How to start a small business on Instagram

Show your business off and start selling to Instagram’s nearly one billion strong user base. Learn how to set up your very own small business on Instagram and get started on advertising in this article.

We’ll walk you through our three-step process to get you started with your small business and give you our top tips to improve your marketing and grow your business more effectively. Find out: 

  • Start a small business on Instagram in three steps
  • Our top tips to level up your content on Instagram
  • Ways to finance your business
  • Run your new business more efficiently with Countingup

At Countingup, we want to empower your entrance into the world of business. Find out how to start selling with ease on one of the world’s biggest social media platforms and save time to grow your sales below.

Start a small business on Instagram in three steps

Step 1: Take care of the legal and formal stuff

Running a business means having to deal with customers, products, and more formal elements like legal forms and admin. So even though it can be dry, it’s nonetheless important.

Set up your Instagram account

You can’t sell on Instagram without an account so one of the earliest things you should do is make an account with the name you’d like to use. To do this, create a new personal account then switch to a business account using your settings. Instagram has a helpful guide available here for further help.

Having a strong brand name for your business is very important as it sits at the heart of your wider business image. If you already have an account name idea, you may also wish to set up accounts on other social media platforms like Facebook and Twitter to help make sure the name you choose is only ever yours. If you need ideas for a name, try to make it catchy or descriptive about your offers to customers.

Set up your a business website

Instagram is currently rolling out a comprehensive eCommerce platform that handles purchases entirely in-app in their shopping tab, however, it’s only available to US users as of yet. 

Until this is available in the UK, you’ll need a dedicated website to link your account and products to in order to handle the purchase. Nowadays, creating a website for your business has never been easier. Learn more about setting one up in our guide How to make your own website.

Set up your business legally

There are two main ways to set up a new business in the UK: become a sole trader or establish a limited company

Each option allows you to keep the profits from your business and handle your taxes, however, each business is run very differently and provides you with different advantages as you grow. We discuss this further to help you decide in our article How to set up your business: Sole trader or limited company?

It’s worth noting that you can start selling even when you’ve not registered your new business yet, as new entrepreneurs are given a trading allowance. This is a tax-free allowance on your new business’ net profits, meaning you can earn up to £1,000 while you handle the paperwork to establish your business with HMRC.

Do you need insurance?

As you’re selling online, your business’ insurance needs will be lower as you may not have employees yet, nor will you need public liability insurance. However, you may still benefit from insurance policies to cover your stock or vehicle if you’re driving for business purposes. Learn more in our article What insurance does my small business need?

Step 2: Find your niche and develop your business

If you’ve decided to sell on Instagram, you’ll likely already have a product or service in mind that you want to offer customers. Even if you have something deliverable to customers, you may wish to take some time to reflect and consider how to improve it.

Whether this is in refining your service’s processes or product’s materials or packaging, your business won’t be successful if you don’t think about how you can improve. For example, can you benefit from apps or software to save time? If you’re at an earlier stage in your business journey, read our article How to come up with a business idea

Beyond your business’ offers you’ll also need to consider how it’ll run. A well researched and forethought business can help you overcome difficulties and identify opportunities. Specifically, you’ll need things like a business plan and budget.

Step 3: Start marketing on Instagram

Marketing on Instagram is very easy for small businesses as there are a number of tools and features readily available.

Instagram is primarily a photo-sharing platform and so you’ll need to learn how to take decent quality photos of your products that show parts of your services (especially things like before and afters). Your two main concerns as you start out should be the framing and lighting of pictures; consider: 

  • What’s shown in the picture: what’s in focus? How big or small does it seem in comparison to what else is there? Does the framing adequately draw focus to what you want it to?
  • How it looks: does the lighting make colours pop? Does it highlight important features (like logos or design)? Does 

Fortunately, the Instagram app offers lots of editing capabilities to help you touch up and post a more polished version of them. Instagram also allows you to ‘tag’ content with hashtags that describe its topic, who or where it’s relevant to and what’s shown in it. This then goes onto feed user information and can help new users discover your business more easily.

If you’d like to learn more about marketing basics, including how to create a more organised strategy, read our articles What is small business marketing? and How to create a marketing strategy for small businesses.

Get through to your target customer

Creating good content is only half of the story, you’ll also need to learn how to cut through the noise and make sure your posts reach the right people. You can do this by researching your target market.

