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So as to really grow your freelance business, you must tackle FEWER clients.
It seems counter-intuitive at first. Fewer clients = more revenue and growth? How?
The thing I’ve learned about client services is there may be an allotment of energy you expend servicing each client you might have. You email forwards and backwards, you might have meetings, you spend time working on their projects, etc.
Here’s a list of things I do personally with each client—regardless of the standard level:
- Receive initial inquiry
- Review initial inquiry
- Send qualifying questionnaire
- Review qualifying questionnaire
- Prepare follow-up questions
- Schedule the initial call
- Send a confirmation and agenda setting email
- Prepare for the initial call
- Have the initial call
- Review the decision findings
- Do research
- Write a proposal or create an estimate
- Present the proposal or send the e-mail
- Write a contract
- Send the contract and invoice the client
These are all things done within the onboarding phase—before getting to any of the actual working together—and already you may see how this may occupy your mind and tie up your time.
You’ll be able to, and will, automate as much of this as possible by utilizing editable templates, using contract or invoicing software, reusable email scripts, etc.
Some things can’t be automated and you find yourself spending time on them.
So if you might have to spend time on these tasks, it becomes crucial to select clients that can pay you well to your time. You’re already doing the identical repetitive, (mostly) non-billable tasks, so it is sensible to goal higher paying clients in the event that they are going to take up roughly the identical amount of time and energy from you.
How many consumers are you able to service at any given time?
Depending on the project’s size, I can’t service any greater than 3 clients at a given time. Not if I need the work to be any good. You may give you the option to do more, I don’t know, but what I do know is that you furthermore may have a limit.
After you cross that threshold, the standard of work you may do on your personal starts to drop off and things get sloppy.
Have you ever discovered what that ideal number of clients is for you? It’s price taking the time to determine your capability.
That number is a way to project how much money you may make while still doing good work. And you would like to do good work. Good work brings in referrals to do more good work and helps to create a virtuous cycle that may sustain your online business for years.
So let’s take a scenario of one largish project monthly. That’s twelve large projects per 12 months at a median of three months per project from start to finish.
Now, let’s assume you’re charging a median of $5,000 per project (and for the sake of simplicity you’re getting paid the total sum up front for every project).
$5,000 x 12 = $60,000
Is $60,000 (before taxes) enough?
It may be for some. If that’s the case, great. You don’t need to change anything. But when it’s not, you may take into consideration raising your prices.
Not because you would like to stick it to your clients, but because if you happen to want to have a business that is prospering (and satisfying), you just have to make enough money to support yourself. Sometimes which means letting go of smaller clients so you may pursue larger clients.
So let’s say we raise our prices by 50%. Now we’re at $7,500 for a median project.
$7,500 x 12 = $90,000
Now we’re starting to get somewhere. $90,000 is nothing to sneeze at. You’re that much closer to six figures as a freelancer.
I do know (hypothetically) that if I average one large project monthly at $7,500, I’ll be pulling in a decent wage.
In a perfect world, I’d stagger each project in order that when one is ending up the opposite is starting. And so forth and so forth. So I do know I can service 3 large projects staggered at various stages over a 3-month period.
So now the query becomes how can I sell a $7,500 vs. a $5,000 project? What do I actually have to include within the scope or who do I actually have to be pitching it to for it to sell at the identical rate because the $5,000 project?
Finding answers to these questions and applying what we learn to our business is being strategic. Now we’re putting a more focused effort into our business that’s light years ahead of simply taking up whatever client walks in our door.
That is the way you level-up.
How to increase your rates by 50%
The first query that comes to your mind if you hear that is, “Well, what if I can’t find $7,500 projects?”
It’s a fair query, but if you narrow your focus and say, “I’m only going to tackle projects of a certain size” you begin to do things that can enable you to land those greater projects.
It’s just like the difference between a creative project with no constraints and one with a detailed transient. The project with a detailed transient frees you to work inside those particular limitations.
Any creative who’s ever worked on a project with no creative direction knows how hard it’s. If there aren’t any parameters to work inside, you don’t know where to start and where to end.
The possibilities are infinite, and you’re paralyzed with the paradox of alternative. Yet if you happen to add in constraints (style, audience, project goals, etc.), suddenly it frees you by supplying you with guidelines to work inside. It gives you a direction to aim for.
It’s the identical thing with limiting yourself to a certain size project. I call this my Minimum Engagement Amount (MEA). I ask myself this query, “What’s the smallest size project I’ll work on (in revenue terms)?” The answer to that query gives me my MEA.
Placing this constraint on myself forces me to pursue projects of a certain revenue size or higher.
So when a project comes around with a $2,500 budget, I say no to it since the time spent on that project has a chance cost. I actually have limited capability and filling that seat means potentially giving up $5,000 price of work. That’s the chance cost of taking up that smaller project.
Understanding your opportunity costs
While it’s hard to pass on money that’s staring you within the face (and if you happen to actually need the cash, you must probably take it), what I do when I actually have spare time, or I’ve passed on a low-value project is I reinvest that point saved back into growing my business.
I work ON my business as an alternative of IN my business. What I mean is, I work on long-term planning and business development. For instance:
$175,000 from ONE blog post!
I wrote a blog post back in 2012 that brings in most of my traffic and is how most of my clients find me. Since then, I can probably attribute about $175,000 price of business directly to that 1 blog post. (1 blog post! I believe that’s pretty good ROI for writing one measly little blog post.)
Now, there’s no guarantee that if you happen to write a blog post, you’re going to get that type of return on it, you likely won’t. The point is that I wrote the post during my down time.
Imagine if I used to be too busy to write it because I used to be working with a low-value client and never got around to writing it?
Every project and each client you are taking on have a chance cost related to it.
So ask yourself whether it is price it. Ask yourself if it’s a project you may do good work on. Ask yourself if it pays you a fair wage, and if you happen to’ll like working with this client that you simply are giving up your time for.
If the reply to those query isn’t any and you may in any respect afford to pass on the project, do it.
Working with crappy clients, getting paid lower than you deserve, and doing work you don’t consider in are all signs you would be doing something else to improve your online business and see it repay down the road.
What to do immediately
So how are you going to apply all of this to your freelance business? First, realize you would like to cut off low-value clients so as to scale up. If not today, then in some unspecified time in the future within the near future. Here’s how to professionally fire a client.
With limited capability, you may only tackle so many consumers. If a low-value client is taking on one of your precious seats, it’s like an anchor weighing you down and eating up your time and energy.
After that, put your foot down and create a minimum engagement amount (MEA). Below that number you don’t tackle the client. Soon, you’ll see your online business and revenue reaching new heights. You’ll have less work, more revenue, and thriving business.
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