Freelance Consulting Advice

Conventional wisdom says we should improve our weaknesses.  Why, so we end up with slightly “less weak” weaknesses?  Screw that, I say play to your strengths!

We’re all naturally good at some things and not others.  And by that I don’t mean just those things for which we have aptitude, but also things that we enjoy doing and that actually give us energy.

I remember when I was a hard-core coder, putting in a 20 hour day was easy because I was so into it.  The idea of coding for 20 hours a day now gives me palpitations.  But the idea of launching a business and paying someone else to do the coding excites me, even if it still means I’m putting in 20 hours a day.

On the other hand, improving our weaknesses is often a waste of time.  We may get a little better at some things, but often with an associated opportunity cost.  And we probably still won’t enjoy those things.  We’re far more productive when we play to our strengths.

Playing to your strengths makes you more effective

Today, more than ever before, we can outsource absolutely anything.  Does it make sense for you to struggle with your taxes, for example, when it will not only take you five times as long as an accountant, but also take away from what you’re good at doing?  I don’t think so.

Granted, we don’t always have the luxury of getting other people to do the work we’re not good at or don’t enjoy.  Even so, we should then spend the minimum amount of time necessary to do that work, and get back to playing to our strengths.  Only this way will we be more effective and become more successful so that we can eventually outsource the other stuff.

Look at highly successful people in any area of life – from entrepreneurs to athletes to artists – and more often than not, they would have devoted their lives to developing their natural strengths.

That’s not to say you shouldn’t be learning new things and improving yourself.  I constantly have 2 or 3 books I’m in the middle of reading.  I love reading and improving myself, as long as it’s related to things I enjoy or that excite me.

Playing to Your Strengths as a Freelance Consultant

So how does all this relate to freelance consultants?  A while back I wrote a post, Why Should I Hire You?, where I talk about the importance of narrowing your focus and not just taking on any work you can get.

To expand on that idea, you should focus on your strengths.  Become an expert in your field playing to your strengths, and not only will you get better and better, but you’ll also love every minute of it!

Cheers
Dino

As a freelance consultant, you chose to work for yourself, but that doesn’t mean you have to work by yourself.

We all know it can be lonely as a freelance consultant, especially if you work from home a lot.  That’s why you’ll often find us at (free wifi enabled) coffee shops – so we can work and be around other people.  Or we’ll organise meetups, where groups of freelancers can discuss common issues and problems, share ideas, or just socialise.

Or maybe you need a professional meeting place to take clients, but the idea (and cost) of a serviced office doesn’t thrill you.

Welcome to coworking!

What is Coworking?

At it’s core, coworking provides a place to work – that usually means desks, an Internet connection, and coffee, plus meeting rooms and a common/lounge area.  A coworking space is where freelancers, start-up’s and other independent workers can come together in a shared office.  But it’s much more than that.

What are the Benefits of Coworking?

I believe coworking is an excellent example of the saying “the whole is greater than the sum of its parts”.  It’s the collaboration and sense of community that differentiates it from other office environments.  What you get is a knowledge pool made up of people from various fields all willing to share, and that allows for the cross-pollination of ideas.

Not to mention it’s very handy to be able to bounce an idea off someone for a quick sanity check.  Add to that regular social and educational events, and often even access to experienced mentors, and the value to members is huge.

Oh, and I almost forgot to mention that membership usually costs a fraction of what you would pay to rent an office or use a serviced office, and you can come and go as you please.

More Information

For more information on coworking, start here.  Coworking is growing in popularity with new spaces regularly popping up all over the world.  To find your nearest space have a look here or try this iPhone app.

I’m such a big believer in coworking that I plan to open a space here in Perth, Western Australia very soon.  I’d love to hear about your experiences with coworking.

Cheers
Dino

Don’t worry – I’m not trying to sell you anything.  Just emphasising the importance of action.

