Freelance Tips: 15 Essential Things Every Freelancer Should Know
Thinking of going freelance with your career? Then check out these 15 crucial freelance tips to give your self-employed venture the best chance for success.
June 4th, 2010 by Becky Turner
Freelance Tip #2: Make Use of
Freelance Project Websites |
Going freelance is a risky business. How will you find new work? Will you earn enough to pay your bills? What if a client doesn't pay you?
As a freelancer, your new job is to sell your services to clients, do the work, and collect the money. You are now a salesman, an accountant, a customer services rep, and an entrepreneur all at once. You are an all-singing, all-dancing one-man show.
Of course, the upside is that you have complete freedom to choose your own projects and set your own salary. As a freelancer your earnings are uncapped. You also get to work in your ideal conditions, with no boss or line manager breathing down your neck, and no office politics to contend with.
So while working for yourself comes with greater responsibility, it also comes with greater freedom. This is definitely my experience as a freelance writer. The following freelance tips explain the critical elements of running a successful solo career from my perspective. You can apply most (if not all) of these tips to your own situation, whether you are a freelance IT programmer, graphic artist, carpenter, counselor or otherwise.
Freelance Tip #1 - Create a Portfolio
Any potential client wants to see a demonstration of your skills before they give you the green light. So create a portfolio of your very best work - preferably digital, so you can put it in front of a new client straight away.
I used to send prospective web clients to my Suite 101 profile, which houses a number of SEO articles on diverse topics. Later, I directed clients to my own content-based websites. But it's important that the portfolio matches the tone of the job in hand, so for corporate clients I used to email a PDF of my best business related articles.
If you're a dog groomer, collect before and after photos. If you're a counselor, collect testimonials (anonymous, no doubt). Whatever your skill, figure out the best way to show people your great results.
Having a portfolio on hand shows you are a professional and saves you a lot of time messing around looking for work samples at each request. If you seek business clients, create a targeted CV so you can apply for long term freelance contracts too. Companies are more likely to want a CV and your professional background before they hire you to overhaul their website.
Freelance Tip #2 - Make Use of Freelance Job Sites
Look up online job boards like Guru or Elance for thousands of listings in the IT and media arenas - writing, website design, web development, IT programming and related niches. You can also research specific freelance listings and forums by searching Google for "freelance jobs + your skill."
The advantage of a freelance website is it connects you with so many potential clients in one hit. The project boards contain myriad listings which the freelance community may bid for. Once the preferred bidder is chosen, the website holds the payment in escrow (taking their commission, of course) until the work is complete. Feedback can then be placed.
But there is a downside to this system. You can spend a lot of time writing the perfect proposal but will likely be up against a dozen other freelancers. I used to spend hours surfing job boards, and only very few of them came good. Frustratingly, with such a busy marketplace, you can easily be outbid by the competition. And because these sites are accessible by freelancers all over the world, your hourly rate of US $40 can be blown out the water by someone in a developing country, who may work for much less.
I still recommend websites like Guru because I have found new clients with them, but don't debase yourself doing $1 jobs just to get work. Be selective about what you bid on, match your rate to the client's budget, and create yourself a really impressive profile so the clients come to you.
Freelance Tip #3 - Contact Agencies in Your Niche
My best source of repeat freelance work was from media agencies. This means you get to deal with professionals, rather than end clients who, like it or not, can sometimes be a pain in the ass.
How do you find a good agency? That's the tricky part. When I started freelancing, I sent out generic emails to about a hundred media agencies in the UK. I wrote a good cover letter telling them about my experience and attached a CV and writing sample. I never heard back from most of them. Many more told me they would keep me on file (blah, blah, blah - and of course never heard from them again).
However, one of them said the magic words ("YES! We are hiring!") and offered me a project as a test run. No interview required. I did the work, got paid, and the end client was delighted. I still do regular projects for this company, Freelance Copy UK, to this day even though I have stopped most other avenues of freelance work to focus on my own businesses. I do it because they give me a very decent variety of writing projects and are trustworthy when it comes to paying my invoices.
