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The Ugly Truth About Freelancing
What you should know before starting your own business
As many people think, freelancing is a lifestyle, not just a dream job. First of all, you should be skilled in some areas to have something you can offer to your clients. There are many market regulations that you will face while freelancing. Keeping your knowledge of them up to date takes valuable time, which you can then exchange for money from the projects you work on.
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And also, maintaining your skills on a competitive level and improving them takes valuable time, which you will later exchange for better-paid contracts. This post will reveal some of the rules I made for myself in my freelance life. All of the mentioned rules have the same weight, but it depends on the area where you telecommute and whether it’s suitable for you.
All of the rules I will share with you have the same weight. There are, of course, some exceptions. For example, if your trade is home refurbishing, you must consider the distance to your clients and whether it still makes sense.
Choose projects/clients wisely.
How to choose projects or clients? Before this question, you can review my list with criteria which help determine whether I am interested.
People with whom I will work with
Flexible working hours: yes/no
Regular meetings/calls: yes/no and when
Manday rate/hourly rate: If I know this I directly know If we should continue in negotiation
Invoice due dates
Size of the team
Work report requirements
Do I need some special HW
100% Remote possibility
Is it new position or extension of existing team?
Competences and responsibilities
Is there any fixed time interval when I have to be available?
Is there someone for consulting — e. g. someone who knows where I can find the documentation for internal API, etc.?
Find a niche. Own it.
Why is finding a niche so beneficial? It’s easier when you are an expert in a specific area because then you are the one who determines the trends and prices. There is also a side benefit to obtaining this position — you are the one who can specify the project’s direction because your client relies on your knowledge. It gives you more control over the project.
Track your work hours
If you are a freelancer, there are multiple ways to approach it. Tracking working hours works best for me because I can report it against the hourly/ day rate. There are many tools for tracking time. I prefer to work with my notebook, keeping my notes from the day and then creating a report with days and hours for my client. The report contains a breakdown of what I did and when.
Learn the art of negotiation
This is one of the essential rules. The art of negotiation can and will improve your person-day rate, working hours (working less for more), benefits, and more. It all depends on how experienced a negotiator you are.
Many companies/ clients are used to people who can’t communicate properly, let alone negotiate. A typical example is software engineers, typical introverts with low social skills and/ or emotional intelligence (so-called EQ). Don’t be one of them and never accept any offer right away. Focus on the negotiation. You can always get a better deal.
You are in a worse bargaining position if you tell your salary expectations first. Let the client share their offer first and then work with that.
Don’t rely only on one source of income.
I have a straightforward rule — don’t do overtime regularly for any customer. Why? The answer is simple. When I think about the sustainability of my income, there is always one red flag: having only one income source. How long can you live from your reserve if you lose this income source?
When your business grows, you will discover many areas on which you should focus and realize that you can’t handle everything alone. You will find out your weaknesses and strengths. It’s more accessible and more valuable for you to focus on what you are good at and delegate more complex tasks to you.
If you don’t realize this, you can ensure your business will stop growing. Freelancing in the core is essentially running a business of one, but if you want to scale, you will need more than yourself.
Take a piece of paper, write down your weaknesses, and think about ways to delegate them or turn them into your strong points. In my case, it should be something like this:
I should work on my language skills → this is why I started writing a blog.
I need to improve my marketing → it’s more beneficial to delegate this.
I need more time to take on more projects → I can delegate some of the work and then take on more projects.
I should also focus on sales and lead generation → again. I can delegate this.
Don’t forget about customer service
Once you get your first contract, you must start caring for your customers. You must focus on the services you deliver to your customers. Providing just that is a sure way of securing long-term clients, which is the outcome you hope for. When you care for your customers, you show them that they aren’t just cash cows for you but instead that you value them while building mutual trust, and at the same time, you also increase your credibility.
Clients are really into submitting work on time. Satisfied clients can refer you to others by word of mouth, the best reference you can ever get, helping you earn more clients. These are just a few reasons you shouldn’t hesitate to provide a breathtaking customer experience. Customers can determine your customer service level through email communication and client interactions.
There’s nothing you can lose. You can only gain more. Take good care of your customers.
Always keep the client up to date. If you encounter issues, keep the client updated about the current status. Don’t forget about continuously updating them as you progress. Please share with the client possible solutions and discuss the best way to fulfil their requirements. Reply to your customers within 24 hours. If you still don’t have an answer, tell them you are working on it.
