How to Start a Live Scan Fingerprinting Business | SkillsAndTech

As technology advances and security concerns increase, demand is growing sharply for more advanced identification techniques, such as digital fingerprinting. The fingerprint sensor market is expected to see explosive growth in the years ahead, making now a good time to consider getting in early and riding the wave to success. 

Of course, starting a business is hard work, and requires patience. Thankfully, you’ve come to the right place, as this step-by-step guide lays out all you need to know to develop, launch, and reap the rewards of a successful biometric fingerprinting business.

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Scan the below to begin your future.

Decide if the Business Is Right for You

Like all businesses, running a live scan fingerprinting business will suit some people and circumstances more than others.

This industry may particularly suit those who want a flexible mobile business or someone who already has a brick-and-mortar storefront and is looking for a new income stream.

Let’s take a look at some of the pros and cons. 

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Pros and cons

Pros

• Flexibility — can be mobile or a side business
• Fast-growing demand ensures sales
• Low startup costs

Cons

• Stringent requirements and certification
• Highly regulated space with harsh penalties
• Agencies have varied demands, requiring different skills & equipment

Live scan fingerprinting industry trends

Nearly all employers (96%) conduct some sort of background check on potential employees these days, driving demand for security checks such as fingerprinting. Demand for background checks for other purposes, such as for a tenancy or hospitality, has also increased as consumers and businesses have embraced broader uses of technology to address security concerns. 

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Industry size and growth

• Industry size and past growth – Industry analyst Markets and Markets values the global fingerprint sensor market at $3.5 billion.
• Growth forecast – Markets and Markets expects impressive 11% annual growth through 2026, creating a $5.8 billion industry while analyst Allied Market Research foresees the global background screening industry, of which fingerprint scans represent the largest share, doubling in size by 2028, to nearly $10 billion.\

Trends and challenges

Trends shaping the live scan fingerprinting industry include:

• Rising adoption of biometric systems
• Use of fingerprint sensors in smartphones
• Facial recognition and iris scanning are gaining popularity  

Challenges in the live scan fingerprinting industry include;

• Stringent regulations
• Discrimination concerns 

What kind of people work in live scan fingerprinting?

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• Gender – 64% of fingerprint technicians are female, while 36% are male.
• Average level of education – 40% of fingerprint technicians hold a bachelor’s degree.
• Average age – The average age of a fingerprint technician is 39 years old.

How much does it cost to start a live scan fingerprinting business?

The cost of starting a live scan fingerprinting business varies widely depending upon the approach you take.

A mobile business with no physical storefront can cost as little as $5,000 to get going. At the other end of the scale, starting a brick-and-mortar business with a vehicle for mobile services and a fingerprint technician will cost around $20,000.

The average startup cost is $12,500. A more detailed breakdown of the costs involved in starting up this sort of business can be found in the table below.

Start-up Costs	Ballpark Range	Average
Licenses and permits	$100 – $200	$150
Training and certification	$100 – $900	$500
Insurance	$300 – $1,000	$650
Live scan equipment	$1,000 – $3,000	$2,000
Live scan software	$2,500 – $2,500	$2,500
Firewall	$300 – $300	$300
Office furniture and equipment	$0 – $2,000	$1,000
Office decor	$0 – $1,000	$500
Office supplies	$0 – $500	$250
Marketing and advertising	$500 – $3,000	$1,750
Website and software	$200 – $500	$350
Hiring	$0 – $100	$50
Car for mobile services	$0-$5,000	$2,500
Total	$5,000-$20,000	$12,500

How much can you earn from a live scan fingerprinting business?

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Revenue from a live scan fingerprinting business depends upon the number of clients you serve on a monthly basis. The average industry charge is $25 for a 15-minute appointment. This figure does not include additional charges for transportation for on-site service, or any relevant agency fees.

For a mobile business attracting on average 5 appointments a day for five days in a week, annual revenue will be about $33,000 annually. Your pre-tax profit would be around $26,000, assuming a profit margin of 80%.

A business with a physical storefront and mobile services, on the other hand, may expect 15-20 clients in the shop, and an additional 5 appointments for mobile services on a daily basis. At an average of 23 appointments per day, the gross revenue in this case will be around $150,000 per year. Your profit margin will likely be reduced to 50% considering your higher overhead costs, but you’d still make a tidy profit of $75,000.

As your company gains in popularity you may consider opening additional branches, in which case the revenue and profitability will grow accordingly. If you grow to three locations by the third year and average 25 appointments per day in each branch, you may expect to earn nearly $490,000 in sales, which translates to almost $245,000 in profit.

What barriers to entry are there?

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As with all businesses, there are some barriers to entry to consider.

As security is a highly regulated industry, there are strict regulations, training, and certification requirements to take into account. These will need to be kept up to date and may require payment of a fee.

