Author Archives: Kim Clark

Professional Development , , 6 Comments

Buff Up Your Business Writing Skills

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Freelance consultants are called upon to do quite a bit of writing.  When we meet a professional contact we’d like to know better,  we send an email to schedule a time to meet and talk further.  We write proposals that help us obtain assignments.  We write press releases,  our bio,  our LinkedIn summary,  thank you letters and sometimes diplomatically written reminders for payment from slow-paying clients.  Some of us write articles,  blogs and newsletters,  too.

Nevertheless,  many of us are a little insecure about our writing ability.  Writing is an important skill.  Written communication helps one to advance and achieve business goals.  It reflects our expertise and our etiquette.  Good writing gets things done,  but it’s not necessary to emulate Pulitzer Prize winning novelists when called upon to express oneself in writing.  All you have to be is a good technician,  not a literary star.   Buff up your writing prowess by following a few easy-to-follow tips:

Purpose     Be very clear about what you must communicate.  A proposal must describe the services that you will provide and persuade the client of your ability to provide those services  (i.e., sell).  When your proposal is accepted,  you write a letter of agreement.  An email might document a meeting or conversation,  or provide follow-up info that was requested.  A press release gives pertinent info about an event or an announcement,  that is expressed in a way that will interest the target audience.

Bullet points     Help yourself complete and organize your message by jotting down the important talking points.  For example, the bullet points of a proposal will describe the services you will provide and benefits that will be derived.  Presenting information in bullet points makes for easy reading and retention.

Format     Once you have your information complete and logically organized,  you might decide to use your bullet points to form paragraphs,  or present the information primarily in bullets.  If you choose the latter,   you’ll want to write at least one opening and one closing paragraph,  so you’ll come across and friendly yet still professional.  Thank you letters,  however,  are generally written in paragraphs and not bullets,  because they are personal and call for a warm and friendly style,  even in business.  Long and ornate sentences are never necessary,  or even desirable.  Clear and simple sentences always work best in business communications.

Edit     Make a draft of what you must write and then begin to edit your work.  After an initial edit,   I like to let my writing rest for a while and then return to it.  Stepping away for even an hour helps me to eliminate wordiness,  provide clarity and continuity,  improve my word choices or add something important that I’ve forgotten.

The task of writing need not be intimidating.  We write when we have a purpose:  to say thank you,  request or recommend a certain action,  announce a decision,  submit a proposal.  Writing is all about being understood and getting results.

Thanks for reading,

Kim

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Challenge B2B Sales Assumptions

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A new hypothesis on how to succeed in B2B sales has exploded onto the scene and Freelance consultants had better take notice.  “The Challenge Sale”  (2011),  written by Brent Adamson and Matthew Dixon,  has turned received sales wisdom onto its head.  According to the authors there’s no such thing as Santa Claus,  the Easter Bunny is dead and relationships don’t mean much  when you’re trying to make a sale.

These  startling findings are based on extensive research.  Adamson and Dixon studied 700 sales professionals and then followed up with a global analysis of 6,000 sales people who make their living in complex B2B sales.  They first identified five selling styles:

The Hard Worker                      self-motivated;  goes the extra mile,  won’t give up easily

The Problem-solver                focuses on service issues;  detail-oriented;  excellent with post-sale follow-up

The Relationship-builder      very customer-focused;  generous with time and attention

The Lone Wolf                            self-assured,  follows his/her own instincts

The Challenger                           has a different perspective;  understands the client and his/her business;  loves to debate

When it comes to B2B sales,  Challengers blow everyone else out of the water.  According to the data,  40%  of top-performing B2B sales reps are Challengers.  A mere 7%  of Relationship-builders can claim that distinction.  How do Challengers do it?  They display six game-changing attributes and trying to be the client’s friend ain’t one of them:

1.  Offers the client unexpected options on how to get the job done

2.  Has strong interactive communication skills

3.  Knows the client’s value drivers

4.  Knows the organization’s economic drivers

5.  Comfortable discussing money

6.  Willing and able to pressure the client

The wily Challengers mix these attributes well and have come up with this recipe for the sales-winning cake they bake:

Teach for differentiation

About 53%  of what drives B2B purchase decisions  (like the awarding of project contracts)  is the Freelancer’s /salesperson’s ability to teach prospective clients something new,  to challenge their usual way of thinking,  the standard approach.  Challengers persuasively deliver information and methods that lead clients to see their situation in a new light that  (they think)  will help them improve competitive positioning,  make money,  save money or do whatever it is that they want to do,  all in a way they didn’t know was possible.

