Estimates say that the number of freelancers entering the marketplace is growing at a compound annual growth rate of 15%. Enterprise company layoffs and the demand for more flexibility after the pandemic are two of many reasons that more people are considering freelancing. If you're ready to hang out your shingle, you definitely want to make sure you're on steady ground, so preparation and planning are necessary.
Here are 5 steps to consider when starting your own freelance business.
Examine Your Experience
Many entrepreneurs have years of experience in varying industries or specialties. Freelance demand, however, tends to run more specialized. Examine your job history and experience and determine if there's a specialty that appeals to you. You may decide that you'd like more hands-on experience or training before you go out on your own as a freelancer.
Analyze The Industry
It's important to understand how much will be expected of you as a freelancer. Scrutinize the industry that you will work in and determine if you will need to work long hours or depend on large projects. You may find that your freelance career starts as a side hustle that requires dedication to growth before taking it full-time. Or you may find that the industry demand will support exactly what you plan to do.
Consider Your Financial Situation
Analysis of the industry will also determine how much you can charge for your freelance work. While this information is valuable, your overall financial situation must be considered. It makes sense to save part of your full-time salary for those lean months at the beginning or later on. Or you might consider taking out a business loan or some other financing. Starting a business is stressful enough without running out of money along the way.
Expand Your Network
If you know other freelancers who are in your industry or industry-adjacent, don't be afraid to reach out to them. They may offer advice or suggestions, or ideas you hadn't considered. Connect with others over social media or network at industry events in person. One of the strongest ways to build your confidence and gain clients is to make a concerted effort to expand your network.
Define Your Goals
Your goals will change as your business grows, but you must start somewhere. Consider the following questions:
- What is your why?
- Are you freelancing to earn extra income, or do you want it to be your primary income?
- Is your primary motivation to be your own boss or gain more personal freedom?
- Do you eventually want to grow your freelance career into a business and hire more people?
Next, set achievable and measurable goals for your freelance business, such as when you expect to have a certain number of clients or a particular amount in revenue or a date to quit your full-time job. Then check back in a re-define your goals on a quarterly or annual basis as you gain more experience and grow your business.
Overall, these best practices will set a solid foundation from which to start your freelance business. The next steps would be to determine how to market yourself and find the right clients that are the perfect fit. Good luck!