A modeling agency is a company that primarily represents fashion models, and they work for the fashion industry. Modeling agencies book jobs for represented models, select jobs that align with the model’s brand, and help with the model’s development.
Modeling agencies usually earn their income via commission, and this is from the deal they make with the model and/or the head agency. Available statistics show that the market size of the modeling agency sector in the United States is put at $1.6 billion and the industry is expected to increase by 1.9 percent in 2023.
The US talent and modeling agency industry includes about 4,100 establishments (single-location companies and branches of multi-location companies) with combined annual revenue of about $8 billion, as well as many sole proprietorships with no paid employees.
Steps on How to Start Modeling Agency
Table of Content
Conduct Market Research
Conducting market research before starting any business is key to the success of the business hence you must not start a modeling agency without conducting market research. Market research provides critical information about your market and your business landscape.
It can tell you how your business is perceived by your target customers, it can help you determine who and where your customers are, and which customers are most likely to do business with you. In essence, thorough market research will help you understand how your target customers think.
a. Who is the Target Market for Modeling Agency?
- Models
- Players in the fashion industry
- The beauty care and cosmetics companies
- Advertising and branding agencies.
b. Is Modeling Agency a Profitable Business?
Yes, the modeling agency industry is profitable. The Model Agencies industry revenue is anticipated to increase in 2023 as corporate profit and total advertising expenditure continue to recover from the COVID-19 (coronavirus) pandemic. Plus, the industry is projected to be worth $1.6 billion in 2023.
c. Are There Existing Niches in the Industry?
No, there are no existing niches when it comes to the modeling agency line of business.
d. Who are the Major Competitors?
- Wilhelmina International Inc.
- Elite World SA
- Ford Models
- DNA Model Management LLC
- IMG Models
- Representing clients
- Managing models
- Advertising talent
- Training talent
- Scout Model & Talent Agency
- Next Model Management
- The Society of New York
- New York Model Management
- Silent Models New York
- Zoli Agency
- Look Model Agency
- Marilyn Agency
- Select Model Management
- Storm Model Management
- The Lions.
e. Are There County or State Regulations or Zoning Laws for Modeling Agencies?
No, there are no county or state regulations and zoning laws for modeling agencies, but players in this industry are expected to work with the existing regulations governing such business in the county or state where their business is domiciled.
f. Is There a Franchise for Modeling Agency?
No, there are no franchise opportunities in the modeling agency business.
g. What Do You Need to Start a Modeling Agency?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Office facility
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Office Equipment
- Employees
- Startup Capital
Choose a Memorable Business Name
When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.
Some of the catchy business name ideas suitable for a modeling agency business are;
Creative Modeling Agency Business Name ideas
- The Babes© Modeling Agency, Inc.
- Philadelphian Connect® Modeling Agency, LLC
- Moris Jackson© Modeling Agency, Inc.
- Runway Solutions® Modeling Agency, Inc.
- Mason Gray™ Modeling Agency, Inc.
- Fancy Moses™ Modeling Agency, LLC.
- Jolly Fellow© Modeling Agency, LLC
- Jonny Moore® Modeling Agency, Inc.
- Kiss Palmer© Modeling Agency, Inc.
- Anthonio© Modeling Agency, Inc.
- Rick Larson and Sons® Modeling Agency, LLC
- Rolly Dolly® Modeling Agency, LLC
- Emily Elton™ Modeling Agency, LLC
- Tyler Benston© Modeling Agency, Inc.
- Tick Tim® Modeling Agency, Inc.
- Edith Adams™ Modeling Agency, Inc.
- Flourish Flowers™ Modeling Agency, Inc.
- Anderson Global© Modeling Agency, Inc.
- Al Simpleton® Modeling Agency, LLC
- Francese Rowland™ Modeling Agency, Inc.
Register Your Business
a. What Type of Business Structure is Best for Modeling Agency?
The truth is that you have several options when it comes to the business structure of a modeling agency, but the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.
Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Start a Modeling Agency?
