I was happily working away, managing an increasing number of bids and proposals, when the call came. Our win rate had soared from about 1:12 to better than 1:3. Morale in the team was high. Other people in the company sought to join this high performing area of the business. The work was hard, but we were motivated and, in the main, having fun.
The basis of the call was that we were the only part of this international department that was providing good results. In every other geography, results were poor. So, those in the ivory tower had decided to disband the department worldwide! I could take redundancy or go back into one of the operating companies as a solo bid manager/writer. For me, the choice was not an easy one. Do I accept what was in effect a demotion and a pay cut, but stay with a salary and a pension? Or do I leap into a new world, on my own and not knowing where I would land? I chose the latter. It was the best decision I have ever made.
I should have made the jump years before, but my false sense of security as an employee had stopped me. Had I known then what I know now, things would have been very different. However, on the way I learned a few points which you may find helpful if you are looking at such a change.
Before I made the choice to leave, there were a few things going for me which made everything easier. Firstly, I had a redundancy package. This gave me the money to get established in my new situation. Next, I was able to work my relationships in the current business and set up a six-month contract for me to deliver my services back to it, once I had left. The company got me at a ‘cheap’ rate, and I had some financial security above my redundancy money. This was a very big plus.
The next thing I did was to find an accountant who knew the game for freelancers and contractors. He advised me to set up my own company, which I did. This cost surprisingly little but paved the way for me to improve my income from then on. He advised me that I needed to have my own equipment (computer, phone, etc) and plan on working with several clients. If I did this, I would not fall foul of the dreaded IR35 tax rules (the Government’s way of ensuring people claiming to be contractors are not in fact “disguised employees”, who claim to be contractors in order to save paying their tax). I needed to look for more contracts.
The day I left paid employment was bittersweet. Of course, I was full of doubts and fears but I was looking forward to the freedoms. I was given the redundancy cheque and a leaving do. Then, after a week’s break, I turned up again as an independent contractor!
I was an outsider. It was odd not to be part of the water-cooler intrigue any more. However, I found I was able to get more done in the working day and not carry the internal office ‘baggage’ home at night. I was able to come and go as I wanted, within reason. No one was micro-managing what I was doing.
It took some while for me to come to terms with the altered relationships with my ex co-workers. But it did not take long for me to work out that much of what had been going on in the workplace had been political and not actually contributing to meeting a client’s needs.
I found out that I could deliver more than when I was employed. However, I needed to deliver more and not just do a ‘good’ job. I had to do an excellent job, every time. The downside of this was that, sometimes, I had to do more work than I had planned without getting paid. If I had set an expectation with my client of what I would achieve, then meeting that expectation was more important than getting financially rewarded if I wanted the next job.
Although I had a few months of a relatively low paid contract, I was worried about what would come next. After all, I had a family and a mortgage to support. Luckily, I was given some good advice. Another contractor, who ended up working beside me, told me to do two things. Firstly, decide very clearly what I wanted to do. I needed to consider:
- What sort of work did other people think I was particularly good at?
- What sort of work did I most enjoy?
- How could I put the two together to create an ‘Experience Statement’ which would demonstrate these to other people?
This was not easy, and I had several attempts before I was happy. After all, if I was professing to be good at bids, a lacklustre document was not acceptable.
Then, he advised me to register with one (and a maximum of two) contractor agencies which specialised in my type of work. He said it was important to make friends with the person who handling my skill set and do whatever I could to help them do their job. As I found out, the relationship you create with the agency helps you to be considered first when suitable work turns up. You should not register with every agency you can find, as you will just become ‘CV fodder’. They will have no reason to promote you for an opportunity over their ‘favourites’.
Pricing Your Services
Working out what to charge was my biggest concern. The agencies gave me some guidance about what other people were charging and what clients were paying. However, I had no track record to prove my value.
I was faced with setting a low rate and then having expectations set for future work at this level. Or, starting with the same rate as others and not getting work because I had no track record. In the end I decided to market myself on quality and not price. So, I spent even more time making my CV look fabulous.
Of course, my ex-employer did not pay this day rate. I had to take the hit just to give me a working track record, but I now had the start of a contractor work history and time to look for the next contract.
Since then I have tried to price myself slightly higher than others. I do this on the basis that:
- If you price your time at a low level, you will end up working with team leaders. You won’t get any senior attention in your client’s business. This means it is very difficult to get things done. So, the client’s perspective will be that you are doing an adequate job, at best.
- If you price your time high, you will get the attention of more senior people and they unblock access to the information and people you need to do a good job. They will listen to your recommendations and lead the implementation. You will achieve more and the work will be more interesting. Overall, they get better results and better value for money from employing you. However, failure to meet expectations would be disastrous so you need to be very careful about the opportunities you take on. You must deliver value for money.
- On a practical level, if you work five days a week at £200 per day, you can make a living (if you work full time). Alternatively, if you work one day a week at £1,000 per day, you have the same income. However, you have 4 days in which to look for the next bit of work (or to enjoy your life). Plus, you get more interesting assignments. Moreover, you might work more than one day per week!
These days I tend to look at a job and give a single, fixed price for the work based on my relatively high rate. Often, I end up working more days than I originally planned but I have found that, over time, it all works out. Plus, clients like the certainty of fixed pricing.
The Work Life Balance
The biggest plus of the jump for me was the ability to work when I wanted to and manage my own time. So much so that now I could never go back to working as an employee. All I have to do is balance the days I am engaged in paid-for work with my social and family life. There are times I have to work because I need the money and times when I turn work away because I have better things to do with my time. When I get the work I want, I can often choose to work in the evening or late at night. I can spend the day doing something else if I prefer. So long as I meet my commitments and I exceed the expectation of my clients, I can do what I want. The freedom is the greatest benefit and has enriched my life immeasurably. And if you are happy and relaxed, somehow the better and higher paying jobs seem to come through to you, too.
My Lessons Learnt
If you are considering ‘going freelance’, my recommendation is to do it and do it now! Yes, it is riskier – but not that much riskier. In my experience, the financial and personal benefits easily outweigh the disadvantages. Below are a few key points I have discovered:
- Make sure you know, very clearly, the types of work you want to do. Write them down and then create a CV and Experience Statement that shows how good you are at them. Add testimonials and awards, if you have them.
- You need to try and plan your first six months whilst you are still in paid employment. This will give you the ‘breathing space’ to set up your future.
- Find an accountant before you start, who understands the freelance and contractor environment. Take their advice. Setting up your financial and tax affairs now will save you a great deal of money as you go on.
- Use a reputable agency and become a friend to the individual in that business who looks after your skill set. Help them do their job. Talk to them often (and not just when your current contract is ending).
- Talk to them all (and anyone else who can help) about what rate you should charge. Set a moderately high rate (which will telegraph to a potential employer how good you are) and then be prepared to do more work than the planned days (to make you look good).
- Plan time to market your skills as part of your work schedule. Accept that this will be unpaid, but essential.
I wish you the best of luck – but don’t forget, you make your own luck!
This article was written by Andy Haigh.