Fire your Boss! The Successful Home Freelancer's Guide

Setting Up your Home Business

So, you've assessed your personal capabilities, and you've decided that you have a strong potential for success as a freelance consultant working from home. You've also considered the risks inherent in this decision -- both in terms of personal and business risks -- and you feel comfortable that you can manage risks of both kinds. If you're contemplating starting your own consultancy, here are some important actions you might take.

1. Identify existing demand.

Successful businesses provide services that people want and are prepared to pay for -- this is the concept of supply and demand. Demand will result either from providing different services or from providing those services differently. As very few consultants have different products or services, they usually attempt to differentiate their services in other ways, such as targeting niche markets, being increasingly responsive, and so on. One indicator of demand will be that you have potential customers lined up before you start, so that, before making the jump, you can tell existing clients of your plans and secure their continuing support before.

2. Get your networks established.

Abraham Lincoln said, "Good things come to those who wait -- but only that left by those who hustle." Networking is an important means of hustling, so use your existing contacts to make new ones. Hustle at business breakfasts and lunches, industry seminars, and other events conducted by professional associations; have your work published in industry journals or in the local media. Then, when potential clients need the types of services you provide, they will associate your name immediately with their needs. Hustle also in directory listings and Yellow Pages. Try starting a newsletter. Create a website. Even approach former employers. Hustle for work.

3. Get a mentor and a coach.

A mentor will be someone who has succeeded in your field or in another field and who is prepared to nurture your development by taking you under his or her wing, offering guidance and advice. Mentors are role models and valuable sources of advice in such areas as getting started, providing services, finding niche markets, and advertising. Coaching differs from mentoring in that it focuses on providing specific assistance with a specific problem. A coach, for example, may teach you and help you to improve your public presentation skills so that you can, for example, increase demand for your services as a conference speaker.

4. Choose your business name wisely.

Time spent on choosing a company name and logo is time well spent. You'll want a name that helps to distinguish you and your services from the competition -- and one that provides credibility. Do not add "and Associates". In business, "and Associates" often means "small", usually a one-person operation trying to sound big by inventing associates. Register your chosen name with the relevant authority.

5. Establish essential support.

Develop a sound working relationship with those whose support you will need -- for example, an accountant, a banker, and a solicitor. Initially, you may employ part-time accounting or bookkeeping support, seek income protection and other professional insurance, use a graphic designer to design your logo and present your reports and tenders professionally, an office supplier to provide everything from furniture to stationery, and even a fashion consultant to keep you looking the part.

6. Know what it takes.

Being a consultant and being outstanding are two different things. Top consultants possess a bedside manner or a capacity to get along with clients, an ability to diagnose problems and find their solutions, technical expertise and knowledge, communication skills, self-marketing and selling skills, management skills, a willingness to work erratic hours...

7. Ask: "Do I really need that?"

It can be tempting to want at once all the "trimmings" often associated with a successful business -- for example:

• A fancy office. Most consultants go to their clients, not the other way around -- so use technology and save on rentals.
• A bank loan. Some would say that if you can't set up a consultancy without a loan, don't do it.
• Elaborate professional marketing and advertising. You should know your own business best. Keep these experts on tap, but never on top.
• Partners. By joining forces with other consultants you can offer a broader base of skills, target a wider range of market niches, and reduce overheads. Informal partnerships are often preferred.

8. Stay focused on the bottom line.

In the establishment phase of your business, expenses will probably exceed income. Don't panic. Just keep overheads low without skimping. You'll need the best equipment you can afford, but the Mercedes can wait until you're well established.

Golden Rules for Earning from Home

Derryn Heilbuth, author of 'Earning Money from Home', says changes in the job market have resulted in unlimited opportunities for people to work from home. To succeed, however, he recommends that those working form home take the following advice:

• Pick something that maximises your abilities.
• Have fun, because you're unlikely to stick with it if you're bored.
• Do your homework. For every bright idea for a new business, find out who's doing something similar, how crowded the market is and how well others are doing.
• Find a niche.
• Be patient. A start-up enterprise always takes more time and money than expected.
• Take it seriously and others will do so too.
• Keep good financial records.
• Work hard and don't get discouraged -- sticking with something is the reason that small enterprises grow into major companies.

Even with these Golden Rules, you must beware of the common pitfalls for newcomers. Having made the decision to begin your own consultancy, it's vital to be aware of the traps which can bring about your downfall...

