Many people start a freelancing career, but few succeed. Do you ever wonder why?
If you ask a freelancer to list the biggest obstacles that they face, then you’ll get a lot of different answers. Some will say “lack of confidence”, others will list “ stiff competition for jobs”, or “gaps between projects” as their biggest challenges.
While there’s some merit to all of those answers, I’m convinced that the biggest obstacle that most freelancers face is the lack of a business mindset. As a freelancer you might not realize it, but you are running a business. This is true even if you freelance part-time. It’s important to understand what running a business really means.
Here are six tips to help you get (and keep) a business mindset towards your freelancing career:
Tip # 1: Your Time Is Your Real Product
Most freelancers are selling a service, which roughly translates to selling your time.
(This is true even if you don’t accept work on an hourly basis. After all, even lump sum projects require that you use your time to complete them.) It doesn’t matter what service you actually provide, if you freelance, then you are in the business of selling your time.
The trouble with selling time is that everyone has a finite amount of time. Yes, you may be able to squeeze a little more productivity from your day through better time management (that’s why the Internet is filled with posts about how to manage your time), but in the end everyone is limited to the same twenty-four hours a day.
Because your time is limited, how you spend it is vitally important to your success. Once you understand that your time is your product, then you can begin to understand that how you use your time determines whether or not you will succeed or fail.
Tip 2: You Must Plan Your Time To Get The Highest Return From It
Freelancers like to be free.
At least that’s what many of them will tell you. “I’m freelancing because I didn’t like the structure of corporate environment.” Maybe that’s so, but as a freelancer you will need to learn to create your own structure if you want your business is to succeed.
There’s a direct correlation between wasted time and loss of income. As you engage in any business activity you should be asking yourself, “What are the benefits to this activity? Does the amount of time that I will spend on this activity outweigh the returns to my business?”
If an activity is time-consuming and provides very little return to the business, then you should either drop it, or realize that you are doing it for personal and not professional reasons.
Tip 3: You Must Plan For Your Freelance Business To Succeed
While accidental success is not completely unheard of, accidental success is so rare that you should operate on the assumption that it will not happen to you.
That means that you’ll need to devise a plan for your freelance business success. No, it doesn’t necessarily need to be a formal document. However, you should have some idea of your business’s goals and direction. You should have a strategy to get there. You should have a plan for your business finances.
It helps to have it all in writing. It still amazes me how few freelancers actually engage in business planning. Do you?
Tip 4: Getting The Message Out
Your freelance business has a message. Your message is what distinguishes your business from all of the other freelancers out there who offer the same services.
The problem is: if you don’t get the message out, then no one else will.
Many freelancers stop short of promoting their business and it costs them. Most of us were taught not to boast as children, but there’s a difference between boasting and marketing. Boasting is often full of empty promises. With good marketing you are just throwing the spotlight onto the truth about what you already know that you do well.
A freelancer with a business mindset won’t be afraid to market their services.
Tip 5: Managing Your Money
The failure to manage money well is the causes many businesses to fail, and the problem is not just limited to freelancers.
Here are a few money management tips for freelancers:
Have savings. A freelancer’s income varies from month to month. You don’t want the first business slowdown to throw you into a tailspin, so you should keep and maintain a healthy a savings account to see you through the lean times.
Track transactions. Keep accurate accounting records. Not only should you accurately record all income that you receive, you should also record any money that you spend on your business.
Remember the taxes. If you’ve come from a corporate environment where taxes were automatically withheld from your paycheck, then you may have a shock coming at tax time. Freelancers who live in the United States will owe not only their regular tax payment, but will also be liable for an additional percentage of self-employment tax.
Tip 6: Get Help
If you need help with any aspect of running your business, don’t hesitate to ask for it. One of the biggest mistakes that a freelancer can make is to try to do too much on their own. There are professionals available to help you with every aspect of your freelance business if you will let them.
- Do you have questions about marketing your business? Ask a marketing professional.
- Do you have questions about bookkeeping? Ask an accountant.
- Do you have questions about . . . Well, you get the picture.
Yes, sometimes getting help will cost you money initially, but often the cost of not getting help when you really need it is even greater.
When it comes to your freelancing, do you have a business mindset?
About the author: Laura Spencer is a freelance writer from North Central Texas with over 18 years of professional business writing experience. If you liked this post, then you may also enjoy Laura’s blog about her freelance writing experiences, WritingThoughts.