Freelancer != Solopreneur
No one will be excellent in everything. The intelligent thing to do is to find your strengths and focus on them while delegating your weaknesses. This is the right way how to freelance.
Think about digital minimalism → distraction as the productivity killer
If you’ve never heard of digital minimalism, a great book from Cal Newport can introduce this topic. Long story short, it’s about reducing distractions to the lowest possible level. I try to communicate in a written form that doesn’t require an immediate reply because then I can postpone it to a moment when I am not entirely focused on my work.
If a call is needed, you should include some time management where you tell your clients when you are less productive periods so that the rings won’t be that distracting. If you want to learn more about deep work, another excellent book from Cal Newport can help you.
The clients don’t want to accept your new pricing?
You can have the best possible relationship with your client, but when you have to increase your price, you can go over their budget, or it can be too expensive for them. It’s a normal part of a freelancer’s life. So don’t be sad new clients who can allow your services will come. Don’t be sad when a long-term client leaves you because of pricing. New clients will appear who can offer your services at your new prices.
Organizing your work life
By this, I mean that after lunch, you would instead take a nap than work, so feel free to use this time for calls, solve emails, or take rest. You can try to make one “full focus” day without any rings, for example, Friday, which shouldn’t be that hard because most employees can think only about the weekend on Friday. For someone else, it might be better to have free Mondays.
You have to find what’s your ideal schedule according to your nature. Everyone has different. It doesn’t matter whether you are a lark or an owl. Everything in a freelancer’s life is about the quality of provided services you deliver and the customer service. Just refuse every customer, which requires that you are available 9–5 unless that’s your ideal work schedule when you are the most productive (which, if that’s the case, you are one lucky bastard).
The contract is a must.
Don’t work on a project without a signed contract. The contract is a must since it provides meagre things like invoice due date, hourly rate, description of how to solve client complaints, and more. It’s a win-win situation for both sides. Clients have the assurance that you will commit to the work you promised, and you know that the client will compensate you for your services.
Don’t work under a fixed rate using an hourly rate instead.
Earning a fixed rate for a set period (e.g. a month) or per completed project is bullshit. Yes, you can win a ton, but you can also lose everything.
I think it’s fair to want an hourly rate because you will be rewarded every time.
Work only remotely, no commuting
I don’t take any contracts which require my presence at the customer’s site. The reason is simple. When I can work from wherever I want with flexible work hours, I can manage my time and spend more with my family, I can reliably work on my self-development, and, even better, I can work on more projects instead of focusing on just one.
Work on your skills to increase your income.
Simply put, the better services you provide, the better money you makeWork on improving your skill daily. Make it a daily routine. The world is full of possibilities for strengthening oneself, like certifications, courses, training, and everyone’s favourite — reading the documentation or simply experimenting.
Do small projects to improve your skills. Think of it this way. Putting just one hour into self-development daily is 365 hours per year, roughly two months of work time. With this, you will get two months ahead of your yearly competition. The more you put in, the more you get back.
Don’t be afraid to ask clients the questions you need to be answered to fulfil their needs.
I work as a freelance software engineer, and if I am to develop something for a client, I have to ask many questions because otherwise, I cannot precisely create what they expect. Remember that most people neglect to describe the issue they want solved quite vaguely because they think this is enough (based on their knowledge, experience, etc.).
Getting back on track
When you get stuck at some point, discuss it with your client. Maybe they will have someone or something which can help you get back on track. Don’t hesitate to ask for help when you need it. It saves your time and client money.
Multiple income streams
Never rely on just one income stream. Continually develop multiple of them. You can either aim for passive income or have some side hustles. It’s completely up to you. This will prepare you for worse times when it will be harder to find a new project. Having always some source of income puts your mind at ease.
Don’t hesitate to lower or raise your hourly rate when needed. For example, having a lower-paid contract during an economic crisis is better than nothing. Once demand is higher than supply, you can again raise your prices because you have only a limited amount of time to “sell”.
You can’t create more time (once fully optimized), but you can always get more for your time. Going to work or freelancing is nothing else than just exchanging your free time for someone else’s money.
Use password managers
Don’t hesitate to use password managers. I use Bitwarden. It’s easy to use and can be integrated into your browser, phone, PC, etc. Applications like these save you time daily, and as a benefit, it keeps your credentials safe.
Always ask for referrals
The last point that I prepared for today is about referrals. Maybe you think that some customer is not that important, but there are benefits to getting a referral from every single one of your clients. If you work under NDA or with confidential data, the referral is the only way to show that someone was satisfied with your services.