You may have already come across this as you plan your business, but if not, a target market is the portion of people who are more likely to buy from your business as your offers align more with their interests or needs. Understanding how to communicate your value when catering to their needs is vital, as it’ll increase the likelihood that you’ll get sales. Learn more about building a target market profile using the link above and think about how you can incorporate your information into your post tags for more organic engagement.

Paid advertising

Even with great content, you can ensure your Instagram posts and product listings reach your target market using paid promotion tools. This usually involves paying Instagram a fee for circulating a certain post so that more people see it. 

Paid promotion tools work in two ways: wider or target circulation. Wider circulation works much like normal posts except they are seen by more people. Target circulation uses Instagram’s user data and places your post more strategically so it’s seen by a higher portion of your intended audience. You’ll still need to help by giving Instagram some initial information like the niche your business occupies, the area it serves or the types of people who might like your offers.

Our top tips to level up your content on Instagram

As previously mentioned, Instagram has a number of innovative features that help small businesses grow, however, there are also certain pitfalls that you should know to avoid to help improve your content. It’s worth noting that paid promotion works best when you have high-quality content – the success of your advertisements still relies on people being interested.  Find out more below:

Watch out for compression

‘Compression’ happens when an image or video is shrunk so that it’s easier to share online. While this makes download speeds faster, it comes at the cost of image quality. If your pictures feature very detailed elements (for example, if you’re selling art on Instagram), you’ll need to be careful to minimise this loss. Try to always take high-resolution pictures with your phone or camera so the least amount of image quality is lost.

Engagement features

Instagram leads the way in engagement features in its stories that help make our content more interesting to those who view it. Make sure to experiment with different and newly available features to make sure your business is keeping pace with the expectations and demands of users on social media.

Play with the Instagram layout

Instagram is particularly famous for its 3×3 layout. This has inspired a number of different content formats that capitalise on breaking up larger photos (to avoid compression) and creating sub-posts of the same image broken over the grid.

However, a more modern grid format is to create rows wherein each line of the grid, featuring 3 posts each, has a consistent theme. This helps your customers see the thought and quality in the content you provide and can heighten the perceived value in your business’ offers on this basis. 

BTS content and Reels

Instagram has published ‘Reels’, a short-form vertical video format, similar to those offered by TikTok. Small businesses and bloggers on Instagram have found this content medium to be particularly effective to help share BTS (or ‘behind the scenes’) features of what they do. 

This marketing style can help customers perceive a more intimate relationship with your business by inviting them to see the process behind your product or service. This can help them understand your value and helps reduce your burden of always having fresh, dazzling content all the time.

Background photo quality

If you sell products, you may want to pay particular attention to what your products are photographed against, particularly the background elements and features. Your options will depend on the size of your products, however, popular backgrounds can include brick walls, pieces of slate or wood, water baths, colour monoblocks, and more. These may change as different tastes evolve, so make sure to keep your marketing materials fresh and high-quality.

Giveaways, influencer collaborations, and sales

Like any other marketing tactic, sales and giveaways always do well. It shouldn’t come as a surprise that people like free things. However, Instagram has helped somewhat flip this format as you can give influencers (popular people on Instagram that champion certain topics or niche interest) free products to feature on their pages. 

Like giveaways and discounted products, customers benefit from learning more about your product or service and you benefit from (more or less) free advertising.

Ways to finance your business

If you’ve identified a shortfall in your growth plan and budget, you may need to source money to help make it achievable. Business financing is a fairly standard topic which is why we have guides available on it here: How to finance a business and What’s the best source of finance for small businesses?

Keep organised when it comes to your business finances

With so much to think about and get set up as you launch a business, you shouldn’t overlook ways to save time and stress. 

That’s why thousands of UK business owners are using the Countingup app to save time on their financial admin and focus on growing their business. 

Countingup is the business current account and accounting software in one app. It automates time-consuming bookkeeping admin for self-employed people across the UK.

Having a dedicated business account for your new Instagram business income will help you keep organised financial records. And with special tools including automatic expense categorisation, receipt capture tools and cash flow insights, you can confidently keep on top of your business finances and save yourself hours of accounting admin – even while on the go. 

Use your phone to run your business – marketing your product with Instagram and managing your finances with Countingup. Find out more here and sign up for free today.