Freelancing and consulting can often seem like an impossible juggling act, but if you keep these seven practical business tips in mind, your business will go from strength to strength.
Work out what you’re best at and express it clearly on all marketing material – niche marketing is a simpler and more profitable way to grow your business, rather than trying to be everything for everyone. The more detailed your customer avatar is – the simpler it will be for you to find them, connect with them and offer something of value. To start creating your customer avatar think of the following questions:
- Who is my ideal customer? Who would I like to work with?
- Are they able to pay my fees? Will they be willing to pay my fees?
- What problem do they have in life, that my offering will help them solve?
- Why is it important to get it solved?
- How many of those customers are out there in the marketplace?
- WHERE… (do they work? Where do they study? Where do they live?)
- WHAT… (do they eat, drink, read, listen to, are interested in?)
- HOW… (do they look for new products or services, do they choose their suppliers, do they pay the bills?)
Talk to current and former clients to understand if they want the services you offer – there is no better way to find out if people want what you set out to deliver than actually asking them! Talk to your ex-colleagues, people you know in business, create a survey and email it to your contacts. At the end you will have a statistics to hand to show whether your business proposition is viable.
Keep marketing even when you’re snowed under with work – many solopreneurs go through the same business cycle of “no work – marketing – lots of work – no marketing – no work”. It may be hard to find time when you are already busy. But by carefully managing your time and finding a few chunks of 60-90min per week to do your marketing will help you smooth the flow of work and ensure that you don’t end up with too many of those “no work” periods. Many marketing strategies are designed for ongoing marketing based on building relationships. Such strategies work best when you regularly commit to doing something over and over again, regardless of the amount of time/work you have at the moment: Twitter, Facebook, LinkedIn, other social media, networking, blogging, etc.
Invoice promptly and chase for payment as soon as its due – if you have done your job well you should get paid for it. And being late with your invoice can show your business as unorganised. Plus it means you are giving your customers a free credit, instead of earning interest on their payment in your own bank account. If you are really late with your invoice – the customer may forget about the benefits of your product or service, may ask for changes or extra work before the invoice gets paid or simply go out of business in the current climate. Can you really afford to lose your income like that?
Keep careful records of expenses for tax purposes – trying to do a year’s worth of accounts actually at the end of the year is more expensive, more stressful and there is a deadline which you can’t miss. Much better way is to keep track of your income and expenses throughout the year and keep your book-keeping system up-to-date. Losing claimable business expenses (especially if paid by cash) could mean that you will have to pay more tax than you should. So speak now to your accountant to see if they offer a book-keeping service, set up your system to do it yourself and get your virtual assistant to help with book-keeping on the regular basis (TJConsulting can offer great deals for our book-keeping customers using Xero or KashFlow systems).
Always use a contract or send clients your terms and conditions, however small the job – make sure your contract has been checked by a solicitor before you start using it. Not sending your contract through for a “small job” can potentially leave you open to payment disputes, invalidation of your business and/or professional indemnity insurance, claims against your business. Better being safe in the knowledge and both parties have clear expectations and know the rules – so spend that 15-30min to draft your contract and get it signed before starting any assignment. Finally, if the client wants you to sign their own agreement – get it checked first by a solicitor to ensure that there will be no unpleasant surprises later.
Put at least 30% of what you earn aside to cover tax and unexpected gaps in income – August and Christmas time are traditionally quiet in the UK. In any country there will be periods when a lot of people take time off to go on holidays. So cover yourself for such gaps you need to ensure there is enough cash in the business. Another issue to consider is tax. Unlike being employed, when your tax is taken off the salary before it’s transferred to your bank account, when you are running a business you need to remember that taxes are due quarterly or yearly in most cases and prepare for it. Your accountant can give you an estimate of how much tax will be due to ensure that you have enough cash set aside to cover those bills when the time comes.
BONUS TIP: Being a solopreneur doesn’t mean you are alone – although you won’t have a water cooler where you can chat to your colleagues, you can find people in similar position to buddy up with. LinkedIn has a large number of groups specific for industries, interests or locations where you can talk to other professionals, exchange tips and experience. Online and offline networking can offer a sense of community and interaction. Finally, having a business coach or a mentor can offer guidance, support and a sounding board for your ideas. Some of our clients regularly have a business briefing sessions when we help them to sort out their ideas and projects, create a structured system of what needs to get done when, offer a sympathetic ear for their business problems – one of the reasons to hire a virtual assistant.
What’s your top business tip? Please share with other readers!