Clearly, writing to hundreds of agencies in your sector is a hassle but all it takes is for one to respond positively. Then it's up to you to give your very best and prove you're an asset worth keeping.
Freelance Tip #4 - Tell People About Your Services
If you're going freelance, chances are you currently provide your services to an employer, so you'll already have a network of contacts in place. Tell everyone that you're going freelance and leave them your contact details.
Warning: in many job contracts, it's a breach to "steal" clients from your former employer, so I'm not even hinting at doing that (they could sue you and come after all your earnings and then some). However, lots of your contacts will go on to have other jobs, and even start up companies themselves, so if you had a good relationship they'll think of you first.
Tell all your colleagues too. After leaving London, we were contacted by three separate former colleagues to do website design and writing for their new businesses, generating tens of thousands of dollars.
So don't be shy about your freelance work. Tell all your friends and family. Let them know exactly what you can offer. Don't just say "I'm a freelance web designer now." Explain to offline business owners that a website can generate hundreds or thousands of new customers for them, and you can make that happen. It's probably an alien concept to own a website, something they never even considered for their business. So it pays for you to take the initiative and really get them thinking about the benefits for them, rather than sound like you're just seeking your next job.
Freelance Tip #5 - Create Your Own Website
Speaking of which, if you're serious about your freelance career, you need your own website too. A good website will land targeted traffic (people who are already searching Google for your services) and warm them up so by the time they pick up the phone to call you, they are raring to go.
Your site should include these features as a minimum:
- About You - What is your background and what qualifies you to be a professional writer / artist / web developer?
- Case Studies - Show us examples of happy clients and what you did for them. What makes you different from everyone else?
- Services - Exactly what services do you provide? Outline as many projects as you can think of, so you're not limited by the client's imagination. Explain the benefits of new concepts.
- Contact - Provide your full contact details including email, telephone, cell, fax, physical address and registered address.
If you're an artist, you should feature a gallery of your best work. If you're an IT contractor, focus on your cutting edge skill set and client testimonials. Present the very best of your results. This is your chance to make a big impression and win the client over. Best of all, once you set up your website, you can generate new leads, day after day, without lifting a finger. Your website is your automated salesman - and he works for free!
There are many ways to create your freelance website. Here are two of the most popular and simple site building tools I know:
WordPress
WordPress is a user-friendly platform for building your website. The first thing you need to do is sign up for a domain (unique web address) and hosting (email and data storage) with BlueHost. This is the recommended host on WordPress and delivers reliable customer service and hosting for just $6.95/month. The domain comes free.
Next, download the free site-building software at WordPress. From there you can create your website by choosing from ready-made design themes and writing all your content in simple preview mode. They offer simple tutorials so anyone even slightly tech-minded can pick it up. If you don't like the generic themes and want something uniquely yours, Pete offers discounted website designs which are compatible with WordPress.
Alternatively, if you have no budget for a website, you can create a free WordPress blog as a basic launch pad. However, these are ten-a-penny, less flexible to worth with, and look less professional because you only have a WordPress subdomain. For $7 a month you can have the full monty, and it's totally worth it for your freelance business.
Site Build It
Site Build It is another very user-friendly platform which is focused on helping you building a profitable online business. For many people, it is a better option than WordPress because it is not just a technology; it is an education. You will learn, over the course of a 10-step video guide, how to make a profitable website based on a content-focused niche or on your own business - in this case, freelancing your services.
For instance, SBI explains how to research the best keywords for Search Engine Optimization (SEO) which is how people find your website on Google. Without traffic, your website may as well not exist. It also teaches you how to "pre-sell" your reader - in other words, how to warm them up to your product or service without any obvious or hard selling techniques.
I used Site Build It to make my first website and it is the best thing I could have done for my career. The hosting is a little more pricey at $25/month (the domain comes free) and that's because you're paying for a complete package - simplified tools, design templates, lessons in marketing, writing for the web, getting free traffic from Google and more - all of which will make your site go a lot further. To learn more, read my Site Build It review.
