We’ve just passed the deadline for filing annual taxes. Are you feeling a little cash-poor? Should we talk about how to put a little extra $$ into the revenue column? I suspect that landing a big client will have the most positive impact on your earnings, but counting your pennies and smart planning are always a plus. You just need to discipline yourself to adopt those good habits. Once you do, they’ll become part of your regular routine, the standard way that you do things.

Price right

Don’t be afraid to request adequate payment for the valuable services you provide. Low-balling never got anyone anywhere. I understand that when the cupboard is bare you just want to get a project in-house, fast, and it may seem as though a bargain price will entice prospects to quickly hire you. The problem is, prospects inclined toward cheap labor tend not to respect those whom they hire. You could find yourself in the mix with a difficult client who’s not only a low-revenue client, but also a slow payer. Respect yourself and your abilities and don’t go there.

Pricing B2B services is tricky, though, and benchmarking your price range is difficult. You can’t go online and research what competitors charge for a similar service. Who you know and who knows you, along with work experience in your area of specialty, number of years in business, university degrees and professional certifications and your client list are among factors that potentially impact how you can price. Your unique way of packaging and selling your skills and experience can be another determining factor. You might refer to the March 15, 2022 post Is It Time for a Price Increase for more thoughts on pricing B2B services.

Invoice on time

Freelancers don’t get paid to invoice, but you don’t get paid until you invoice. You must get serious about collecting accounts receivable. Get into the habit of preparing your more detailed invoices a little at a time throughout the month and consider sending invoices during a certain week—like the first or last week of the month. On all invoices, state that payment is due upon receipt. In general, payment is due within 30 days, but a 15 day grace period is typically extended, meaning clients legally have 45 days to pay. If you haven’t received payment by day 48, resend the invoice.

Furthermore, track the time that you spend on projects billed hourly. It’s very easy to underestimate how may hours that you work. I recently reviewed the amount of time that I spend on a recurring hourly project and was shocked (and embarrassed) to realize that I’ve been billing slightly more than half of the time that I should be billing. Corrective action will be gradually taken. I don’t want to give my client sticker shock, but I will discreetly align my invoices with the time spent working.

When discussing the work agreement with a client, ask for a 15% – 20% upfront payment on projects that you’ll bill at $1000 or more. Schedule payments to align with project milestones and leave no more than 30% outstanding for the final payment. On your invoice, indicate how you would like the check made out. If you accept credit and debit cards, electronic checks , direct deposits , or PayPal, include those options on your invoice as well.

Anticipate expenses and set money aside

Create a spreadsheet to help yourself anticipate and plan how to pay predictable expenses, fixed (e.g., quarterly tax payments, utility bills, health insurance) and variable (business association dues, professional development courses you’d like to attend), to minimize the arrival of unpleasant surprises landing in accounts payable. Next, calculate your expected accounts receivable. The document you’ll create is called a cash-flow forecast and is used to predict and plan ahead for 12 months.

Are you coming up short now and again? Figure out how to fix the problem. There are near term and long- term remedies that may be feasible for you. I recommend that you look to money raising opportunities that are related to what you do. But if you must tend bar, for example, do so if the money is good and you won’t run into clients.

• Are you qualified to teach? Becoming an adjunct professor at a local college pays fairly well and it’s an excellent addition to a Freelancer’s CV. Teaching implies expertise and will enhance your brand and perceived value. Most schools will require that you have a master’s degree, but it doesn’t necessarily have to be related to subjects that you teach. Entrepreneurial incubators also hire instructors to teach subjects such as finance, tech and marketing. Do some investigation. Your real world experience can be leveraged.
• Do you have good writing skills? If so, there are a number of money- making avenues to explore, including blog or newsletter ghost writing and marketing content for websites. Writing social media posts is another possibility. Join and browse writing and editing Freelance gig work on sites such as Fiverr and Upwork.
• Align the payment due dates of your significant accounts payable with the part of the month when you usually have the most money. If you have a payroll to meet, W2 or 1099, time your accounts receivable payments to paydays you must guarantee
• Call the companies you must pay and ask to change the due dates to stagger them or schedule your payments to that sweet spot in the month when you have the most money. You can also apply for a business credit card that can be used to pay certain expenses, but do keep an eye on the balance because credit card interest rates are exorbitant.
• As a long-term tactic, review your inbound marketing tactics and amplify that which is not bringing in good prospects. For example, do you have two good client testimonials on your website? If not, consider who might be willing to go on record to sing your praises. Re:outbound marketing, consider dropping into your local chamber of commerce to see if those you’d like to meet are known to attend events. If possible, join for a year and see who you meet and what you learn, Buy a small ad in the chamber newsletter to raise your profile and maybe get the opportunity to speak or present a one hour course.
• The best move is to build up a rainy day fund when your cash finally starts flowing. My fund saw me through the barren early months of the pandemic shutdown. I was still skimping, but I made it. Aim to save for a 6 month cushion.

Thanks for reading,

Kim