- General Business License
- Zonal Permits
- Signage Permit
- Operational State Facility Inspections
d. What Type of Certification is Needed to Start Modeling Agency?
You don’t need any certifications to start a modeling agency.
e. What Documents are Needed to Start Modeling Agency?
- DBA
- EIN
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Online Terms of Use
- Online Privacy Policy Document
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering starting a modeling agency, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Modeling Agency?
To be truthful, the cost required to start a modeling agency may vary significantly and it could be high, moderate, or low. But on average, you can budget between $5,000 to over $100,000 to start your modeling agency.
b. What are the Costs Involved in Starting a Modeling Agency
- The total fee for registering a business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services total – $1,200.
- Marketing promotion expenses (2,000 flyers at $0.04 per copy) for the total amount of $80.
- The cost for hiring a business consultant (writing of business plans inclusive) – $2,500.
- Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $2,400.
- The cost of accounting software, CRM software, and payroll software – $1,500
- The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of – $25,600.
- The cost for facility remodeling – $5,000.
- Other start-up expenses including stationery – $500
- Phone and utility deposits will cost – ($2,500)
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $30,000
- The cost for store equipment (cash register, security, ventilation, signage) – $3,150
- The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound systems, tables and chairs et al) – $8,000.
- The cost of launching an official website – $600
- The cost for your grand starting party – $3,000
- Miscellaneous – $2,500
c. What Factors Determine the Cost of Starting a Modeling Agency?
- The size of the modeling agency
- The choice of location
- The required licenses and permits
- The type of facility
- The type of additional services offerings
- The cost for branding, promotion, and marketing of the modeling agency
- The cost of furnishing and equipping the facility
- The cost of the insurance policy covers
- The cost of registering the business
- Cost of recruiting and training your staff
- The cost for the grand opening of the modeling agency
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
It is not compulsory to build a new facility for your modeling agency, but if you have the required finance, you may want to build your own facility.
e. What are the Ongoing Expenses of a Modeling Agency?
- Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
- Transportations of models and staff members
- Salaries of employees and models
f. What is the Average Salary of your Staff?
- Chief Executive Officer – $52,000 Per Year
- Admin and HR Manager – $35,000 Per Year
- Modeling Consultant – $32,000 Per Year
- Marketing and Sales Executive $30,000 Per Year
- Accountant – $30,000 Per Year
- Customer Care Executive / Front Desk Officer – $28,000 Per Year
g. How Do You Get Funding to Start a Modeling Agency
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Bella Ruston™ Modeling Agency, Inc. is a world-class modeling agency that will be located in Los Angeles – California. We have been able to secure a standard and well–positioned office facility in a central business district in Inglewood. We are set to compete in the highly competitive modeling agency industry not only in the United States market but also in the global market.
b. Products and Service
- Scouting talent
- Negotiating contracts
- Representing clients
- Managing models
- Advertising talent
- Training talent.
c. Mission Statement
Our mission is to provide professional and highly creative modeling agency services that will assist businesses, individuals, and non-profit organizations in promoting their brands. We want to build a modeling agency that can favorably compete with other leading brands in the modeling agencies industry.
Vision Statement
Our vision is to establish a standard and world-class modeling agency whose services and brand will not only be accepted in the United States of America but also other parts of the world.
d. Goals and Objectives
The goals and objectives of the modeling agency are to represent fashion models in business dealings, such as auditions, bookings, and contract negotiation.
e. Organizational Structure
- Chief Executive Officer
- Admin and HR Manager
- Modeling Consultant
- Marketing and Sales Executive
- Accountant
- Customer Care Executive/Front Desk Officer
Marketing Plan
a. SWOT Analysis
Strength:
- Ideal location for a modeling agency
- Highly experienced and qualified employees and management
- Access to a pool of talented models
- Availability of different types of modeling-related services.
Weakness:
- Financial constraints may restrict the publicity and branding of the business
- A new business that will be competing with well-established modeling agencies in the city
- Inability to retain our highly experienced and qualified models and employees longer than we want during the teething stage of the business.