Freelance Tip #6 - Exceed Your Clients' Expectations
Being a perfectionist in life has its pros and cons. But when it comes to making your freelance clients happy, perfectionism is definitely a pro.
When you take on a project, your client has certain expectations in mind. They are paying you good money to produce good results. If you fall short of their expectations, not only will you lose the client, but they will never recommend you to anyone else. And this is how your business will likely grow the fastest - through happy clients and word of mouth.
So while it may seem obvious to some, and completely redundant to others, the fact is your business will grow faster if you always deliver first-class results. Freelancing isn't just about getting cash into your bank account, it's about building a brand and a reputation for a more reliable income in future. Be the best that you can - otherwise, what's the point?
Freelance Tip #7 - Never Miss a Deadline
Did you know that it is never OK to miss a deadline as a freelancer? It's unprofessional, and it tells the client that you are not prepared to do what it takes to fulfil their needs.
If the deadline is imposed at the last minute, then make it clear that you need extra time. But in most cases, you will have plenty of time to schedule the work properly, so there is no excuse for letting down the client. This is a cardinal rule. Never, never, never miss a deadline.
Freelance Tip #8 - Get a Complete Project Brief
Ignoring this rule has let me down a few times, and it's extremely disappointing when it happens. If the client gives you a vague brief, or if you make any assumptions without their input, you can end up producing something completely off-target. The result is doubly frustrating; you fail to meet the clients expectations AND you have to redo the work, costing you additional time and money.
Following this freelance tip is easy once you're fully aware of it. Just make sure you understand exactly what the client wants. If they sound vague or too generic, ask them precisely what have in their head. Or give them options as you see it, and ask them to clarify anything that doesn't make sense. Take the time to understand what your client wants, or risk having to do the work twice over as a result of getting it wrong.
Freelance Tip #9 - Determine Your Minimum Rate
This is always a hot topic among new freelancers: exactly how much should you charge? First of all, don't work out your hourly rate from your last office job and apply that to freelance work. As a freelancer you have to consider two things:
- Freelance rates are often higher than employed earnings because you are taking on all the risk and running your own enterprise. You are highly unlikely to have continuous freelance work every hour of every working day (especially during your first year). But, you do have extensive professional knowledge and when a client pays for your time, they're going to get real value out of it. A freelancer is a serious professional - not just a guy without a boss.
- You are no longer limited by what your boss dictates, so why impose the same limitations on your salary? Just because your boss refused to give you a decent pay raise for the last three years, it doesn't mean freelance clients wont pay you good money for your efforts. So don't undersell yourself as a self-employed person.
The best way to actually determine your pay rate is to look at the marketplace and what other people are charging. You'll find this varies considerably so pitch yourself somewhere in the middle and at a rate you are happy to work at. If you pitch too low, you'll rush through jobs and resent any client who asks you to spend longer on them. Pitch too high, and you'll either price yourself out of the market or your clients will have whopping great expectations for the money you want.
I know you want to hear figures so here are my hourly rates for freelance writing (converted to their US dollar equivalents):
- Basic Copywriting = $30-40 per hour
- SEO Writing / Feature Articles = $40-70 per hour
- Investment Research = $100-200 per hour
I quoted each project individually because sometimes I would have to do a lot of intensive research; other times I could just write the whole piece from the top of my head. Writing investment research is a highly specialized area which few people can offer. The more specialized your niche, the more you dominate your market, and the more you can charge. You can also increase your rates as you gain experience and get better at it.
The thing to remember is this: you are not putting a price on your time, but rather how much the market values the service you're providing. It may seem strange that I could charge one client $200 for an hour's work, while another pays only $30. But I can assure you the first hour was a lot more challenging, while the second was a walk in the park. Having the variety is good - it keeps me interested. It also gives me the entrepreneurial mind set that my time could be worth anything; $500, $1,000, $5,000... why stop there? Maybe not as a copywriter but when you're dealing with passive income, as I do now running content websites, you can literally earn thousands of passive income dollars from a single hour's work.
Freelance Tip #10 - Send an Invoice on Completion
As soon as you complete the work, send the invoice. This is the first of three important freelance tips for collecting your payment on time.