A while ago I wrote a post about planning, where I said that you don’t have to plan in order to be successful, but you increase the risk of failure massively if you don’t, especially when starting (and running) a business.

While that advice stands, what is even more important is action.  Not planning is usually a bad idea, but not acting always means certain failure.  Planning without action is not just useless, it’s worse than useless, because of the opportunity cost.

Unfortunately, it seems that for most people it’s easier to plan than to act.  And as I said in Mindset & Fear, fear is probably the number one reason most people don’t take action.  And that fear is usually fear of failure.  The funny thing is though, the only real cure for fear is action.  And the only real failure is the failure to act.

So how do you conquer the fear?  One way is to imagine your future 5 or 10 years from now, as vividly as possible.  If you stay in your comfort zone and don’t take action, what does it look like?  Will you look back and be happy about not taking action now, or will you regret it?  And if you do act, what’s the worst that could possibly happen?  You might look foolish, or lose some money.  Would that be the end of the world?  I don’t think so.

On the flipside, what do you stand to gain by taking action?  Who knows.  That’s part of what makes it exciting.  Do you think any successful person knew where they would end up when they took their first step?  Of course not.  They might have had a vision, and no doubt had ambition, but you can never know for sure how things will work out.  Unless you do nothing, in which nothing will change.

One thing I find telling is that every single freelancer and entrepreneur I speak with, despite their differences and widely varied stories, all have something in common: they all wished they had started sooner.  And by started they mean by taking action sooner.

The author of My Start-Up Life, Ben Casnocha, figured out at a very young age that talk is cheap.  My favourite quote from his book is: “I have a strategic plan. It’s called ‘doing things’… In the early days of any new business, it’s easier to plan than to act. It’s easier to strategize than to actually do stuff.”

So if you have an idea you’re not pursuing, or you’re sick of your job but afraid to become a freelance consultant, I say to you “take action!”  Even just a small step, because the beauty of action is that it has momentum.  Even small steps will build that momentum.  And even if things don’t work out the way you had hoped, you will still have learned a lot, and you can use that knowledge to do better on your next venture!

Cheers
Dino

Cash flow is the lifeblood of any business, and therefore cash flow management is absolutely critical.  Why?  Because having enough cash at the right time is crucial.  This is one of the main reasons businesses fail.  You could have the best product or service in the world, with happy customers and plenty of sales, but if you run out of cash, none of that will matter.  If you can’t pay your bills on time you will go out of business.  And I speak from personal experience here – it almost ended my freelance career a couple of times during my first 18 months.

Don’t be put off by what I’ve just said.  Just because it’s important, doesn’t mean cash flow management is difficult.  The problem is that a lot of freelancers don’t do it at all – until it’s too late.

And it’s particularly important for freelancers, because for a lot of freelancers (myself included), income is relatively unpredictable or “lumpy”.  If you work on a project basis, it can be weeks or even months between pay days, and that can make it difficult to plan ahead.  But plan ahead you must.

Forecasting Cash Flow

Forecast and forecast often!  That is the number one tip I can give you.  Why?  Because if you can see your cash running out ahead of time you can do something about it.  I generally plan for the next three months, but focus on the month ahead, with a little advance planning beyond three months.  Even though you can’t be sure of everything you’ll need to pay and when (it’s always more than you think), or everything you’ll receive and when (it’s always later than you think), do the best you can with the information you have.  Overestimate expenses and underestimate income.

Show Me The Money!

Take partial payments up front – this should be detailed in all agreements with your clients.  And invoice immediately upon completing each job.  Remind clients of upcoming due dates, and always follow up overdue invoices right away.  Don’t buy stuff you don’t need, don’t spend money before it’s in your account, and always save a percentage of your income to help when money is tight.

For some common terms and examples, see Wikipedia’s definition of cash flow.

Coming Up

In part 2 of this post I’ll go into more detail, share some more cash flow management tips, and provide a sample worksheet to help with your forecasting.

Cheers
Dino