Tailor for differentiation

To win a contract today,  the Freelance consultant often has to build consensus and win over a group of stakeholders who have varying amounts of influence on the hiring process.  Job-seekers grapple with this reality also,  as they face down search committees that now control the hiring for nearly every position, no matter how lowly. 

Adamson’s and Dixon’s research shows that Challengers respond to this environment by treating each stakeholder as an individual client,  learning how each one’s role fits into the organization and tailoring a sales pitch specifically to that role and its attached priorities.

Take control of the sale

As our ailing economy drags on,  the authors estimate that 80%  of business is lost to no decision at all.  No,  it’s not your imagination.  Most sales  (or proposed projects)  really do just die on the table for lack of client follow-through.   When it comes to complex buying decisions,  clients have become paralyzingly risk-averse.  Many economists and business experts have pointed out that this practice does organizations more harm than good,  but there it is.  

Furthermore,   Freelance consultants also know that many,  if not most,  clients use the ailing economy as a pretext to get our expert labor on the cheap,  always scheming to wheedle a discount out of us when a contract does get offered.  Challengers are  not swayed by this tactic.

Rather,  s/he sidesteps requests for price cuts and re-directs focus away from price and onto the value of the product/service.   Challengers know that a solid value proposition makes clients more willing to pay a premium.   S/he sells their service’s  (or their product’s)  unique ability to meet or exceed expectations,  meet crucial deadlines,  solve a difficult problem,  or save/ make money for the organization.

Adamson and Dixon claim that the combination of teaching,  tailoring and taking control draws on constructive tension throughout the sales process.  Challengers teach clients how to build consensus for the sale  (project)  by engaging the right stakeholders with the right message.  They don’t cave in to pressure to cut their price.   Moreover,   they do it all in a respectful,  never aggressive manner.   Are you ready to Challenge?

Thanks for reading,

Kim

Business Strategy , Leave a comment

Be a First Class Freelancer

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What do clients want when they look to hire a Freelance contractor?  On a conscious level they know that a job must be done and that the time and/or expertise to do the job does not reside within the organization and so outside help must be brought in.  They know certain deliverables must be produced within a particular time frame and they know what can be spent to achieve their objectives.  But what makes a client hire one Freelancer over others who may be interviewed?  What is the secret sauce that can make you be The One?

Be creative,  perceptive and adaptable

During the first meeting,  First Class Freelancers can quickly and accurately assess client needs.  Failing that,  s/he will know the right questions to ask that draw out and clarify objectives and priorities.  The First Class Freelancer will know whether and how their own skill set will match with client needs and will be able to articulate that assessment in language that is readily understood.   As a result,  trust and confidence in your abilities are quickly established and the foundation for rapport-building and a productive working relationship is set.

An experienced pro

If you nail Step One,  the client will know that you have the goods to meet and very likely exceed expectations and that there is no doubt that you will get the job done and make him/her look good to both superiors and subordinates.  First Class Freelancers let it be known through their grasp of the client’s big picture needs that the ROI of bringing them in will be substantial.  Deadlines will be met and work will be of the highest quality.  This allows the first class crew to command  premium prices and the client doesn’t quibble,  because his/her reputation is about to be enhanced.  If necessary,  s/he’ll go to bat for you and get more money appropriated for the project to cover your fee.

Operate like a business

Be highly professional in client interactions and all forms of business communication.  Follow-up promptly,  invoice at the appropriate times and write good proposals  (that are really confirmations,  because you’ve impressed the decision-maker and pretty much know you’ll win the contract).  Present yourself as an equal and a peer,  but respect boundaries and remember that you have a green card but you’re not a citizen.  Radiate confidence and success  (but never smugness or arrogance).  Create the impression that although times are tough,  you have a viable client roster because you have credibility and competence.

After you’ve been out on your own for a while and identified the types of projects that you like and the types of clients that tend to hire you,  carve out a specialty niche where you can excel.  Resist the temptation to take any and every project that comes your way  (unless the cupboard is bare).  Develop the corresponding verbal packaging that will be your business introduction and elevator pitch,  as well as online and print collaterals that effectively represent and communicate your brand.

