Freelancing Problems–What Can Go Wrong?

What can go wrong with freelancing? The answer is that quite a lot can go wrong.

Recently, a family member confessed to me that he was freelancing on a part-time basis in addition to his regular job.

However, it was now over a month since he completed the work and he had not yet received payment. What’s worse is that the client was talking about paying him half of what they originally agreed upon. To cap everything off, the work was done for a friend (as a subcontractor) and my family member is reluctant to press the issue because of the friendship.

Of course, I was really sad that my relative had so many problems with his freelancing. But the more I thought about it, the more convinced I became that many of his problems could have been avoided if he had taken some precautionary measures.

In this post, I’ll take a look at each (very common) problem he experienced and discuss some things that he could have done differently. Since I know that a lot of freelancers make these very same mistakes, you may be able to avoid the very freelancing problems my family member now faces.

Working as a Subcontractor

The first area to examine is the fact that the project was done as a subcontractor. Now, in and of itself, there’s nothing wrong with working as a subcontractor.

For those of you who might not be aware, subcontracting means that you are taking over all or part of a project for an entity other than the end client. That entity could be another freelancer, an agency, or even a corporation. The bottom line is that you’re not working directly for the end client.

There are some pitfalls to subcontracting that all freelancers should be aware of:

  • Miscommunication is common. The information communicated to you may not represent what the end client actually wants. When you are subcontracting, it’s not uncommon to receive information through the entity that hired you rather than from the end client. Since that information may or may not be accurate, if you are subcontractor it’s doubly important to ask lots of questions.
  • You need a contract. The intermediary’s contract with the end client probably doesn’t protect your interests. The end client may, or may not, even be aware of your existence. The truth is that you should get a separate agreement with the intermediary, who is legally your actual client. The agreement should cover all of the same points that would be contained in a contract between you an end client.

Now that we’ve discussed some of the pitfalls of working as a subcontractor, it’s time to look at how you should deal with changes to an agreement.

Dealing with Changes in the Agreement

Many freelancers struggle with what to do when the terms of a freelancing agreement change. Without a written agreement or contract, it can be very difficult to enforce your original terms. The last thing you want to do is get into a debate about what was actually agreed upon.

Still, it’s better to document in writing what you thought the terms were than to continue on with an oral agreement. Sometimes this can be enough to resolve the matter.

In the case of my family member, I would recommend that he send an email listing what he thought the original agreement was. That email should be as specific as possible, listing the date the original conversation occurred as well as the specific tasks that he agreed to perform.

Future conversations concerning the work should also be documented.

Of course, if a written agreement or contract is in place, it’s much easier to identify negotiate changes. Ordinarily, when pay is reduced there should be a corresponding reduction in tasks performed.

Another problem freelancers face is understanding how to deal with friends or family members.

Dealing with Friends and Family Members

Another problem my family member faced was that he did business with a friend. Sometimes, but not always, this can spell trouble.

The important thing to remember when working with a friend or family member is that you are still running a business. Unless you intend to provide your services for free, take all the precautions that you would take with any other client. This includes getting a contract from them and getting a percentage of the project upfront. Then, perform your tasks with the same care and service level that you would be provide to anyone else.

Some relationships just aren’t cut out for working together. Here are some warning signs:

  • The person is a lot of fun to be with, but not very responsible.
  • The person has lied to you before about something important.
  • The person is very inexperienced at what they are trying to do.

You may feel like you need to say “yes” to preserve your relationship, when really the best way to preserve it is to say “no.” Don’t be afraid to say “no.”

Dealing with Late Payments

The last problem my relative faced was that the payment for his freelancing work was late.

Late payments are a huge issue for freelancers. For most freelancers, this is how we earn our living. So, receiving a payment late may mean that we can’t pay some of our bills on time.

Of course, a contract makes collecting payments easier. But even if there is no contract, it’s important to send out invoices promptly and follow up when an expected payment is late.

Be firm and professional about collecting the payment, but not accusatory or emotional. If your repeated requests for payment are being ignored, you may need to get professional help collecting what you are owed. But that should be a last resort.

Your Turn

Not everyone will face these exact problems when they freelance, but nearly everyone eventually faces some freelancing problems.

What freelancing problems have you faced? How did you solve them?

Share your answers in the comments.

Image by InspireFate Photography

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Comments

  1. WilliamH says

    90% of my business is subcontracting. The most notable issue I face is timing. Communication relays tend to always create a noticeable lag within projects. End client asks contractor who asks me… I answer contractor who answers end client… It’s a tedious loop of slow delivery in a world where the end client expects instant.

  2. says

    I don’t do subcontracted work, but the only problem I’ve had so far has been with one particular client (not anyone I knew prior to working with him). He was very demanding from the start (He tried to demand that I work for half my rate because he thought himself so important and influential! His nerve was laughable.) and I had a bad feeling about working with him because of the way he was treating me. I should have heeded that intuitive warning. He never paid me, and I ended up putting hours of work into his project. He got a freebie. Now I listen to my instincts more, and make sure all projects are fully paid in advance before I start work on them. I definitely learned my lesson!

  3. says

    I prefer to receive a 50% down-payment and a signed contract before I begin a project. I have had an experience were a client paid the initial deposit but did not pay me once the project was done. This was even stated in the contract. I still have yet to receive money from the project. As a result, I revised my contract and made some changes based off of this experience.

    I must be honest, its a little ackward to address the issue because you don’t want to seem like your all about the money. However, business is business.

    I have done a little work with a family member, but it was pro bono work. I prefer not to work with family. I have learned that they expect to receive a discount because we are related. LOL!

    For the most part, my friends understand that I have a business and approach me in a professional.

    I do hope things work out for your friend.

  4. says

    Brandon Halliburton

    I haven’t followed up to see if he ever got payment. I definitely agree with you about getting an initial payment, though. This is especially true if it is a new client.

  5. says

    Brandon: I get a 50% deposit, too, for projects. I don’t if it’s for ongoing retainer work. And I do that only with people who have proven to be trustworthy.

    I will be signing a couple more retainer agreements next month. Due to experience with a previous client, I am now invoicing them as “payment due upon receipt” instead of in 30 days. The previous client waited 60 and sometimes 90 days to pay, even though I was working 40-60 hours a month for him and was considered part of the staff. If he could budget and pay for payroll each month, why couldn’t he budget my pay (which didn’t change) as well?

    If someone balks at signing a written agreement, point out that it also protects THEM, not just you. It lets them know what work is to be done, and gives them something to fall back on.

  6. says

    Yeah, the hardest thing about freelancing is juggling all the different hats you need to wear and to do them well as if any of them are faulting, you get burned and usually don’t have the time or resources to properly deal with it. I think some clients or friends realize this and take advantage of it, maybe without even realizing it they do it, just because they can.

    Agreed with all the suggestions, any way to set the expectations upfront should be a big help to reset their behavior, sort of force them to act the professional from the start but that’s not easy when starting out, still learning how to properly wear all these hats, ie creating things/doing the actual work, research, marketing, sales, customer support, finance, a hundred others as well as collection agency, fun, fun, fun, :).

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