Staying on top of your invoicing ensures that the payments don't stack up (in which you assume of the 100% risk if the client defaults) and keeps your own cash flow healthy. I recommend you state on the invoice that payment is required within 7 days. Your client may have a policy of paying all invoices on a set day so you can be flexible, but make sure you have some kind of deadline agreed so you know when to start chasing.
Freelance Tip #11 - Get Partial Payment Up-Front
When you deliver a service and the client refuses to pay, it's extremely frustrating. You go out of your way to provide an excellent service and they thank you by dodging payment. They may as well spit in your face.
In my experience, clients don't pay because:
- They forget - which is usually not a problem because you can simply remind them and everything is tickety boo.
- You didn't meet the brief - in which case you usually have the chance to redo the work and smooth things over.
- They are going bankrupt - in which case you must call the debt collectors in ASAP or risk losing the entire invoice.
- They have no conscience - in which they string you along for months or sever contact altogether, and the end result is zilch.
In order to avoid this risk, I recommend negotiating a deposit with first-time clients and, for that matter, any client at risk of dodging payment. You would be surprised how often it happens - even so-called friends can do a runner on you (after they find a way to justify it to themselves).
Both Pete and I learned this lesson the hard way by invoicing 100% of all client payments upon delivery of the work. Some people are just noncommittal, giving us a brief but when it comes to delivery, they say they don't want it anymore. Others will happily take our hard work and apply it to their business and somehow convince themselves they don't owe us anything for it. As a result we have accumulated thousands of dollars in "bad debts" (monies which are not paid) - some of which are still not paid even after a court order. It's amazing how far some people will go.
So if a new client refuses to pay anything up front, even a token deposit, ask yourself why that might be - and if you really need the hassle.
Freelance Tip #12 - Always Chase Delayed Payments
Most people are quite embarrassed if you have to ask twice for payment (they're the ones with a conscience). Plus, they might really like your work and want to maintain a good business relationship with you.
If the invoice deadline passes without payment, then alarm bells should be ringing straight away. Phone or email the client and ask for an explanation. Sometimes the answer might be innocent - it's easy to make admin errors, or maybe their accountant is off sick. If so, arrange to have the monies paid within the next 24-48 hours and everyone can relax. If you are still being fobbed off for a week or more, it's time to put the pressure on.
First, send a formal letter in the mail outlining the debt and what rate of interest you charge on delayed payments. Be polite and don't make any threats, but do impose a new deadline and send a copy of the original invoice. Follow this up with a phone call to the person in charge of their accounts. Again, be firm but polite. Tell them you will contact them every day to see how the payment is coming along. Don't let up.
Stick with this tactic for another week or so, and don't accept any promises of distant deadlines ("I can pay you when our funding comes through in six weeks"). That is not acceptable - they should never have contracted your services if they had no means of paying you.
If they are still giving excuses (an excuse is any behavior that doesn't result in them paying) then it's time to call in the debt collectors. I suggest Googling a local agency in your area and comparing their success and commission rates with others. We're currently working with a debt collector in the UK who takes 15% which I think is quite reasonable. I know of other agencies who take 40% or more.
After that, the agency will take over chasing the debt on your behalf. If successful, this is definitely worth saving you any further stress or wasting your time chasing the client. The debt collector should investigate the client's assets; chase the debt with phone calls, letters and personal visits; initiate court or litigation proceedings; arrange bailiff services; and more. Their only fee should be a percentage of the debt collected - so you are certainly no worse off than you were before.
Take it from me, don't allow clients (even friendly ones) to go for weeks or months without paying - or you could end up feeling very stressed and losing thousands of dollars. And that is a very hard pill to swallow. Remember the longer you let the debt slip by, the harder it is to recover, so always chase delayed payments straight away.
Freelance Tip #13 - Avoid Mates Rates
Whenever you offer an in-demand trade, friends and acquaintances will inevitably hire you. Let's say you're a plumber and your friend wants you to install his new bathroom. The automatic assumption is that you will do him "mates rates" - because you wouldn't want to rip him off, would you?