Opportunities:
- Rising consumer spending is poised to benefit the industry. As consumer spending rises, companies will increasingly use advertising campaigns, which include models, to push products to consumers.
- Online market, new services, new technology, and of course the starting of new markets.
Threat:
- The arrival of a new modeling agency within our market space
- Low demand during the pandemic will reduce industry profitability.
- Economic uncertainty
- Liability problems
- The government could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
b. How Do Modeling Agencies Make Money?
Modeling agencies make money (commissions) by offering the following services;
- Commissions from advertising agencies
- Performance or project-related contracts
- Product licenses.
c. Payment Options
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
d. Sales & Advertising Strategies
- Introduce your modeling agency by sending introductory letters alongside your brochure to advertising agencies, fashion companies, corporate organizations, and other key stakeholders throughout the city where your modeling agency is located.
- Advertise on the internet on blogs and forums, and also on social media like Pinterest, Twitter, Facebook, and LinkedIn to get your message across
- Create a basic website for your business to give your business an online presence
- Join local modeling agency associations for industry trends and tips
- Advertise our business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word-of-mouth marketing (referrals)
Financial Projection
a. How Much Should You Charge for your Product/Service?
Modeling agencies don’t charge their clients but they operate based on commissions as agreed by both parties.
b. How Much Profit Do Modeling Agency Owners Make a Year?
It depends, but available reports show that on average, a small to medium-sized modeling agency can earn anywhere from $50,000 to $120,000 in personal income.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the modeling agency
- The types of services offered
- The location the modeling agency is covering
- The management style of the modeling agency
- The business approach of the modeling agency
- The advertising and marketing strategies adopted by the modeling agency.
- The number of years the modeling agency is in business
d. What is the Profit Margin of a Modeling Agency?
Please note that modeling agents’ commissions are based on the bulk of their income.
e. What is the Sales Forecast?
Below is the sales forecast for a modeling agency. It is based on the location of the business and other factors as it relates to such startups in the United States;
- First Fiscal Year: $320,000
- Second Fiscal Year: $450,000
- Third Fiscal Year: $540,000
Set Up your Office
a. How Do You Choose a Perfect Location for Modeling Agency?
- The demography of the location especially as it relates to models
- The demand for the services offered by modeling agencies in the location
- Accessibility of the location
- The number of modeling agencies in the location in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Start a Modeling Agency?
- Las Vegas, Nevada
- Los Angeles, California
- Ponte Vedra Beach, Florida
- Dallas, Texas
- Silver Spring, Maryland
- Rowland Heights, California
- Portland, Oregon
- Oak Lawn, Illinois
- Green Bay, Wisconsin
- New York City, New York
c. What Equipment is Needed to Operate a Modeling Agency?
- Booking software
- Computers and laptops
- Printers
- Telephone
- Fax machine
Hire Employees
When it comes to hiring employees for a standard modeling agency, you should make plans to hire a competent chief executive officer (you can occupy this position), human resource and admin manager, accountant, modeling consultants, and call center agents.
Launch the Business Proper
In recent times, no modeling agency opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening party if you are operating on a low budget or you can go for a grand opening party.
The bottom line is that with a proper launching of the modeling agency, you will officially inform people in your city that your modeling agency is open for business.
a. What Makes modeling Agency Successful?
- Choose a good location and office facility to launch the business
- Make sure your partner with key stakeholders and offer a wide range of modeling-related services (give your customers options)
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your modeling agency
- Leverage all available online and offline platforms to promote your modeling agency
b. What Happens During a Typical Day at a Modeling Agency?
- The office is open for the day’s work
- The walk-in areas, chairs, and tables are properly arranged
- Auditioning of models
- Modeling activities are carried out in different locations as requested by clients
- Reports are written and submitted to superior officers
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build Modeling Agency?
- Excellent talent hunting and management skills
- Excellent customer services skills
- Excellent organizational skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining skill
- Work experience in a modeling agency
- Experience in managing people
- Experience in business administration.