Smart negotiator

It’s during contract negotiation that your prospective client will know what you think your time and talent are worth,  how experienced you really are and the prestige level of the projects you’ve previously worked on.  If you accept the first offer that’s given and consequently sign for noticeably less than expected,  they’ll know you’re wet behind the ears or you’ve only done low-budget projects.  They’ll know you’re not in the big-time.  This information will also be telegraphed if you fail to discuss payment terms during contract negotiations and ask for some percentage of up-front money before you start work.

Get busy and write yourself a fist class ticket so you can get paid to travel in style!

Thanks for reading,

Kim

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Heads-up: Google + Business Pages

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At last it is here.  The business page option for Google Plus was rolled out in November of last year.  The early adapters are still figuring it out,  but the consensus is that Google + is an innovative and useful social marketing tool for Freelancers,  business owners and our customers.   Google + combines and enhances the business-friendly social networking features of Facebook,  LinkedIn and Twitter and presents it all in one platform.

You’ll be able to share links,  location data,  photos,  videos and have interactive two-way conversations on the Plus platform.  Ian Schafer,  founder of the Manhattan digital marketing agency Deep Focus,  says  “Integrating with Google + is essential right now,  because of its impact on Google search results.  Experimentation will give businesses  (especially small ones)  a leg up on their competition.”

But all is not rosy.  First of all,  you need a Gmail address to set up and access the service.  On top of that,  there is as yet no cross-platform integration with other Google services.  Plus doesn’t mesh with Analytics,  Blogger or YouTube.  The company vows that full integration is on the horizon,  but an arrival date has not been promised.

As with all social media,  you must sign up  (with Gmail)  and create a profile.  Like LinkedIn,  describing your services is the name of the game.  The  “About”  tab is especially important,  for this is how visitors to your page will elect to invite you to connect with them  (or not).  Present an informative,  compelling profile and tell the story of you and your products and services.  You may provide a link to your website.

Like Facebook,  photos figure prominently in you Plus profile.  Before you sign up,  create five photos of yourself in action as you provide different aspects of your services,  sit on a panel,  speak or teach,  take a meeting or whatever.  Those photos will be uploaded to the Photo Strip,  which is displayed beneath your business name and tag line on your home page.

Next you can populate the  “Circles”,  “Sparks” and  “Hangout”  sections.  Circles are grouping categories for your connections.  Hangout lets you set up various group events and invite contacts from your Circles and also the public to interact in useful and engaging ways.  Sparks is a streaming feature that lets you choose to receive info that keeps you updated on business issues of interest to you.

Invite clients and professional contacts to join Circles that you will designate.  You get to curate what information is shared with contacts based on the Circle you place them in and that decision will be determined by their relationship to you and your business.  You may designate Circles for clients,  peers and colleagues,  members of your business advisory board,  friends,  press updates,  or whatever categories seem appropriate.

Through interactions with those in your Circles,  you may refine your understanding of what contacts would like to know about your business,  how your services can be packaged and marketed and/or what clients value most about your services and how you can become even more valuable.

Like the LinkedIn Answers forum,  questions can be posted and Google+ members can offer answers.  It’s a great way to expand your connections and build relationships by sharing your expertise.  Visit http://findpeopleonplus.com to find professionals in your target markets and find out what’s on their mind,  how you can help and who you want to invite into a Circle.

Hangout is a very intriguing feature of Plus.  It one-ups Facebook and the Skype connection.  Real-time interactive communication is possible on Hangout and with a larger audience.  Reportedly,  the Dalai Lama recently hosted a Hangout with Anglican Archbishop Desmond Tutu with an audience of millions. 

 With Hangout,  those of us who teach now have a way to present our courses and workshops in a free online classroom that will host up to 10 students in a group class.  Private consulting sessions are also possible with clients who live anywhere there is internet access.

So check out Google+ and consider the benefits for your business.  49 million hits were made on Plus in December 2011 and analysts predict that Plus will have 400 million users by year-end 2012.  Google is the word’s biggest search engine and inbound links are increasingly important in search engine marketing.  A well-thought out and crafted Google+ page has the potential to draw in prospects with the money and motive to join your client roster,  the best Circle of all.

Thanks for reading,

Kim

Marketing , , , , 1 Comment

LinkedIn Profile Refresh

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Happy Year of the Dragon!  The New Year vibe is still rolling,  so I wonder if you’d like to keep-up the self-improvement kick and take a fresh look at your LinkedIn profile?  Usually,  I revisit mine about once a year.  Last year,  I pared down my rather long and complicated summary section. 

