Year one as a freelancer is no walk in the park. Building a client base, marketing yourself, and finding time to work, rest, and play is a journey that will go smoother for some than others. But if you have been bitten by the entrepreneurial bug, there will be no stopping you no matter what happens along the way.
Let’s take a closer look at some freelancing tips to help your business survive year one.
Track all expenses and receipts
You cannot hope to run a successful business if you do not track your expenses (see expense tracking software from FreshBooks for more details).
Your expenses are the holes in the bottom of your cup. If you have too many expenses, your cash flow will be less of a stream and more of a cash torrent, where revenue comes in and goes straight back out again.
Many startups make the same mistake of focusing on how much money comes in, without monitoring how and where the money leaves their business accounts. If you go to check the cupboards and find out they are bare despite refilling and refilling them, you know you have an issue on your hands. Expense tracking software can help you to resolve that issue and fix any leaks in your business accounts.
Don’t forget your overheads
Freelancers want to please everybody. Superb work at rock bottom prices is a mainstay of what it means to offer services as a private contractor. But there’s only one problem. Where you bill your clients for your work and only for your work, you may actually be spreading yourself too thinly (financially speaking). Here’s why.
Let’s say you take a bus or a train into town to meet a client. You have a working lunch, where you buy a sandwich and a coffee. Later, having agreed on the fee for your work, you share your business card with the client and you go on your way.
If the cost of the ride into town, the lunch, and the business card was anything above FREE, you need to factor in such expenses in your overall rate. Slightly raising your hourly fee can help you to cover expenses. Bear that in mind the next time you agree to six or seven different trips over a few days to meet various clients – it all adds up.
Stay on top of software and technology
As a freelancer, you will likely benefit from some sort of online presence. You may also rely heavily upon software and subscriptions to complete your work (and it would go without saying that you would also need access to technology – e.g., a laptop or tablet).
The important thing to remember – especially for newly fledged freelancers who have come from a background of employment – is that you are on your own now. If you need hardware and software (and subscriptions), make sure you have the money to pay for these things before you charge the kind of rock bottom prices that financially rule you out of staying technologically prepared.