• Overcommitting your time. It is easy for a consultant to take on too many commitments and promise too much.
• Missing the boat. Those who miss the waves of change and fail to recognise the trends have to share their business with others or go without.
• Miscalculating the fee structure. Over-the-top fees curb the customer base. Fees that are too low fail to finance the SOHO.
• Giving it away for free. Ideas are the professional currency of the consultant. They are easily stolen.
• Having the wrong attitude. Some consultants have the attitude that they know it all and ride roughshod over the client's ideas.
• Failing to market your services. Hiding in a SOHO does not bring in business. A consultant must be seen and be heard to be hired.
• Being poorly organised. Failure to keep records, send invoices, and poor accounting erodes a business.
• Failing to keep those killer overheads in check. Rent, equipment and staff can unbalance the equation so that costs exceed income.

Reap the Rewards of Working from Home

Increasing numbers of people are working for themselves. In 1996, management guru Peter Drucker predicted that, by 2004, more than half of the working population in the United States would be self-employed. Others, for a variety of reasons, would establish home offices but continue to work for the company from home. Working from home, therefore, will continue to be the preferred option for more and more people.

In starting your freelance consultancy from home, there are a number of specific goals you should work towards and, ultimately, master.

1. Manage yourself.

Your self-motivation, planning, and preparation are the keys to maximising the benefits of working from home. Self-motivation will come from the picture or vision you have for your future -- what you want to become or the way you see yourself operating in, say, five years' time. Planning means translating your vision into actions supported by reasonable time lines. Preparation entails activities leading to the achievement of those plans. You will find plenty of tools to support these three essentials. Your aim will be to find the ones that best suit your operating style.

2. Manage your time.

Dan Sullivan proposes an innovative approach to time management -- Free days, Focus days, and Buffer days. Adopt it, says Sullivan at an AIFP Success Forum, and your productivity will experience exponential growth.

Free days are when you take total time out from what you are doing. This full twenty-four hour period should be free from any work-related information or activities, giving you time to recharge and come up with a fresh perspective on things. Free days become your reward for successful task completion.

Focus days occur on about one hundred days a year and are periods set aside for completion of one or more particular tasks. Sullivan advocates 80% focus on these days, with minimal interruptions. Focus days will be your main fee-generation days.

Buffer days are when you do a little of this and a little of that -- a little free time, a little focus time. Buffer days are essential for focus days to happen. Tasks can be delegated, staff know what is required of them, and you tidy up a myriad issues requiring your attention. (Dan Sullivan, Closing Keynote Presentation, 1996 IAFP Success Forum. )

Others will soon learn your habits associated with free, focus, and buffer time, allowing you to reap the benefits of this simple but effective time-management technique.

3. Overcome feelings of guilt.

Self-discipline is rarely a problem for people working for themselves. Many, however, feel guilty if they are playing a round of golf or engaging in some other form of relaxation when office-workers are heading off to work. Free days, focus days, and buffer days happen according to demand. There is no need to feel guilty if a free day occurs when others are at work. Remember that you have chosen this lifestyle for the added benefits it can provide. One of those benefits may be not having to queue before teeing off.

4. Maintain your business networks.

Make a conscious effort to retain business networks. Continue to attend industry meetings, lunches, and other events that will keep you in the public eye. Use the telephone, fax, and email to maintain regular contact with your clients. Remember those important marketing maxims:

• Talk to every client at least once every 90 days.
• Your telephone will ring only if you make it.
• Don't just sit there: phone someone.

5. Continue to project a high-quality image.

Wherever you are, image remains a key quality. Your personal appearance, the appearance of your office and your stationery, the way your phone is answered, the appearance of your car -- all will be just as vital now as they were before. Working from home may have been a life-quality choice but should not detract from the image you project. The quality of the company you keep will always provide an insight into you and your operations.

6. Become your own best friend.

At times, working from home can leave you feeling a little isolated. Recognition and rewards are most frequently identified as what people miss most of all. Rather than rely on others to provide those essentials, you can use this experience to out-grow the need for continued recognition. Find ways to reward yourself. One example of a reward could be additional free days to celebrate the successful completion of an important project.

Overcoming Isolation

Those who work in the isolation of their own homes often face feelings of loneliness, lack of direction and support, and so on. In some cases, these issues can reduce the consultant's chances of success, and may cause them to return to the daily grind of an office job. Here are five proven isolation-busters, suggested in Optus's Business Advantage 1/2003, which you should plan to address before you embark upon a work-from-home consultancy.

1. Employ the "buddy system".

Choose a friend or colleague who would also benefit from sharing ideas and make a commitment to meet up at least once a fortnight to have a chat about the latest developments in your businesses. You are probably both facing the same challenges, so it is useful to get a different perspective on the way you work. Ask your "buddy" how they deal with isolation, as they might have some ideas you haven't thought of. If it is logistically impossible to meet face-to-face, take the time to chat on the phone or send each other an email.

