So you want to start up a freelance business? You're not alone.
Freelancers represent one of the fastest growing segments of the U.S workforce. Faced with declining numbers of full-time, salaried work opportunities, many professionals are turning to freelancing as a viable alternative to traditional employment.
But the most successful freelancers approach their job with the same planning and professionalism as a high-achieving small business owner. If your idea of freelancing is lounging around in pajamas, drinking Mai-Tais and grooving to the beat of your favorite Bob Marley tune, you won't last long as freelancer. A freelance business has a lot of benefits, but it will also require you to work harder and smarter than ever before.
- Treat it like a business. Many freelancers fail to treat their business like a business, resulting in career setbacks, investment losses and short-lived freelance experiences. Even though your business consists of a single employee (you), it's still a business and needs to be treated like one.
- Find a niche. Profitable businesses identify a market niche with room for growth. Your freelance business is no different. When it's time to start up a freelance business, one of your first steps is to assess the marketplace and determine where you business fits in the big picture.
- Establish reasonable fees. Many freelancers stumble when it comes to pricing their services. Although you have to cognizant of market realities, your fee schedule needs to be based on an hourly rate that takes into account the time you'll spend doing administrative tasks as well as the additional costs that are associated with self-employment.
- Set goals. If you haven't written a business plan yet, get started. Along the way, you'll want to establish both short-term and long-term goals for the business, including an exit strategy that considers your personal financial goals and objectives.
- Market yourself. Freelancers are often uncomfortable with marketing because it requires them to market themselves rather than a product. But in a freelance business, you are your product. Self-promotion isn't about ego – it's about promoting your services to your customer base.
- Track financials. Financial accounting for a freelance business is usually much easier than it is for the average small business. But it's still helpful to track financials for monitoring and tax purposes. Although hiring an accountant may seem like an unnecessary expense, a decent accountant usually costs less than the hourly rates you lose by trying to do it yourself.