December 2, 2008

Lessons for Freelancers

by Brian Turner

Steven Snell writes an interesting post at Design Mag providing 16 tips for freelancers.

While we’ve seen these sorts of lists before, this is a nice collection in terms of range and depth, and raises pointers that really need underlining, especially in today’s climate of economic uncertainty.

I’ll provide a brief over view of the points below:

1. Not All Expenses Are Bad

Investing in good tools is a good idea, and investing in free but more limited tools is not a good idea. As I’ve stated often before, it’s not price that most important as much as the return. You need to invest in what you need.

2. Referrals Are Golden

Referrals are a potentially good source of clients, so if you can get them, then that’s great. A particular advantage with referrals is that your client has often pre-sold not just you but the service you are getting. Unfortunately, I’ve also found these hard to get, as many of my clients tend to be on friendliest terms with their competitors, rather than unrelated companies. Also be aware of the value of customers.

3. Weed Out the Tire Kickers

Steven makes the big point here of selling on quality, not price, another issues I’ve covered here a few times. Ultimately there are two general groups potential clients will fall into: those who will pay for a good job done; and those who want something cheap or free. Discern the leads quickly and politely decline the latter.

4. Charge Up Front

I think many internet businesses have been burned by this issue, such as trying to please a difficult client because you think you need the job, only to find they won’t commit; or else because you and the client are friendly so it doesn’t seem important to charge now. In all instances, a business will expect to pay, so charge from the beginning – it’s not an insult, it’s a proper business process reasonable clients will expect.

5. Accurate Record Keeping is Critical

Oh, boy – I’ve covered this before. Whatever you do, never let admin work build up, because once you lose track on this, it can cost you in time and money to fix.

7. Plan Ahead for Down Times

It’s always a good idea to work out a long-term strategy, and Steven mentions using slow time for networking and raising your profile. It’s a good idea, but I’d also add to look to diverse your revenue streams. Whatever your main source of income, a few extra sources can really pay off when needed. Additionally, I’d also recommend fore-saking big dividend payments and instead reinvest business income into growing your range of services, and leave other money aside for future projects as required.

8. Emphasize Time Management

Again, another important pointer I’ve covered before – set lists, targets, and goals – ensure you meet them on a monthly, weekly, and daily basis. One thing I like about clients is that they force you into this mindset, but you need to be able to work in a disciplined manner without them. Remember that working too long hours causes stress and even injury.

9. Taking Every Job is Not a Good Decision

Heh, many clients are great to work with, but some are a nightmare. The latter will often cost more than their worth. Additionally, I’ve personally found that it is important to recognise your limits and work well within these, rather than try to offer services you know inside you don’t have the time or experience to be competent with. A small number of happy clients is a stronger business foundation than a larger number of dis-satisfied clients. You don’t want to fail your business.

10. Repeat Clients Are Priceless

A good source of referrals for one-off payment industries, but if you can organise your business around a subscription model then the business security is amazing. TIP: Even in design, consider offering to charge a small retainer so that the client can contact you for advice and small practical help issues.

11. Networking is Critical

It’s the old saying – “It’s not what you know, it’s who you know”, and Steven underlines this.

12. A Comfortable Working Environment is Essential

Steven makes a point of separating business and domestic work space, and he’s absolutely right. I’ve visited other people who talk about setting up a home business, and those I see dedicate a room for it I know have a much better chance of succeeding than those who just have a PC in the bedroom.

13. Getting Profession Tax Advice is a Good Idea

Abso-bloody-lutely. Get a good accountant from day 1.

14. Leverage is Key to Long-Term Success

Steven covers both outsourcing and revenue diversification here – both of which often prove essential for long term strategy. If you see opportunity, even outside of your normal work direction, and the costs are affordable, consider taking it. Be aware of the importance of planning.

15. Standardize Your Processes

According to Steven, business efficiency means finding ways to standardize the process more easily. Those in more variable business models may find it harder to standardise, and as with many things computer there are often many different ways to solve the same problem. Whatever your method, though, try and keep efficient in order to succeed in business.

16. Pricing is Difficult and Not an Exact Science

Steven mentions about difficulties pricing – and boy, have I had issues with that. From experience, it’s worth considering offering different levels and pricing for a single project so the client can determine which option fits best within their budget range. I often ask about budget range and offer suggestions within and slightly above that anyway. Clients usually take the middle option, and some upgrade to the bigger option later on.

Either way, never be afraid on pricing, because if you focus too much on charging too low, you are devaluing your service and experience you can bring to a project. Conversely, be aware of market rates and look to work within them, as clients will often expect pricing in this region – too high above or even too cheap and that can set off warning bells. Also remember the importance of pricing strategy.

Discuss this in the Internet Business forums

Story link: Lessons for Freelancers

 

Posted in: Business