This assumption is sadly flawed. For a start, you are offering real value - none of your regular clients are "ripped off" by your prices. You are charging a fair price for a fair service. So by charging your friend the bare minimum for the cost of materials, your friend is the one ripping you off.
That isn't selfish; that's basic economics. It's one thing to do your best friend or your brother a favor. But when you start awarding every casual friend and acquaintance with free labor, you are devaluing your skills and your time - and costing yourself a lot of money.
It's easy to fall into this trap when you don't draw the line. A friend of mine is a joiner and has put up with this problem for years; making beds and tables and front doors for free. He's the kind of guy who gets on with anyone - so he has a wide circle of friends and acquaintances, all of whom are looking for mates rates. He's spent countless weekends working for other people for free, which adds up to many thousands of dollars.
So while you wont charge your mum for your time (she earned it!) don't extend that rule to every bugger you know. If you do this, your work will never be done, and your bank balance always lacking.
Freelance Tip #14 - Set Aside Earnings for End-of-Year Tax Repayments
TAX! There's a scary word for newbie freelancers. How much do I have to pay? When do I pay it? How do I organize my accounts? Do I need an accountant? What the heck does tax deductable mean? Where am I?! What year is it?? Who's the President???
Calm... and relax. Tax is quite scary when you don't know what you're doing - but the good news is, all you need is a nice friendly accountant who can explain the rules for your specific situation.
I wont pretend I know anything about the US tax system. But here is a summary of my tax keeping activities in New Zealand:
- #1 Hire an accountant - and explain your business to them. A local one is better, so you can meet them face to face. They won't charge for a consulatation; only when they do the year-end work.
- #2 Record your expenses - and keep receipts, such as rent, power bills, internet, car repairs, computer parts, business subscriptions, petty cash, etc. The idea is you offset all your business expenses against your income, so that amount is effectively tax-free.
- #3 Record your income - including all invoices, product sales or affiliate income (or whatever your source of income). Keep records of the dates that invoices were sent out and all monies received.
At the end of the tax year (March 31st) I send all my records of income and expenses to my accountant for processing. It helps that I send my bank and credit card statements too. He then does the maths and tells me what I owe the Inland Revenue Department (IRD). I have up to one year to do this, but the sooner it's done, the easier it is to trace everything.
In the first year the tax owed can be quite a whack, even after deducting your expenses and taking any personal allowance. You will need a small fortune tucked away because technically it doesn't really belong to you, it belongs to your friendly government. TING.
In Year Two of our freelance activities, the IRD began charging us Provisional Tax, which is a quarterly tax paid in advance based on last year's earnings. It makes the end-of-year hit much less painful.
In the US, I understand the taxes are even more complicated, with Federal and State Income Tax running between 30% and 55%. That's quite a range. Like I say, I don't pretend to understand US tax laws. Each country has it's own rules, so wherever you are, contact a local accountant as soon as you start freelancing and it will save you a lot of money in the long run. Don't wait until the year end to sort out your taxes, as you will almost certainly kick yourself for missing out on money-saving opportunities.
Freelance Tip #15 - Don't Give Up!
Going freelance can be a tough old gig. If you don't have the network in place to supply you with work immediately, you will find yourself taking the worst paid jobs just to have something to do. Or, worse, you wont even get that. At what point do you stop calling yourself a freelancer and start calling yourself unemployed?
But let's not get carried away in negative doom and gloom. Freelancing your services part time while you still have a "proper job" is an excellent back door to going self-employed full time. You may even end up hiring other contractors to share your workload... and then you have a business.
So even though there may be times when you're struggling to find new projects, if you have the stamina to ride it through, you'll likely come out the other end just fine. The hardest part is definitely the first year when you're still finding your feet. Work will be frustratingly sporadic. But just when you think it's all over, another freelance job springs out of nowhere.
So keep networking, keep contacting agencies and potential clients, and eventually you will find yourself in the right place at the right time. Be proactive at all costs. There are the key ingredients to a successful freelance career: skill, persistence, and a little bit of luck.
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