What freelancers MUST focus on

I came across an article on freelancing the other day which I felt didn't tell the true story when it came to helping freelancers establish and grow their businesses. One of the major themes I'm working on at the moment is to help the freelancing movement become more business minded. That doesn't mean to turn freelancers into a business because many do not want that - rather I want freelancers to be able to establish a business framework around their practices so that the way they operate is more efficient and effective. The benefit of this hopefully is that they will be able to focus more time on their actual work with greater success!

I've listed below 3 key things that freelancers must consider when it comes to improving their practices;

1. Move past your motivations and onto your competencies

Everyone talks about motivations and that they must be positive rather than negative. That may be true to a point but the one thing many freelancers do not do, or have a lot of experience in doing, is considering their capability to become a successful freelancer. Many freelancers that I know are experts in their chosen professions and produce high quality work. However that quality makes them perfect to be an outstanding employee - not a successful freelancer.

You must think about positioning yourself, just as a business must, and that means you have to undertake a personal assessment of yourself, at both the personal and professional level, and how that stacks up against the requirements of a successful freelancing practice. If there are 10-12 key competencies required of a freelancer and you assess yourself as having 4 or 5 that gives you the knowledge to act to either improve yourself or delegate what is necessary before taking your business forward. Otherwise, just like poor business planning, lack of preparation will hurt your ability to succeed.

2. Risk management of your business

I read in an article that there is no scientific way to assess whether it is a good time to go freelance - you just need to feel it in your blood. Now, having come from a professional environment I disagree with this statement in a big way. Scientific, perhaps not, but there are ways to assess your ability to freelance and there are ways to mitigate the major risks to your freelancing success. There is a common business planning tool called a SWOT analysis that makes you (and if you want to consult others) on your Strengths, Weaknesses, Opportunities and Threats. Risk management is also about research so you need to perform analysis on the state of your market eg. call recruiters, read blogs and forums, speak with local businesses - basically look at all the people who may hire you and take note of what they say.

Another thing you can do to minimize risk is in Point 1 above - know your areas of strength and weakness. Risk minimization is all about looking at the key things that might hurt your business from the perspective of, for example, your ability, market demand, competition, operational inefficiency, inadequate IT capability, location etc. This should be part of your initial planning.

3. Setting rates

This is definitely an area where freelancers need and I would predict really want to improve. Whilst you need to check what others are charging this is only one thing you need to be doing. You also need to be finding out what it is client's value when it comes to your area of expertise - you also need to make sure you are earning what you want to meet your needs. Agencies and clients are not going to pay you great rates unless you offer something special - they are not on your side and pretty much see you as a resource. Don't stop at find out what others charge - you need to go and find out why they charge a particular amount, you need to know the minimum of what you need to charge considering your life situation and you also need to look at ways to repackage and position yourself to produce additional income streams and value.

Freelancers have to stop thinking of themselves as earning only via time and materials and that cheaper is better or they need to charge just what the market is charging. It's time for freelancers to step up and really start to control their earnings capabilities.