2. Enrol in a course.

Attending a university, TAFE or college business course is a great way to expand your knowledge base. There can also be some positive networking benefits, as you get to meet with other people to exchange ideas. You may even be able to turn one of your classmates into a customer.

3. Play sport.

Sport is a great way to de-stress after a hectic day's work. Playing a social or competitive team sport will not only provide you with health benefits, but perhaps some unexpected networking opportunities as well. The social atmosphere that sport provides is conducive to making new friends, who in turn could become clients or suitable "buddies" with whom to share business ideas.

4. Work with "the enemy".

It's a natural reaction to consider your competitors "the enemy" and have as little to do with them as possible. However, there may be benefits from networking and acting in a cooperative way to attract customers, particularly in the retail sector. For example, if you are one of four stationery stores within close proximity of each other, you could all work in a united way to promote your suburb as the place for customers to go for all of their stationery needs, providing benefits for all stores.

5. Work with a coach or mentor.

A coach or mentor is an ideal person to talk through the issues your business is facing. They provide you with a sounding board for new ideas and with constructive criticism about the way your company is operating. Being accountable to someone else provides added motivation to get things done, so you are likely to follow through on the initiatives suggested by the coach or mentor. So, if you're a farmer and you've been procrastinating about updating your inventory system, there's a good chance you'll go ahead and do it if your mentor thinks it's worth doing. Best of all, a coach/mentor is someone who takes a genuine interest in what you do.

The Practicalities

The practicalities of setting up a home-based freelance consultancy are fairly detailed. Give some thought to the following basics, as well as to any other considerations that you can identify as being relevant to your own specific situation.

1. Set up your home office.

Spend a few days setting up your home. Doing this now will save countless headaches later. Consider location, access, security, lighting, furniture, storage, image, distractions, and creature comforts. Determine what office equipment you'll need for work and for telecommunicating with clients and colleagues-telephone, answering machine, computer, modem, or some similar device that allows you to connect to other computers and the Internet, printer, fax capabilities (fax software, or a dedicated fax machine), and perhaps a photocopier. Purchase all the office supplies you'll need-paper clips, envelopes, stationery, pens etc.

2. Call a family meeting.

Establish ground rules and discuss expectations. Be flexible, but make it clear that, when you're in your office, you're there to work. Make sure your neighbours and friends know this too.

3. Schedule your day.

Try to discipline yourself to normal working hours, and "go to work" each day, at least until you develop your confidence, and enjoy some success, in your home-based consultancy. Once you become comfortable with your ability to focus, and to achieve, you can begin to experiment with some of the suggestions I've outlined above for optimising your time- and self-management. Since your clients and any colleagues may need to get in touch with you at specific times of day, try to have your schedule coincide, at least to some degree, with theirs.

Finally, to summarize, here are the basic practicalities that you'll need to address in order to give your home-based freelance consultancy the greatest chance of success:

• Set up ground rules with your family.
• Discipline yourself to begin work at a definite time each day and establish office routines, such as checking e-mails first thing each morning, sending out invoices on Fridays, etc.
• Set priorities and deadlines, and stick with them.
• Establish good work habits -- but don't spend too much time at work, or at weekends, simply because your workplace is so close. Balance your life.
• Dress appropriately -- and that doesn't mean getting around in your dressing gown. Productivity relates to how you feel, and look.
• Avoid temptations -- sofa, television, novel, golf, refrigerator.
• Report in to the corporate office at least daily -- to avoid isolation and to keep in contact with colleagues.
• Maintain accurate records of activities and expenses.
• Reward yourself from time to time -- take a walk, play with the dog, water the plants. Take regular breaks or productivity will suffer.
• Seek contact with others -- for lunch or tennis. There's no need to go stir-crazy.

Summary

Many people think that starting a freelance business involves a spare room, a computer, and some good contacts. But if your business is to be successful, you'll need to be able not just to stick out the tough times when those hot leads dry up, but to battle your own feelings of isolation, and lack of motivation. You'll also need to be willing and able to research, assess, and react to your market, control cashflows, and work with clients and contractors.

As we've discussed, numerous factors need to be considered before you embark on setting up your own home-based freelance business or consultancy. You need to assess your own capabilities, devise strategies to anticipate, respond to, and manage risks, and successfully tackle the challenge of setting up a physical office and scheduling your own time. I hope that the pointers I've provided here help you to do all these things and, ultimately, put you in a strong position to make your fledgling freelance consultancy into a great success.