How to Start a Proofreading Business
Do Business the Right Way
Have you always wanted to start a proofreading business? Do you have a strong background in English, journalism, or a related field? A proofreading business will give you the opportunity to show off your command of grammar, spelling, and punctuation. Plus, it’s a fun way to get paid to read!
Below, we’ve done the legwork for you to provide a free guide to starting a home-based proofreading business today.
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What Does a Proofreading Business Do?
A proofreading business checks books, newspaper/magazine articles, advertisements, and business documents for spelling, grammar, and typing errors. Essentially, proofreaders provide ‘quality check’ without making substantial changes to the overall content.
Proofreaders are often confused with editors; however, their responsibilities are very different. An editor has the freedom to rewrite sentences or entire paragraphs with the intention of ensuring the document makes sense and clarifying areas of ambiguity. The job of a proofreader begins AFTER a project has been reviewed by an editor—just before a text is published or finalized.
Steps to Starting a Proofreading Business
Create a Business Plan for Your Proofreading Business
Before you get started, you’ll need an idea of what resources you’ll need—and how to monetize your business in a practical way. We’ve answered the biggest questions about clients, costs, and profits below.
Who is the target audience?
The target audience for a proofreading business is very wide. Potential clients can range from students seeking help with cover letters to publishing houses needing to contract out manuscripts of novels, academic texts, or other content. Although many companies will prefer the security of large, established businesses, hiring freelance proofreaders is very common.
According to Flexjobs.com, these are the top five types of business that often hire freelance proofreaders:
- Newspapers/magazine/book publishers
- Professional scientific/technical services
- Employment services
- Movie and video companies
- Advertising/PR services
As a new business, you’ll need to set your sights on local clientele before going after big, national companies. Building a solid client list takes time—especially in the writing field where the need for fast content can outweigh the desire for accuracy and well-written prose.
How do I get clients?
Currently, there are over 1.5 BILLION live websites! When you combine that with newspapers, magazines, advertisements, and all other forms of writing—it equals a lot of opportunities for your business! However, getting your foot through the door can be daunting. Here are a few steps you can take to land your first proofreading job:
- Create an online presence: Whether through LinkedIn, Meetup, or social media platforms, it’s important to create an online presence—clients won’t hire you until they know you’re ready to work. Promote your business, regularly post samples of your work, and connect with other proofreaders and companies you may want to work with in the future. You can even join professional group for proofreaders and editors such as ACES: The Society for Editors, Editorial Freelancers Association, or Northwest Editors Guild on Instagram, Twitter, and Facebook.
- Reach out to local businesses: Many retailers, specialty shops, and restaurants in your community will have websites, weekly newsletters, or advertisements that need proofreading. Contact local publishers or publications to see if they offer freelance opportunities.
- Check job boards: Websites such as Fiverr, Upwork, and Proofreading Pal will help you connect with prospective clients. For zero cost, you can create a professional profile where companies and individuals can see your resume, what types of projects you’re willing to take on, and contact information. Satisfied clients can also leave glowing reviews!
How does a proofreading business make money?
A proofreading business typically accepts projects on a case-by-case basis. When a client seeks you out, you can determine how you will get paid—hourly, per page, or per word—which may vary depending the type of project, size, and estimated time to complete the project.
How much money will it take to get started?
Most proofreading businesses will need a minimum of $2000 to get started; however, depending on what equipment and software you already own, it’s possible you could spend less.
If you need to upgrade your current laptop, you’ll need to spend a minimum of $1000. In addition, you may want to subscribe to editing programs such as PerfectIt, Grammarly, and Google Docs (between $99-$144 a year).
Becoming a certified proofreader is NOT absolutely necessary to own a successful proofreading business, but it does help.In fact, some companies will only contract out to certified businesses. Depending on your personal schedule, you can sign up for online or in-person courses. Check out what options your local colleges offer OR research online. You can also contact the U.S Proofreader Certification Association–they offer a test ($225 min.) you can take for certification.
How much do proofreading businesses make each year?