 I realized that in certain instances,  less is more and simplified my statement.  About  every 12-18 months,  I think it’s useful to make sure that my LinkedIn profile aligns with how I’m positioning myself and what I’m saying in the verbal package that is my elevator pitch.   So let’s do a little housekeeping.

Purge the clutter

Comb through your job history and weed out or streamline whatever does not support and enhance your professional goals.  Retain several years of your employment history,  but limit non-aligned jobs to title,  company and a one-sentence description of your responsibilities.  Use you employment and volunteer experience to reflect your brand and professional aspirations.

Add keywords

The headline of your profile is the critical factor in search results.  Choose your most relevant keywords carefully and add to your headline.  Be mindful of the subtle difference between keywords that are vital for your business / career and terms that are frequently searched.  If you provide services for a select market those keywords should reflect that market,  even if they are searched less often. 

 Judiciously embed relevant descriptive keywords that are associated with your business category into your headline and summary sections.   Visit Google Keywords Tool and identify popular keywords that will attract a sufficiently broad audience in local searches and then drill down to target your niche by discovering keywords that industry insiders might  search.

Add apps

Install Slide Share and upload a Power Point presentation to your profile that will communicate more specific details about your services.  I use WordPress Blog Link to invite connections and visitors to my page to read weekly blog postings.  I always write an excerpt that I hope connections will find tempting when LinkedIn Updates announces the arrival of a new post.

As of last week,  visitors to my profile will now find the app that was rolled out just a few months ago,  the Skills App.  The nice feature about  Skills is that you’ll receive data on groups that focus on that skill;  companies where that skill is common;  posted jobs requiring that skill;  and the size and growth trends of other professionals who hold that skill. 

Other free apps that may serve you well include Events,  that will let connections know the meet-ups and conferences where you will speak;  Portfolio Display,  that allows creative types to showcase their work;  and Reading List,  that allows you to share with connections the professional development books you’ve read and get ideas on additional books that you might find useful.  All of the apps will appear on your profile page.

Get recommendations

Recommendations are testimonials that provide third-party verification of your expertise and further support your professional goals and brand.  Ask a professional colleague who can vouch for your work to detail your contributions to a project that went especially well. 

 Specific,  quantifiable information that highlights your impact on company objectives enhances your credibility and is more believable than effusive compliments that merely tell people how talented you are.  Always return the favor and write a recommendation for those who produce testimonials for you.  In fact,  get the process started by  “spontaneously”  writing a recommendation for a colleague so that you can receive one in return.

LinkedIn is about creating and nurturing relationships,  so do your part and engage in conversations.  Congratulate your connections when an update comes through that heralds an achievement.   When you invite someone to join your network,  tell that person why you’re inviting them.  When someone invites you,  take the time to thank that person for his/her consideration.

Join groups appropriate for your skill set and goals and become known for posing good questions,  leading discussions and sharing timely and useful information.  Visit the  “Answers ”  forum and contribute thoughtful responses to questions that will allow you to showcase your judgment and expertise.  Utilize the free resource that is LinkedIn to position yourself as a go-to resource in your niche.

Thanks for reading,

Kim

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Probability Prospects

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You’ve just been introduced to a person who was not only happy to meet you because you have the chops to take on a hot project that’s on his/her radar screen,  but also has the authority to green-light your hire.  Oh, happy day!  You’re thrilled to do the card exchange as your newest prospect asks you to make contact so that the two of you can talk specifics.  You can almost taste the billable hours,  but how excited should you be?  Statistical probability can help you put a dollar value on your happiness quotient.

I found this intriguing formula that uses sales outcomes historical data and probability that allows you to calculate the expected value of your next prospect.  As has been noted in numerous posts and no doubt reflected in your own experience,  there is a randomness to networking and Freelance consulting.  In our effort to bring much-desired predictability and financial security to our lives,  the Freelancer’s  (and all salesperson’s)  objective is to control variables,  positively impact outcomes and therefore win more projects and generate more revenue.

Let’s say you’re talking to a prospective client about a project that you estimate should be worth $10,000.00.  The operative word is should.  $10K is the potential value and not the real value until and unless one is awarded the project.  If you don’t win the project,  then it’s worth zero.

