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Working Freelance

By Fran Quittel
Special to washingtonpost.com
Wednesday, April 22, 1998

Perhaps you're sitting at your desk right now – soon to head to yet another tedious roundtable discussion on the latest paradigm on parade – dreaming of going the solo route and becoming your own manager. Visions of freelancing dance in your head: you get to do something creative, fulfilling, and intellectually stimulating at a price and time you set. Well, that's the dream anyway.

Whereas Washington's entrepreneurial support network – with Potomac KnowledgeWay's Netpreneur Exchange in the forefront – is making freelancing an increasingly viable option for many professionals, the chaotic and uncertain life of a freelancer is not for everyone. Read on to see if you are equipped to go the solo route.

The Critical Issues

Before you break out of that cube, be sure you've researched these three issues:

1. The Market.
You should start by gauging the demand for your services and then price your services accordingly. Accountant, recruiter, technical writer, Web site designer, and public relations consultant are all professions that lend themselves to freelancing. Begin by searching our jobs database to see what skills are most in demand.

Then, check the Bureau of Labor Statistics' Occupational Outlook Handbook site to see if the prediction for your selected skill set is rosy enough to give you profits well into the future. For example, the outlook for technical writers is great through the year 2006, but if you plan to go into broadcasting, you face stiff competition in the nation's big cities. Make sure you have unique qualifications to offer that differentiate you from the competition.

Research the market and consult your colleagues to gauge going rates. For example, if you're a computer consultant you should look up your profile on Janet Ruhl's Real Rates Survey site to see what others with your skills in your geographical area are making. For example, on a visit to the site at the end of March median rates ranged from $50 an hour for COBOL programmers to $120 an hour for specialists in the high-end package, PeopleSoft.

2. The Work culture.

Tips From Other
Brave Souls
Prepare yourself for the roller coaster ahead with Joel Raphael's account of the ups and downs.

Freelancing can mean long hours cooped up in your home office. Slipping on your koala slippers and sashaying down to the cellar office might sound idyllic now, but solitude can be stifling for many people. You should expect an uneven work flow. Make sure you are prepared for the possibility of extended periods of down time. Freelancers agree that working independently can be a quick trip to euphoria when you get a great new assignment or a prelude to Prozac when your worst financial fears are realized. So, stock your medicine cabinet accordingly.

3. The IRS.
Especially if you are embarking on technical- or computer-related freelance consulting, the IRS may have strict requirements regarding how you establish relationships with your clients. In the last few years they've been cracking down on freelancers who look like full-time employees, so make sure you are prepared to answer to the tax collector. Understand the tax ramifications of incorporating yourself.

Ready, yet? Full of Questions?

Here are some of the most frequently asked questions by those flirting with the idea of freelancing – peppered with genuine sagas of freelancer follies.

Q: How do I get started?

Tips From Other
Brave Souls
David Lawrence relates how he turned his voice talent into a profitable freelancing business.

A: Typically a freelancer will begin as a budding entrepreneur with a good first assignment that launches the business. Ideally that first assignment should provide more than just cash flow. It should:

commit to a contract for your services over a period of several months or a year, during which you can develop other new business.

showcase your talent for a client well-respected in the field and whose opinion will count.

expand your access to knowledge, resources, and tools of your trade – such as new programming applications – that would be of potential value as you build your business.

Q: Where is my best source for new business?

Tips From Other
Brave Souls
Build your business with Joel Raphael's tips on forming ties that pay off.

A: The best new business comes from referrals – from people to whom you've shown yourself as someone who can add value in a situation. Referred by someone whose opinion is respected, you become a known quantity who can deliver reliable results.

Q: Should I team up with someone?

Tips From Other
Brave Souls
Robert Griendling explains how choosing good partners is essential to expanding your business.

A: Identify your business weakness and partner accordingly. If you're not a good marketer, find one. Early on you should consider adding an advisor to systematically review your business processes every quarter or six months. Once you are in business for yourself, it is critical to analyze where you are making your money and to concentrate on shopping those skills and dropping the tasks that take you too long to complete. Perhaps farm those time-consuming tasks off to your partner.

Q: What are the biggest risks of freelancing?

A: The risks are not having enough business, watching your expenses exceed your income, letting solitude destroy your discipline, and turning into a bill collector full-time. When you build proposals, be sure you understand your costs. Have you correctly figured in the number of hours it will take to complete a project, the unknown variables, and the long-distance phone bills? Try to set deadlines for project completion and stick to them. Make sure the terms of payment are clear to the client before you begin work.

Q: What should my exit strategy be?

A: You can always return to the force. Once you have been out there taking responsibility, making decisions, and being accountable to the bottom line, you may well find an opportunity to move back into a company and assume a leadership role that you might not have achieved otherwise. As long as you are expanding your skills, working in leading-edge areas in accountable ways, you may find that freelancing – while not without risk and obstacles – has advanced your career.

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