According to Salary.com, the average proofreading business makes $52,202 each year in the United States. However, nearly all states report an average of over $50,000. Alaska, California, and District of Columbia are among the highest paying—each topping $58,000. South Dakota, Mississippi, and West Virginia report the lowest averages—between $44,000 and $47,000.
How much should I charge?
Although many proofreaders will start out charging an hourly rate, those types of fees are really only warranted for short projects that aren’t very complex. Estimating how long it will take to complete longer tasks such as novels, legal documents, or medical transcripts can be difficult—especially when you’re just starting out. Offering quotes based on the total number of pages or word count is becoming much more commonplace—largely because it’s an upfront, clear pricing method for clients to understand. But, before you commit to a fee schedule, you need to consider the following:
- Your total word count/page count. Knowing how many pages/words you can read within an hour will ultimately determine how much you charge per hour, page, or word. Don’t be afraid to ask clients for samples of the project—this will help you establish a more accurate estimate of time and price.
- Your background. Average prices/rates will vary depending on genres—for example, legal documents and medical transcriptions have higher rates than mainstream publishing because those projects will require specific knowledge of law and medicine.
- Your business costs. It’s important to consider daily/monthly costs of office supplies, software, time developing your skills or learning new software, and financial cushions in case projects fall through.
According to The Editorial Freelancers Association, most freelance proofreaders read 9-13 pages an hour—each page containing around 250 words—and charge between $30-$35 an hour. So, you might charge $35 per hour OR around $12 per 1000 words. Determining your rate per page is a bit trickier as there’s a lot of variation in word count, depending on material. Assuming 250 words per page, $3 per page be roughly equivalent to $12 per 1000 words. However, higher rates might be justifiable for dense or difficult work or large, complex projects.
Select a Name for Your Proofreading Business
Have a great name idea? Before you start marketing and branding your business, you’ll need to ensure your name is available. Most states prohibit or restrict businesses from adopting names that are already in use. Even if it’s legally allowed, a copycat name puts your business at risk of a lawsuit.
See if your business name is available in your state with our Free Business Name Search.
Trademarks and Domain Names
Plan to trademark your business name? You can see if the trademark is available on a website like Trademarkia. It’s also a good idea to see if the domain name is available, which you can do on websites like Network Solutions and GoDaddy. Even if you don’t plan on putting together a website right away, you can buy the domain name to make sure no one takes it in the meantime.
Choose a Business Structure
Should you form an LLC? A sole proprietorship? Your choice of business structure will affect many aspects of your business, from liability to taxes.
Sole Proprietorships & General Partnerships
If you don’t file any paperwork to legally form a different kind of business—you have a sole proprietorship or general partnership. Essentially, these are “default” business structures. A sole proprietorship has one owner, and a partnership has multiple owners.
These structures have a few initial benefits. They’re easy, fast and cheap to start and maintain. However, the limitations and risks of these business structures quickly become more apparent as your business grows. In both of these business types, you are your business, legally speaking. Your company’s legal business name is YOUR name—so you’ll need a DBA to operate under any other name. Any business debt is YOUR personal debt. If anyone sues your business, they are suing YOU personally.
LLCs & Corporations
Limited liability companies (LLCs) and corporations are business entities formed at the state level. The entity is legally separate from its owners, meaning the owners are not personally liable for the debts and obligations of the business. As a separate entity, the business also has multiple tax election options. For example, both LLCs and corporations can choose to be taxed as S-corps if they meet the requirements.
LLCs and corporations are not quite as simple and inexpensive as default structures. LLCs and corporations come with formal requirements like state reports. They also have more fees than default structures, such as formation and annual report fees. However, the benefits of an LLC or corporation—especially liability protection and tax flexibility—are significant.
Legally Form Your Proofreading Business
If you opt for a sole proprietorship or general partnership, there’s no formal paperwork to file to legally create your entity—you just start selling your product or service. However, you will not have anyliability protections or tax flexibility.
LLCs and corporations are formed by filing paperwork with a state agency, typically the Secretary of State. To start an LLC, you file articles of organization. To start a corporation, you file articles of incorporation. In most states, you can file these forms online or download a paper form from the state’s website.