Your project’s worth is impacted by the probability of successful close.  The following formula allows you to calculate the potential value of the prospect and the project throughout the various stages of the sales process.  Both the steps in the sales process and the values assigned at each step in the process are based on historical data provided by a large corporate sales force.  To refine the accuracy,  identify the steps in your usual sales process and record your sales success rates at each stage of your sales process.

I.     Identify the steps in your sales process

  •      Invitation to meet and discuss the project
  •      Initial appointment / discussion of of needs and benefits
  •      Verbal proposal / assessment of needs and benefits
  •      Invitation to submit written proposal

II.    Determine the probability of a successful outcome at each step

  •       Invitation to discuss project                                                      2%  success probability
  •       Initial appointment / discussion of of needs                       8%  success probability
  •       Verbal proposal/ assessment of needs and benefits      25%  success probability
  •       Invitation to submit written proposal                                 65%  success probability

III.   Calculate the dollar value at each point of the sale for a proposed $10K  project

  •        Invitation to discuss project                                                     $   200.00
  •        Initial appointment / discussion of needs                           $   800.00
  •        Verbal proposal / assessment of needs and benefits      $2,500.00
  •        Invitation to submit written proposal                                  $6,500.00

The key to customizing the outcomes probability formula for your business is keeping detailed records of  sales presentations from which to compile your statistics.   In other words,  here is yet another reason to document your business transactions so that reliable data will be there to guide business planning.

Thanks for reading,

Kim

Business Strategy, Sales , , , Leave a comment

Sales and Networking Resolutions for 2012

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Welcome back for the final installment of New Year’s resolutions.  To keep yourself motivated to do what you resolve to do,  be aware that the key to success with any resolution,  personal or business,  is willpower.  Once you’ve set your goal,  then it’s all about execution.  Willpower—call it commitment or perseverance if you like— is the x-factor that most often separates winners from losers  (although good luck helps, too!).

Invite success by instituting systems that will keep you on your path.  Always develop strategies and an action plan for each resolution/goal.  Write up your resolutions and action plan timetable and tape it to your office wall.  Enter action plan activities and tasks into your calendar.  Attach notes to your file cabinet or refrigerator.  Reward yourself when key milestones are reached.

Resolve to network with purpose

A colleague named Lisa is very proud of her networking schedule.  She brags about attending five or six events every week.  The girl is everywhere.  A colleague named Erika is out and about less often.  She attends an event about once a month and works on getting to know the right people and building relationships over time.

So which Freelance consultant has the better reputation and bigger billable hours?  Erika does,  by far.  She works with name brand clients and she always seems to have a job in  (or has just completed or is about to start).  The last time Lisa and I spoke,  she told me that she hadn’t had a client in about six months.   So what’s up? Apparently,  Erika has figured out a networking strategy and activities that bring opportunities.  Lisa’s  “networking strategy”  seems to leave her with nothing but a bar tab and a tax write-off for event admission charges.

It’s interesting,  because it was Lisa who schooled me on the importance of having a networking agenda:

  • Get a client
  • Get a referral
  • Get information

Unfortunately,  the girl does not follow her own advice well enough.  While it’s advantageous to have a presence among peers and potential clients and also check out a fresh venue now and again,  it’s more important to know who will be in the room and understand why you should spend time and money to be there.

Swanning around town is not a viable networking strategy.  The process obviously is random and we never know when and where our next good client will appear—maybe in Pilates class?—but you still need to institute a system and go fishing where the fish you can catch will be.  Review your networking strategy and its ROI.   How did it contribute to your sales pipeline and what was your conversion rate?  Which events might you add or delete?

Take time also to refine the verbal package that is your elevator pitch.  Are you communicating the right info about your talents and services that grabs the attention and respect of potential clients? Do you know what their hot-button issues will be in 2012?

Resolve to show more than tell

Clients want relevant information about your services and how they will drive objectives.  They need to be assured that bringing you in on a project will make them look smart to both subordinates and superiors.

Rather than just droning on about how wonderful you are,  show prospective clients what you can do for them.  Set up this process by doing some research on the organization and its mission and customers.  Get a working knowledge of how your expertise will be useful.

If possible,  tell a story of a similar project you’ve successfully worked on,  to paint a picture that helps the client visualize how what you do fits with their needs.  With that approach,  you may even be positioned to up-sell services they didn’t know they wanted.  Present yourself as a trusted resource who is there to promote the client’s interests.

