Posted in MicroBusiness Musings, Starting Out as a Freelance Consultant, General Freelance Info at 4:30 am by andy

In my city there are literally hundreds of web design firms.  How do I figure out which ones are my competition?

Because barriers-to-entry are almost non-existent (”I have Photoshop and will design for food”), almost everyone is your competition… and yet few really are.

Instead of focusing on individual firms as your competition, what you should do is step back and analyze your competition as a set of distinct groups: large agencies, small agencies, local freelancers, overseas freelancers, in-house employees. Each has a business proposition for your potential clients. How do you stack up against each group? What do you bring to the table that will be unique? For which types of clients do you not match up well and does that reasonably rule out targeting that type of client? Where do you blow the competition away?

Example: for my consulting firm, I directly compete with small agencies, local freelancers, and overseas freelancers for all of my clients. I do not match-up well with the other groups, so I don’t bother competing against them. I’m less expensive and more responsive than small agencies; I’m better able to handle larger projects than most local freelancers. I’m local and speak the local language, so overseas freelancers are the least likely competition for me.

If you market your business across the world, overseas freelancers will provide more competition, since you’re entering their markets as well as they’re trying to enter your market.

Once you start this level of analysis of your business, it becomes easier to figure out which marketing messages will be important and how to deliver them in the most effective way.

For freelancers just starting out, though, most likely you are more focused on landing clients — any clients! — and that’s smart.  Your biggest business threat when you first start out is your own cash flow issues: most businesses fail in the first year because they run out of cash.  If you focus on landing clients that will pay you well for the job you do and return regularly to have you do more work, you will position yourself to succeed while your competition fails.

Posted in MicroBusiness Musings, Starting Out as a Freelance Consultant, General Freelance Info at 6:37 am by andy

Economic downturns usually mean more work for freelancers, since your customers need to do more with fewer salaries on the books, so extra money is usually available for subcontractors to help out.

Although there will be more business for freelancers, having more people out of work increases the pool of potential “freelancers”.  What to do to separate yourself from the rest of the crowd?

1. Learn how to turn every new client into a repeat client.  If you spent all that time landing the client in the first place, you want to get more than one project out of them, because every subsequent project will have a higher profit margin.
2. Make sure you are offering services and/or products that are important to the financial well-being of your clients.  Whether you are helping them improve their top line or their bottom line, make sure you focus your products/services in a way that does one or the other in an obvious way.
3. The biggest and easiest differentiator that a freelancer has is personalized service.  Anyone can get disinterested customer service.  If you provide awesome customer service, you will stand out from the crowd.  Don’t make price your differentiator unless you have a serious plan to continually increase volume while decreasing your prices further.

Posted in MicroBusiness Musings, General Freelance Info at 7:21 pm by andy

As a freelancer, we get to decide what our benefits package will look like. Often, though, we’d rather not think in those terms and instead just focus on whether we’re raking in the cash.

Bad things happen, though.  Many corporations provide you with ways to protect your income and your family’s finances in case something bad happens to you while you’re employed.  But being the business owner means you have to take ownership of this side of your finances.

What happens if you get hit by a car and end up in the hospital for a month and then need another 6 months of physical therapy before you can sit at a keyboard and work again?  How about you contract a tropical disease on one of your frequent vacations to the islands and can’t work for a year while you recover your strength?  That would be pretty devastating to your finances, huh? Read more…

Posted in MicroBusiness Musings, Starting Out as a Freelance Consultant, General Freelance Info at 7:59 pm by andy

What should I charge for subcontracting to an agency?  Do I need to discount my time?

I’ve had many different roles in my career, from employee to manager to owner.  Here’s what I found about rates:

• As a consultant, your employer wants to bill you for at least 3 times your salary on a per-hour basis.  If you make $100K, they want to bill you at $150/hr and so on.  Some industries actually look for a higher return — e.g., SAP consultants – because they may not be able to book you full time, but 3x is a good rule of thumb.

Read more…

Posted in MicroBusiness Musings at 2:59 pm by andy

My previous post was on what to do before disaster strikes.  Part of my disaster recovery plan is to make sure all project work is backed up off-site in an online repository.  I’ve been using Iron Mountain’s connected.com for the past 6 years, but I was starting to wonder about the competition, so I researched them, tested them, and here’s what I found:

 MOZY: Owned by EMC Corp now, these guys have a great pricing structure, free for up to 2 GB or ”unlimited” for $4.95/month if you pick MozyHome, but if you go the Pro route for business use, it’s $3.95 per month for the account and $0.50/GB for storage.  Retention policy is to keep everything that has changed for the past 30 days; after something is 30 days old, if there’s a newer version, it’s deleted from storage. Read more…

Posted in MicroBusiness Musings, General Freelance Info at 8:37 pm by andy

Most people wait until after they have a disaster to think about a decent backup strategy.  Considering the cost of permanently losing your work — both the time lost and the money spent recovering what you can recover — you’d think people would be a bit more proactive about this… but I suppose that a disaster is a great teacher.

So what kind of backup strategy should you have?

Start with this assumption: your work space is going to be leveled one day by a fire/flood/earthquake/hurricane/tornado/iceberg.  Or your computers are going to get stolen.  You want to be able to recover from this in a reasonable amount of time (say, a week, since you’ll need to get new hardware).

Second assumption: you are going to change files regularly throughout the day and want to back those files up at least once a day.

Third assumption: if you have a project-level screw-up, you want to be able to recover any files you lose within a few minutes. Read more…

Posted in MicroBusiness Musings, Starting Out as a Freelance Consultant, Marketing Your Freelance Consultancy at 5:13 am by andy

Are you a “WE” or are you an “I”?  As a freelancer, do you represent yourself to clients as something larger than yourself?

Some freelancers consider it “dishonest” to represent themselves as being an entity larger than one person.  They figure that the client can see through your BS and see that you’re a “one man band”.

My view is that you present yourself the way you want your client to see you.  Read more…

Posted in MicroBusiness Musings, FreelanceLocalTech Chronicles at 8:58 pm by andy

I first started using Google Adwords to promote my consulting business back in September 2003.  At that point, the choices were limited: keywords for search and for content.  No site keywords, no separate bids for content keywords compared to search keywords unless you set up separate campaigns.  I tried content search for about two months and racked up about $600 in unnecessary expenses and got nothing from it but a lot of clicks from people on a lot of strange sites.

So I turned off content ads.  Kept the search ads.  At that point, spent about $100-$120 per month.  Added about 3 new customers per year through it, which was enough to keep me busier than I had been in years.  All was (and still is) good.

As part of FreelanceLocalTech marketing, we have been really experimenting with all the different Adwords features and I’m definitely impressed with what Google has recently added to help make content ads more useful.  Read more…