You may want to get more professional training before launching your live scan fingerprinting business in addition to the Fingerprint Rolling Certification from the DOJ. A few organizations offer advanced fingerprint training to help you to avoid any regulatory hurdles or harsh penalties.

These programs include Start a Live Scan Fingerprinting Business by Live Scan Classes, the Live Scan Course from Print Scan, and Fingerprint Technician Training by the Fingerprint Technician. 

Some government bodies, such as the National Air Transportation Association, require the fingerprint technician to be a US citizen. Don’t forget to check out what each organization requires in order to become a certified fingerprint roller.

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The US Department of Justice requires that fingerprint technicians do not have a criminal record. As a result, it requires applicants to undergo a criminal history and background check before taking up work in this field.

To ensure that fingerprint technicians are able to perform their work accurately, the Department of Justice also requires they hold a Fingerprint Rolling Certification. To become certified, you must take the following steps:

• Study the Fingerprint Rolling Certification Program Reference Handbook to obtain this self-study certification
• Fill in an application in the state in which you want to start your business
• Get your fingerprints rolled at a live scanning center
• Submit the completed application to the Justice Department with a nominal fee ($74 at the time of writing)

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Related Business Ideas

If you’re still not sure whether this business idea is the right choice for you, here are some related business opportunities to help you on your path to entrepreneurial success.

Hone Your Idea

Now that you have a good idea of what the business entails, let’s take a look at some of the finer points of what your live scan fingerprinting business might offer, and how it will work.

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Why? Identify an opportunity

Demand for electronically filed fingerprints is on the rise amid a growing desire for secure identification systems. As a part of their background checks, job applicants, volunteers, and working professionals such as doctors, teachers, lawyers and other corporate staff are increasingly required by their employers to have their fingerprints scanned. 

It is imperative to understand how live scan fingerprinting works. A technician rolls the employee’s fingers across a glass plate to record the digital fingerprints. The print is submitted to state and federal agencies as well as the Department of Justice for authentication and a background check.

The outcome of the process will be shared with the employer organization, while the electronic copy of the scanned fingerprints are destroyed as soon as the results are obtained. This ensures the security of the employee’s private information.

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The digital fingerprints requirement has created a sizable market for live scan fingerprinting businesses, which translates to a potentially profitable business opportunity. Although anyone can start and profit from a live scan fingerprinting business, the demand also creates an opportunity for existing firms to offer live scan fingerprinting as an additional service to their clients.

For example, if you are a notary public you may want to offer fingerprinting services to boost revenue with minimal additional costs.

What? Determine your products or services

Fingerprint scanning is a standardized service, making it very difficult to differentiate your products and services from those of your competitors. As a result, there is very little brand loyalty as the cost of switching to a competitor is effectively zero.

Fingerprint recording businesses are likely to offer two main services. These are:

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Live scan fingerprinting: A scan of the fingerprint is recorded electronically through a biometric machine and submitted to the relevant organizations. Live scan is a popular method due to the clarity of the fingerprints, reducing the chance of rejection by any agency.

Fingerprint cards: A more conventional method of fingerprint collection, fingerprint cards can capture fingerprints either through ink or live scan printing. The latter is preferred due to the clear image of fingerprints. Each organization will have their own fingerprint cards.

A few examples of the specific purpose for live scan fingerprinting include an FBI background check, a Financial Industry Regulatory Authority (FINRA) background check, tenant screening, hospitality screening, and child identification (Kidscan).

How much should you charge for live scan fingerprinting?

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The cost of live scan fingerprinting to the client varies depending upon the type of service and the organization to which the prints are submitted. As of mid-2021, the FBI charges $17 and the DOJ $25 for a record review based on the submitted prints.

The rolling fee charged by the scanning technician ranges between $20 and $30, averaging $25 per appointment. Thus, if a client needs an FBI background check and DOJ record review together, you should charge $67, which allocates $17 to the FBI, $25 to the Justice Department and $25 as your fee. 

Some clients might ask you to visit their home or place of business to take fingerprints, for which an additional transportation charge would be levied. Once you know your costs, use the Step By Step profit margin calculator to determine your price points.

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Who? Identify your target market

Clients can be drawn from two main groups: consumers and businesses. 

As explained above, employees and volunteers are increasingly being asked to have their fingerprints scanned, and may seek out your services individually.

Alternatively, a relationship can be built with businesses and organizations that regularly require new employees and volunteers to submit scans, leading to repeat custom. Examples of this kind might include state agencies such as the FBI or state departments of law enforcement. They might also cover private sector organizations which require a security check, such as financial institutions, real estate brokers, medical practices, and law firms.

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Where? Choose your business premises

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

Brainstorm a Business Name

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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 
• The name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “stitches” or “embroidery”, boosts SEO
• Choose a name that allows for expansion: “Jim’s Bakery” over “Jim’s Cookies”
• 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.

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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 set 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. 

