Making the Move from Freelance to Small Business

As your freelance business gets more successful, you will start to think about making a move to becoming a small business. It’s not just a desirable prospect – it’s almost a necessity. The simple truth is that when you are in demand, you just won’t have the time to keep all your customers happy while seeking new clients. In short, you will need help.

There are, of course, many challenges involved in turning a freelance career into a successful small business. And in today’s guide, I’m going to go through a few of the things you will need to consider. Let’s take a closer look.




As a small business owner, you will have a lot more legal responsibility than you do as a freelancer. It’s advisable to hire a lawyer, who can talk you through employment law – and you might need an HR professional on board, too. Anyone you hire will have statutory rights, and there are tax and national insurance responsibilities, too. You will need to cover yourself with the right insurance, in case there is an accident or something goes wrong. While starting a small business can be exciting, there is a lot of legal groundwork to cover before you even get started.

Cash flow

The biggest difference between being freelance and running a business lies with your cash flow. When you freelance, it is possible to stretch yourself until your money comes in from your clients. However, from the second you start hiring people, they need to be paid – regularly. It is vital that you start getting a much tighter grip on your finances to allow you to do this. There are other things to consider, too. You might decide to move into an office, for example, which means regular payments for rent, rates, and utilities.


Contracts will start to take over your life – far more so than they ever did as a freelancer. You will have contracts for employees, suppliers, customers, delivery drivers – the list is endless. It is imperative that you are organized enough to ensure you have the right processes in place. Contract management software can help, and it might be an idea to hire someone that can deal with your general admin, too. When you are a small business, you will need to learn how to delegate, fast. It is a vastly different experience to the DIY approach used by freelancers.


If you want to take your freelance customers with you, it is imperative that you provide them with the same levels of service. But it can be tricky to do when you start hiring other employees and allowing them to work on your client accounts. Some customers will be extremely unhappy if they are suddenly lumped with an employee who just doesn’t perform as well as you. Excellent training is critical, to ensure those service levels remain constant. Your staff are a key asset, now – don’t training will help them avoid being a liability.

Making a move from freelancer to small business can be exciting, but there is a lot of work ahead. However, follow these simple guidelines, and you should enjoy some success. Good luck!