Being a Freelancer: A Year One Roundup

It’s been a whole year (well 13 months to be precise) since I left my full time job to follow my dream to become a full time freelance Web Designer.  There have been ups and downs in my first year in business and I thought it would be helpful to share my experiences to help other budding freelance newbies.

The decision

Everyone advises that you take on Freelance projects in your own time, build up a client base and then when you’re maxing out your ‘free time’ with freelance projects, make the switch to full time freelance.

That’s great in theory, but for me – I knew that wasn’t going to work. The “day job” was also a “night job”. When I wasn’t working overtime I was trying to catch up on some rest to reduce the stress levels. I also knew that my 3 month notice period was going to be hard to handle if I had a burgeoning freelance workload, but still have to meet the targets of my day job.

I decided to take what I like to call a ‘calculated risk’. Hand in my notice for my full time job and ramp up my freelance work with old contacts whilst I was in my notice period. So I handed in my resignation letter and then started contacting friends, old companies I used to work for and other companies I’d kept in contact with whilst searching for employment in the past. What I found though was that although I had a lot of interest, no one wanted to use me as a freelancer until I was doing it full time.

Being the eternal optimist, I didn’t let this phase me. I used the time to get my freelance company set up so I was ready to hit the ground running on day one.

Setting up

Sooner or later if you are successful, you’ll probably need to setup as a limited company. For two main reasons: one – if you are a Sole Trader and you go bankrupt or lose money YOU PERSONALLY are liable, two – you can claim VAT back on a limited company. I had to purchase a new MacBook Pro and Adobe Creative Suite and could get back around £600 in VAT, so I setup straight away.

Here’s what I did:

1. Decided on a company name.
2. Purchased a domain name that matched my company name (you can use “weare”… before it if you can’t find one directly the same)
3. Spoke to an accountant
4. Set up a limited company
5. Purchased hosting
6. Designed and Coded my website
7. Designed and Ordered business cards

For limited company and payroll setup you shouldn’t end up spending much more than £300/£350. My computer purchases were my biggest outgoing, I used personal savings to purchase these.

Whilst we’re on the subject, if you are going to jump in at the deep end as a full time freelancer, especially without a client base, please please please have some savings to draw on for the first few months. Luckily for me, I’m a saver, I have about 6/7 months worth of savings to keep me afloat if things went terribly wrong. As a minimum though, even if you’re not the cautious type, I’d still recommend 3 months of salary saved to draw from.

Business cards – this was a compromise between quality and cost. I had some wild quotes for business cards, but in the end went with GoodPrint. Good quality, low cost – it was around £20 for 100 cards which was pretty good. I then got a 50% discount from them 2 weeks later and bought 200 additional cards for the same cost… bargain!

Building a client base

This isn’t easy for a lot of people. I’m not really a networker or salesman by nature, but I’ve learnt a lot in my career and am as confident talking to perfect strangers as I am to friends and colleagues. Unfortunately if you are not a born communicator or salesman, you’re going to have to learn, and learn pretty quickly. In my first week as a full time freelancer I targeted around 70 local companies within a 60 mile radius, plus a few London and Manchester companies I’d like to work with.

From this list, I knew only three people.

My business model was to provide additional resource for other design companies, not to directly compete with them. This meant it was easy for me to target business; local design companies and agencies.

So I put together my list and an email that I could add some humour and customisation to. I tried to succinctly explain what I was offering along with a portfolio link (put this as close to the top of your email content as possible) with some of my most favourite pieces of work. This part is the easy part, you can send out a million emails, but this doesn’t pay off unless you follow up with something more personal. I waited a week and a half and then phoned everyone on my contact sheet. This was great, I had half hour chats with some people, got some good advice and more importantly built up a rapport with a few people and got their direct email addresses.

It was a very busy first 2 weeks chasing new clients and that paid dividends. By the end of week 2 I was given my first project. It was a day’s work for a local company that I’d kept in contact with for the last few years.

I did the job and I did it well, the client said they could not find one thing wrong with it. This is important. You need to absolutely deliver on every single project as a freelancer or you are unlikely to get return business. Within only two months, I’d already had another 3 more projects from that one company alone.

One of the important things to remember is that you’re always building a client base, if you have free time between projects, you should be actively chasing for new ones. If you really want to get somewhere you should still be chasing for projects whilst you’re busy.

If you want to keep your clients, deliver a high quality every time and if you can afford to, be honest with them. I choose to let clients know if that £1500 project I quoted for them actually only ended up being a £1400 project. Yes ok, you lose out on money, but honesty is the best policy and if they know you aren’t trying to rip you off then they’ll trust you more.  There does need to be a balance on this though, you shouldn’t undersell your skills either.  If for some reason you were able to find immediate inspiration one day and not another, you don’t want to feel you’re limited to a previous budget.

Workflow

I have a few key items I use:

1. A contract. Provide one for all of your clients and get it checked by a lawyer. This can be a per job contract or a standard set of terms and conditions. This should outline what you are doing for them and your payment schedule.
2. Put together a quote/invoice template with some basic formulas in there. When I started out, I used Open Office with a Quote and an Invoice template, I added my day/hourly rate, my time spent (all itemised) and it works out a total for me at the end including VAT.  I’m now trialing a more complete method that lets me project, track and invoice – along with giving the accountant everything they need: FreeAgent.
3. Track your time on projects. You need to know what types of projects you are doing well on time wise and which ones are a real slog. This will also allow you to reduce invoices for your clients if that’s something you want to do. Although you can use FreeAgent for this, I use Toggl, a free piece of online time tracking software to track my time whether that be through the website, desktop, iOS or Android app.
4. Job sheet. Initially I had a nice big accountant friendly excel spreadsheet with everything I invoiced, any subcontractor costs, parking fees, general office and technology purchases and a mileage log.  Now I use FreeAgent to handle all of that.

In terms of project cycle, I like to keep things fairly transparent…

1. Quote formally, using a unique number for quick reference on your accounts and should a job come in you can search it quickly in your email. I always try and get a quote back within an hour if I’m in the office. The more efficient you are, the more likely you are to convert. It’s a reflection of how you will work on their project, should you win it.
2. Give a rough estimate on schedule with the Quote. For example; “If this is approved by the end of the week I can fit it in here”.  Pencil this in to your calendar to tentatively reserve the time needed.
3. Ask questions throughout. You need to understand what you are quoting on and how to deal with aspects of a project. Keep those communication channels open.
4. Given the green light? Brilliant, send out a contract and confirmation of schedule.
5. Await signed contract and then start the job on or before schedule.
6. Ask more questions if you need to, update the client if its a big project.
7. Deliver (early if possible)
8. Check client is happy with everything before you mention the bill
9. Thumbs up on delivery? Great – send off that invoice and follow the invoice up with a phone call if you don’t hear back. Something like “Hi, just wanted to make sure everything is ok with the invoice I sent over and let me know if you need anything.”
10. If you’re running on a manual system, update the job sheet with job number and invoice date
11. Next job…
12. If you haven’t been paid within your payment schedule, chase it, but be nice about it in the first instance.

Key points to take away (if you don’t have the time to read the above)

1. Have at least 3 months savings to tide you over if new business is slow
2. Get a company name, website, accounts and limited company setup
3. Contact everyone you can think of and tell them about your new business
4. Get a contract drawn up
5. Quote quickly
6. Deliver high quality, every time
7. Be efficient, be friendly but professional