Good luck with your resolutions and thanks for reading,

Kim

Business Strategy , , , , 11 Comments

Business Planning Resolutions for 2012

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This week we’ll consider where you’d like to take your business,  what you’d like it to look like and how you’d like it to operate.  Every journey has a destination or goal.  The journey of your business should not be random;  it deserves careful thought and planning.  Reserve some quiet time to think about the journey of your Freelance venture.  You may want to start by reviewing where you’ve been.

Which kinds of clients and assignments give you the most fulfillment?  Which let your talents shine and/or bring in the most money? What competencies have you learned along the way?  What has taught you to become wiser and more confident?  What were your successes and what would you like to do better next time,  or maybe avoid altogether? Take stock and make a plan for the New Year.

Resolve to develop business goals and strategies

This sounds obvious,  but we all know that it’s very easy to get totally caught up in just trying to find clients and get paid,  getting tunnel vision.  We become like the hamster in a wheel,  busy–busy running in circles,  without giving adequate thought to our actions and following a road map.  As a result,  we can be going nowhere fast.

Start this year by nurturing yourself and taking time to reflect on what has transpired over the past year or two and acknowledging how you feel about it.  Did you set goals for your business? Were they realistic for you?  Which goals did you achieve and how did that occur?  Re-evaluate the direction it makes sense for your business to take and brainstorm strategies that you can enact  (alone or with the help of colleagues)  to bring it there.

Planning is the only way to create a successful business venture.  Set your direction and develop SMART goals :  Specific, Measurable,  Attainable,  Realistic and Time-bound.  Next devise strategies,  the path you will take to reach the goal.  Follow through with action plans  (with dates attached),  to keep you moving forward and on schedule.  Revisit your goals in three months and assess what is working,  what needs tweaking and what should be jettisoned.

Resolve to reaffirm your business model

The business model is the framework by which the business functions as a business:  the products and services that are offered;  by what methods,  in what location and by whom products and services are delivered to customers;  how the business will attract and retain customers;  the length of the sales cycle;  and how and when payment for products and services will be made.  Is your business model operating effectively?  In 2012,  take steps to ensure that your operation functions like a well-oiled machine.

For Freelance consultants,  the system of outreach to potential clients is often a sticking point.   Periodic review should be given to the products and services offered and how they are packaged,  presented, delivered and priced.  Talking with trusted clients is a good way to get feedback on your business model.  If you’re a LinkedIn member,  visit the Answers Forum and put questions out to your peers.  You will likely receive much useful information.

Finally,  review how you typically obtain clients and prospects.  Do you solicit them  (and how that happens),  do they find you  (and how that happens),  or do colleagues make referrals and introduction?  Which method has the best conversion rate?   What is the profile of organizations that have become your best clients over the past three years? Use what you learn about all of the above to buff up your business model and set the stage for a more profitable 2012.  New Year’s Resolutions will conclude next week.

Thanks for reading,

Kim

Administrative , , , 2 Comments

Business Finance Resolutions for 2012

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Happy New Year!  Thank you for coming back in 2012.  The New Year is here and the time is ripe to take a fresh look at how you can bring more revenue and profit to your Freelance business.  The purpose of this blog is to inform and inspire readers to create the conditions that will generate a successful and rewarding Freelance consulting career.  Let’s get the ball rolling and look at how effective financial management promotes that goal.

Resolve to skillfully manage cash flow

Cash is king and cash flow is the life blood of every business.  Nothing flows unless the cash does.  Cash flow management means knowing how much money is expected to enter your coffers and when those checks are expected to arrive,  along with knowing how much money must be paid to creditors and when those checks must be sent. 

Even if you show a profit on your P & L,  it’s possible to have insufficient cash in hand to pay monthly bills and other accounts payable.  We all know that working as a Freelancer can be a cash flow nightmare,  so it’s vital to get arms around the accounts receivable,  or else sleepless nights will haunt.

Cash flow management actually begins in client meetings.  Once your project fee has been addressed and agreed upon,  diplomatically state that 15% – 20%  is paid at contract signing and that invoices are payable upon receipt.  Payment schedule for the balance will depend upon the length,  type and cost structure of the job. 

Whatever you do,  don’t allow more than 35%  of your fee to be payable at project conclusion  (unless it’s a small job).  Take steps to discourage the client from preserving his/her organization’s cash flow at your expense.  Write payment terms into the contract,  right along with the scope of your work,  deliverables and start date.