Whether you’re forming an LLC or corporation, your articles will require certain basic information about your business, such as your company’s:
- business address
- registered agent and office
- business purpose
- members/managers or directors/officers’ names and addresses
- number and type of authorized shares (for stock corporations)
You’ll also need the signature of someone authorized to sign on behalf of the business, along with the state’s filing fee. Fees vary by state but are typically between $100 and $200. If you hire Northwest to form your LLC or corporation, we complete and submit your formation paperwork on your behalf for just $100 plus state fees.
Create Internal Policies and Procedures
It’s important to put your company’s internal policies and procedures in a written document, especially if you’re starting your business with others. Partnerships have partnership agreements. LLCs have operating agreements. Corporations have bylaws.
These documents look a bit different for each kind of business, but they serve the same general purpose. They ensure there’s a clear path forward for any major issue that may arise, from changes in ownership to closing the business. LLCs and corporations also typically need an operating agreement or bylaws in order to open a bank account.
Get an EIN and Register for Taxes
Nearly all LLCs and corporations will need to request a federal employer identification number (EIN) from the IRS. If you file corporate income taxes, have employees, or file certain franchise taxes, you must have an EIN. An EIN is also a common requirement for opening a business bank account. Most businesses can request an EIN by filling out the IRS’s online form.
Your EIN is for federal taxes—but you’ll likely have state and local tax obligations as well. You will most likely need to set up an account with the state’s Department of Revenue, and you may need to apply for a state tax ID or a sales tax license as well.
Learn more about how to Get an EIN for your business.
Open a Bank Account
A business bank account keeps your personal finances separate from your business finances. For LLCs and corporations, keeping separate finances is essential for maintaining liability protection. To open an account, LLCs and corporations typically need to bring to the bank a copy of their articles, their operating agreement or bylaws, and their EIN.
Obtain Required Licenses and Permits
Many businesses will need a business license to operate. Licensing information—as well as any zoning requirements or other permits—can usually be found on the city or county website.
If your home is part of a homeowner’s association, you’ll also be subject to any of their restrictions for home-based businesses. Some areas may also require home-based businesses to obtain a Certificate of Occupancy (a document certifying the property owner has given the business permission to operate).
Next Steps for Your Proofreading Business
After your business is up and running, there are a few additional steps you may want to take as you grow:
- Get online: With your domain name, you can create a business website. You can hire a professional or use a website-builder like Wix or WordPress. You may also want to invest in online ads through a program like Google Ads.
- Hire employees: Hiring employees requires quite a few steps. You’ll need to collect W-4s and I-9s from employees, report the new hires to the state, set up withholding, pay for unemployment insurance, distribute any required documents and notices to employees, and display wage and safety info in the workplace. Employer.gov is a good place to start, followed by your state’s tax or labor office.
- Get business insurance: While LLCs and corporations protect you from personal liability, you don’t want your business to go bankrupt in the face of an accident, injury or other disaster. At minimum, it’s a good idea to look into general liability insurance. Home-based businesses can sometimes add insurance onto their homeowner’s policy.
How Do I Know if a Proofreading Business is for Me?
What’s it really like to work in a proofreading business?
In addition to spending a lot of time reading, proofreaders need to work closely with clients to negotiate prices, determine deadlines, schedule meetings or check-ins, and balance multiple projects. Working hours can be irregular and long. Deadlines can be changed and, sometimes, projects will be dropped altogether, so it’s important to be efficient with your time. However, in the beginning, you’ll put most of your efforts into finding job opportunities, marketing your business, networking, and establishing your rates.
What does it take to succeed in the world of proofreading?
Aside from a strong background and/or degree in English, journalism, or related field, a proofreader must be able to receive feedback from an author, publisher, or other business owner with grace and without imposing their own ideas. You must be able to stay focused, motivated, and organized throughout the entire editing process—especially when projects become long and technical. Although you may love the idea of getting paid to read, you won’t always be reading texts you love. But—with a wide range of clients—you’ll certainly never get bored!
Ready to Form an LLC or Corporation?
Northwest Registered Agent is here to help with all your small business ideas and needs. Answer a few simple questions about your business, and we’ll prepare and submit your formation paperwork to the state. We also provide your new business registered agent service, free business forms and guides, and much more.