Create a Business Plan

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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: Brief overview of the entire business plan; should be written after the plan is complete.
• Business Overview: Overview of the company, vision, mission, ownership, and corporate goals.
• Product and Services: Describe your embroidery products and services in detail.
• Market Analysis: Assess market trends such as variations in demand and prospects for growth, and do a SWOT analysis.
• Competitive Analysis: Analyze main competitors, assess their strengths and weaknesses, and create a list of the advantages of your services.
• Sales and Marketing: Examine your companies’ unique selling propositions (USPs) and develop sales, marketing, and promotional strategies.
• Management Team: Overview of management team, detailing their roles and professional background, along with a corporate hierarchy.
• Operations Plan: Your company’s operational plan includes procurement, office location, key assets and equipment, and other logistical details.
• Financial Plan: Three years of financial planning, including startup costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
• Appendix: Include any additional financial or business-related documents.

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

Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

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

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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 are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to embroidery. 

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.

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Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your embroidery 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 needs 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.

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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 ZenBusiness’s 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.

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.

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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 are completing them correctly.

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.
• Venture capital: Offer potential investors an ownership stake in exchange for funds, keeping in mind that you would be sacrificing some control over your business.
• 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.

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

Apply for Licenses/Permits

Starting an embroidery 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. 

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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.

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.

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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.

Open a Business Bank Account

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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 embroidery 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. 

Get Business Insurance

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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 any of the above insurance types.

Prepare to Launch

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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.

If you want to be competitive, you’ll probably need good embroidery design software such as Hatch Embroidery, Stitch Era, and EmbroideryStudio to create designs from scratch or by scanning images.

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.

Marketing

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Some of your business will come from the casual passerby or online visitors, but still, you should invest in digital marketing! Getting the word out is especially important for new businesses, as it’ll boost customer and brand awareness. 

Once your website is up and running, make sure you link to your social media accounts and vice versa. Social media is a particularly good way of promoting your business because you can create engaging posts that advertise your products: 

• Facebook: Great platform for paid advertising, allows you to target specific demographics, like men under age 50 in the Cleveland area. 
• Instagram: Same benefits as Facebook but with different target audiences.
• Website: SEO will help your website appear closer to the top in relevant search results, a crucial element for increasing sales. Make sure that you optimize calls to action on your website. Experiment with text, color, size, and position of calls to action such as “Buy Now.” This can sharply increase purchases.
• Google and Yelp: For businesses that rely on local clientele, getting listed on Yelp and Google My Business can be crucial to generating awareness and customers.

Kickstart Marketing

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Take advantage of your website, social media presence and real-life activities to increase awareness of your offerings and build your brand. Some suggestions include: 

• Competitions and giveaways – Generate interest by offering prizes for customers who complete a certain action, such as the first corporate client each month gets half off. 
• Signage – Put up eye-catching signage at your store and website. 
• Flyering – Distribute flyers in your neighborhood and at industry events. 
• In-Person Sales – Offer your products/services at local markets and trade shows.
• Post a video – Post a video about your embroidery business. Use humor and maybe it will go viral!
• Start a blog – Start a blog and post regularly. Change up your content and share on multiple sites.
• Seek out referrals – Offer incentives to generate customer referrals to new clients.
• Paid ads on social media – Choose sites that will reach your target market and do targeted ads.
• Create infographics – Post infographics and include them in your content.

Develop your website

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

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.

 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 embroidery 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. 

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

• Best embroidery skills in town! 
• Wildest, most creative designs
• Digital embroidery creations for businesses large and small 

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 an embroidery business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in embroidery for years and can offer invaluable insight and industry connections. 

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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 embroidery. You’ll probably generate new customers or find companies with which you could establish a partnership. Online businesses might also consider affiliate marketing as a way to build relationships with potential partners and boost business.

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 an embroidery business would include:

• Embroiderer: Your embroiderer is at the heart of your operations, that’s why this person must be qualified and experienced enough to handle large, multiple assignments.
• Digital content creator: Building a strong digital footprint takes continuous effort and requires a well-thought-out content strategy that a digital content creator can help you with.
• Sales executive: A sales executive will be focused on closing sales online or through face-to-face encounters with prospective customers in the shop to boost revenue.
• Operations assistant: Your operations assistant will be on top of all operational, clerical, procurement, and administrative tasks so you can better focus on running the business.

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. 

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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.

Start Making Money!

Now that you have an in-depth understanding of the embroidery market, it’s time to roll up your sleeves and put your plans into action. The hardest part will be the first 100 days of business development, when you’re still trying to find clients. 

But you can make this work if you put in a lot of hard work and use the marketing strategies we’ve outlined above. You can also do affiliate marketing, where you compensate third parties in order to generate traffic to your website. You can develop long-term relationships with these affiliates and generate traffic for each other.

You’re now ready to start embroidering and making good money!