Resolve to get paid what you are worth

Establishing value and getting paid for same is the goal in every service business,  whether it’s teaching piano or being a nanny.  Your pricing strategy should reflect the value that your services bring to the client.  Needless to say,  pricing supports  cash flow and revenue.  To identify an appropriate fee range,  pricing experts recommend that you focus on four factors:

  • The perceived value of the services your provide
  • The demand for your services  (and your reputation as a purveyor)
  • What’s involved in the delivery of your service  (time = production cost = the Freelancer’s cost of goods sold)
  • Your mark-up / profit margin

Resolve to create and analyze the basic financial statements every quarter

Freelancers have a good idea as to how we’re faring financially,  because we either have the desired amount of money in the bank or we don’t.  We either have jobs in-house or we don’t.  We have either big jobs in or small jobs.  Like a balance sheet,  your bank statement provides the snapshot of your financial picture at a given moment.

There’s nothing like creating and then actually contemplating and analyzing one’s cash flow and income  (profit & loss)  statements to truly grasp your true financial picture and most importantly,  receive clues as to what would be advantageous for you to do about the business model,  sales and/or marketing segments of your consultancy.  Smart business decisions are invariably data-driven.

As you analyze your financials over the years,  you may identify regularly occurring busy periods and decide to hire temporary help or bring in a Freelance sub-contractor,  to give you another pair of hands at those times and allow yourself to make more money. 

Slow periods will likewise be identified.  You’ll be encouraged to find a way to either stimulate business during those times by incentivizing clients to hire you,  find temporary work,  find classes to teach (if that’s one of your competencies),  or engage in prospecting,  networking and professional development activities.

Next week,  I’ll return with more business-themed New Year’s Resolutions for 2012.

Thanks for reading,

Kim

Professional Development , , , Leave a comment

The Road to Freelance

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Many established professionals consider leaving the world of traditional employment and launching a Freelance consulting career.  The growing lack of job security,  as evidenced by the unemployment rate,  along with the increasing occurrence of toxic work environments endured by those who are working,  have caused many people to give serious thought to self-employment.

I’ve found much personal and professional satisfaction in Freelance nation but there are challenges.  Preparation is key and if you’re still on the job,  begin now to build the infrastructure that will support your transition.   Take the steps while on the corporate dime to sock away some cash and learn how to approach your business clients and contacts as an independent professional.  Learn how to package and sell your services and determine and negotiate fees for the scope of work you will perform.  Visit professional associations and meet Freelancers who do what you aspire to do and ask some questions,  especially on how to build visibility and credibility as an independent consultant in your industry.

Build your savings account

Aim to have savings that will allow you to cover your living expenses for 12 months.  You don’t know how long it will take to sign your first client,  or the one after that.  Freelancers,  especially in the beginning,  will need cash to float themselves,  especially if one is the sole or primary breadwinner.  Furthermore,  scheduled  projects have a nasty habit of being delayed or even canceled.

Start saving money now by eliminating those $5.00 coffee drinks.  Brown bag your lunch whenever possible and cut back on nights out eating and drinking by 75%.  Do not buy any clothing you don’t absolutely need and cancel any vacation plans.  Remember that in addition to paying for living expenses,  you may need to buy or upgrade technology hardware and/or software and will also need to pay for marketing materials  (business cards, website, etc.)  so that you can effectively operate and promote your business.

Business plan and business model

You must figure out how you will get clients,  select the services you will offer and how to determine your fees.  You must choose the marketing materials you will use and decide what they will look like.  You must define the best target client groups and know how to approach them and convince them to hire you for Freelance work—even if you’ve worked with them as an employee of you current organization.  Do you need to be accepted onto an approved vendor list in order to be considered for hire?  Discreetly ask questions of those you can trust to not rat you out to your boss.   Also get an understanding of the typical length of the sales cycle.

Additionally,  it is necessary that you assess the competitive landscape.  The presence of competition is good,  as it demonstrates the need for services you provide and shows that Freelancers are hired to fulfill those needs.  However,  you don’t want to be in an over-crowded marketplace,  unless you are a very heavy-hitter.

Finally,  summon the discipline to write a business plan.  A mission statement,  comprehensive marketing plan and basic cash flow and profit and loss statements will provide a useful road map to get you started and encourage you to examine what will be required to make your Freelance venture successful.  I wish you the best of luck.

Thanks for reading,

Kim