As a freelancer, you’ll need to make business decisions. These can range from everyday decisions, such as ordering stationery, to more significant financial decisions, such as tax planning or reviewing your prices.
In any event, here are 3 key ones you’ll likely need to consider:
1. How much to charge
What and how you charge will be a large factor in your overall success.
Some freelancers prefer to charge a flat rate per project rather than quoting an hourly rate. One of the reasons for this is that if you are performing a routine task, the quicker you get at doing it, the less money you make if you are exchanging time for money. Furthermore, hourly rates can spiral out of control if the project overruns and the client hasn’t budgeted for the extra hours.
However, hourly rates do work well with some tasks and clients, and there’s no reason why you can’t charge a combination if the work allows it. For example, you could charge a project rate and then a flat fee or an hourly rate for any work that falls outside the original scope. Some freelancers base their fees on value pricing, where they charge for the value they provide rather than the hours worked.
There are many ways to price a project, and what you charge will be relevant to your outgoings, profit margins and freelancer money goals. However, regardless of the pricing option you adopt, it pays to understand what your hourly rate is so you know exactly how long a task takes and the cost to you, including research and all the other things you need to do before you start the ‘work’ work.
Time yourself on a series of tasks and include everything. You may be surprised at just how much time they take and realize you need to charge more. It’s a harder client sell to increase rates if you start out on a rate that doesn’t accurately reflect all the work you do, so start as you mean to go on and charge your full worth.
With Invoice Nina, a leading free invoicing software for small businesses, you have a task time-tracking feature that allows you to accurately record every second spent on each individual task and quickly transfer timed data to the relevant invoice with 1-click.
We also offer a Google Chrome task extension, allowing you to manage all your tasks directly within Chrome.
Try Invoice Ninja for free at the link here.
2. How and when to get paid
How and when to get paid are important considerations that will have an impact on your cash flow. For example, for a small project with a limited budget, you might request 100% payment upfront. Alternatively, for a long-running project, you might consider adopting milestone invoicing, which allows you to receive payments at intervals throughout the project, along with an agreed-upon percentage as a deposit. On the other hand, you may have retainer clients and send them recurring invoices at regular intervals, such as monthly.
What, how, and when you get paid will be outlined in your payment terms and conditions, so it is essential that they are agreed upon before you commence work with a client. Regardless of the payment terms you apply, you’ll want to make it easy for clients to pay you. That’s where invoicing software can help you get paid fast.
Invoice Ninja integrates with several popular payment gateway providers. Integrating your Invoice Ninja account with a payment gateway allows clients to pay their invoices with just 1-click! The payment gateway processes the transaction in the background while your client never leaves their Invoice Ninja client-side portal.
Our payment gateways include Stripe, PayPal, GoCardless, and more. Plus, you can now get paid in Bitcoin thanks to our integration with BTCPay Server.
3. What resources are needed
The resources required will depend on the nature of the work, but as a small business owner, it’s not just the equipment and tools needed to perform the job that need to be considered, but also the tools you use to market yourself. This includes whether you require a website, a landing page, or rely on social media platforms or word-of-mouth referrals. Your marketing assets are also your resources.
Tools can range from automation tools, such as meeting schedulers and invoicing software, to platform integrators that speed up your workflow, like Zapier and Make, as well as productivity apps, among others. What tools work for another freelancer’s business might not work for you, and vice versa, so it makes sense to take into consideration all the relevant factors so you don’t fall foul of shiny object syndrome.
You may also consider whether there’s anything you need to outsource or hire another freelancer to do. If you consider resources from a more holistic perspective, you’ll gain a better understanding of the bigger picture.
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Naturally, there are many other decisions to consider, but when it comes to making decisions about your freelancer business, it helps to know your end goals before you start so you can ensure any decisions align with them.
To avoid analysis paralysis, create a list of all possible options and cross off the ones that don’t align or won’t work. You’ll soon be left with just one or two options that you can then execute. Taking action is key.
