More and more people are deciding to freelance full time, with the Freelancing in America:2019 report indicating that this number has grown to 28 percent, up from 17 percent just five short years ago. This report further shows that, in the U.S., freelancers’ incomes account for almost 5 percent of the nation’s entire GDP, which equates to approximately $1 trillion per year from this set of workers alone.
Numbers like these can make becoming a freelancer even more appealing to individuals who are interested in stepping away from their current jobs and going out on their own instead. That is, in addition to the other benefits freelancing provides, such as the ability to work on your schedule (within reason), choosing who you take on as your clients, and having an unlimited income.
But anyone who has ever gone solo to provide services as a freelancer will tell you that succeeding is no easy feat. Many people start with a relentless drive to offer freelance services only to give up a short time later.
What can you do to increase the odds that you will survive as a full-time freelancer and decrease any chance that you’ll eventually have to return to work for someone else, potentially giving up on your dream?
Identify Your Strengths and Weaknesses
One of the biggest mistakes you can make as a freelancer is not understanding where you excel and where you need a bit of work. Knowing these two things will help you create a business that highlights the former and reduces the impact of the latter.
For example, if you know that you’re gifted in people skills, you may find that reaching out to potential customers to sell your services is going to be easy for you. Conversely, if you struggle with organizing, you may find it challenging to keep all of your day-to-day paperwork in order, which is a must if you want your business to survive.
Keep in mind that strengths don’t guarantee success, and weaknesses don’t automatically mean failure. Your only goal in looking at both is to learn what things you will likely be able to handle yourself and which areas you may have to reach out to others for a bit of help.
Remember that just because you’re working as a freelancer doesn’t mean that you can’t hire someone to help design and maintain your website or that you can’t outsource administrative duties. Many freelancers rely on other professionals to help pick up the pieces in areas that they fall short. So, this is perfectly acceptable, preferred even because it enables you to focus on the things you enjoy doing or do well.
Research Your Competition
Knowing your competition is essential anytime you’re in business. Still, it is even more critical as a freelancer because when you’re competing with entire companies that offer similar services, you need to know what you’re against.
The type of service you provide will dictate not only who your competition is, but also how far your search will go geographically. If you are a plumber, for instance, your competition is likely within a specified mile radius. But if you offer online services, your competition can be in another state, if not on another continent completely.
You can find a lot about your competition by only going to their website. While there, take note of:
- The overall layout and design of their website
- What they allow users to do online
- The services they provide
- How much they charge
- Whether they offer any package deals or add-ons
- What phrases they use to attract customers’ attention
- The top 1-3 values they say they offer
Once you have these basics, do a Google search and see what their reviews look like. How many stars do they have? What are people saying are the pros of working with them? What are the cons? It’s also helpful to look at other review sites to see what consumers are saying there as well. Yelp is a big one, but you can also learn a lot from reviews customers post on the business’s Facebook page.
Depending on what type of industry you’re in, there may be additional review sites to consider. For example, if you’re in home design, your competition may have reviews on Angie’s List or Home Advisor. Don’t forget to take a look at these sites as well.
The purpose of doing this type of in-depth research isn’t to overwhelm you or to make you wonder if you can even compete. Instead, its goal is to help you see where other companies may shine and where they fall short. If you can identify the areas where their customers are complaining the most, this gives you something to focus on doing better, thereby attracting more customers and growing your freelance business.
Find Your Niche
Another way to differentiate yourself from your competitors is to find a niche area within your industry where you can stand out. Ideally, this niche will be an area that is relatively untouched market-wise, which is where some of your research will come in handy.
In addition to identifying underserved populations, deciding where you want to niche often involves taking a look at where your skills lie. For instance, if you’re a freelance writer, maybe you write amazing web content but struggle with press releases. In this case, your niche may be somewhere in the online content creation category.
Finding your niche isn’t always easy, especially if you’re new to freelancing, and every ounce of your being is telling you to generalize, so you have a broader customer base. Although this path of action seems like it would make the most sense, it will work against you.
First, if you continuously work on very different projects, each one will take you more time because you’re not able to get better at one given task. Having a niche also allows you to command higher rates.
It’s like with doctors. The Bureau of Labor Statistics reports that family and general practitioners generally earn somewhere around $211,780 per year. Yet, if you specialize in surgery, that median pay increases to $255,110 annually. Over a 30-year career, this is a $1.29 million difference.
