolio, engage with the audience, and run targeted ads to reach potential customers.
8. Innovative In-Store Displays: Collaborate with local businesses to create innovative in-store displays that showcase your sign designs, attracting attention and potential customers.
9. Online Advertising Targeting Small Businesses: Utilize online advertising platforms, such as Google Ads and social media ads, targeting small businesses in your area searching for signage solutions.
10. Participation in Trade Shows: Attend relevant trade shows or industry events to showcase your sign business, network with potential clients, and stay updated on industry trends.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that set it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your sign business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your sign business could be:

• Custom magnetic vehicle signs to jumpstart your business
• Generate more traffic with stunning street signs
• Advertise discounts and specials and watch your sales spike! 

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a sign business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in signs for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in signs. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a sign business include:

• Sign Makers – make signs for customers
• General Manager – scheduling, ordering, accounting
• Marketing Lead – SEO strategies, social media, direct sales

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Sign Business – Start Making Money!

Good old-fashioned signs can still help businesses boost their bottom line, which is why they remain a big industry. If you have an eye for design and a desire to support businesses and locals, you can build a lucrative business — even a signage empire!

You have the business knowledge you need, so now it’s time to roll up your sleeves and launch your successful sign business.