Even if you’re not in the medical field, the same theory applies. The more specialized your skills, the more in demand you’ll be by the people who could benefit from your services.
Of course, you don’t want to narrow your niche so much that your customer pool is so small you can’t make enough to survive. But you also don’t want it so big that you’re competing against a lot of bigger fish because it will be that much harder to make a living.
Know (and Capitalize On) What Makes You Unique
Surviving as a freelancer also requires that you know—and can capitalize on—what it is that makes you unique. Put another way, why should someone choose to do business with you versus going with one of your competitors?
Maybe you’re able to complete the work much faster than they are? That would make you unique and would be something you’d want potential customers to know. Or perhaps it’s the quality of your work that puts you heads above the rest. That’s a good selling point as well.
It doesn’t matter so much what your uniqueness is, but more so that you’re able to translate it in a way that makes you more appealing than others in your field. Share this type of information on your website and all of your other marketing materials. Now is not the time to be shy. Now is the time to humbly say why you’re better than everyone else who offers the same things.
Other ways you may be able to stand out include if you have a fantastic story, if you offer green or sustainable services, or if you’re big on giving to charity. Again, take stock of your competitors and find the areas in which you’re different. These are the very things you want to point out.
Brush Up on Your Skills
If you’re just entering the freelance world, you may want to brush up on your skills first, so you’re more competitive in your market. It might involve taking a course to learn more about the services you intend to offer, or it could involve simply practicing your skills a bit more before offering them for pay.
The reason this is so important as a freelancer is, the higher your quality of work, the more repeat customers you will get, and repeat customers are where the money is. When you first start with a client, it takes some time to learn what they like and what they don’t. So, when you can jump right in and deliver, you can finish your projects at a faster rate.
Plus, when you are highly skilled and can deliver, customers are more willing to refer others to you. While making cold calls and reaching out to potential contacts is a normal part of business survival, staying afloat as a freelancer is so much easier when your clients are seeking you out.
Brushing up on your skills also enables you to expand your service offerings. If you’re a graphic designer who focuses solely on web design, for instance, you may find that many of your clients are also looking for someone who can design pamphlets or banners. If this interests you and want more work, you could always learn these new areas. That way, you can be a more full-service freelancer, which is a great way always to have work coming in.
Set Appropriate Rates
Many freelancers struggle when it comes to setting their rates because they want to set them high enough to earn a living, but they don’t want them so high that people aren’t willing to hire them. So, what should you do?
The first step is to see what others are charging in your area or industry. If the rates have a lot of variances, seek to figure out why. Is it because some of your competition is more experienced, or have they simply found a niche market that pays well?
Consider these two basic ways to set your rates. You can charge per hour or by the job. If you’re new to freelancing and unsure how long a particular project will take you, it may be enticing to offer an hourly rate. However, the problem with this approach is, as you get faster at what you do, you begin to earn less.
Charging hourly also opens you up to scrutiny by your client if you don’t complete a job as quickly as they expect, which is why many freelancers choose to charge by the job.
When you have a flat-rate fee, it doesn’t matter how long something takes because you’re getting paid the same amount either way. Flat fees also make it easier to collect portions upfront, such as if you require a 50 percent down payment before starting the job.
Budget for Down Times
Freelancing can be incredibly stressful financially, especially if you’re just starting and used to getting a paycheck like clockwork. When you don’t know for sure when your next payment is coming in, get ready for some sleepless nights.
To help combat this constant state of panic, the budget for lulls in work. When you have a good month, set aside some cash in case the next month is slow. Instead of having a rainy-day fund, set up a household expense fund that is large enough to cover your bills until business picks up.
Ideally, this fund should be in place before you even get into freelancing. That way, you can focus on building and growing your business versus spending all of your energy fretting about how you’ll pay the bills.
Remember Your ‘Why’
Deciding to work in the freelance world almost guarantees that you’ll have moments when you wonder why you ever wanted to go out on your own.
Days like these, it’s helpful to remember your ‘why,’ or the reasons you wanted to take this path in the first place. Does freelancing allow you to attend all of your kid’s sporting events? Or maybe the services you offer are all online, enabling you to travel the world and still bring in some income.
Remembering your whys can help keep you going when times get tough, and all you want to do is give up. Simply go over this list and renew your motivation to keep moving forward because, as any freelancer will tell you, the number one key to surviving in this type of career path is never to give up.