One of the best things about being a freelancer is undoubtedly the freedom you have to make decisions about all areas of your business, from branding and sales to delivery and finance. But with so much to think about, it can be overwhelming at times — particularly if you’re just starting out. Being busy and brimming with ideas is a good thing, but to manage stress and get your thoughts in order, it’s important to take a moment and think about where your business needs to go and what you need to do to take it there.
A business plan is essentially a document that details where you are now and where you want to be in the future. As well as being a chance to put your entrepreneurial vision to paper, it also helps you to keep track of your progress and avoid roadblocks along the way.
While a business plan may not be necessary for all freelance jobs (a freelance designer whose work is their hobby with no plan to grow, for example), a well-thought-out and structured business plan can add tremendous value. Here are just some of the things it can help with:
The good news is that unlike with a traditional business plan where various departments need to give their approval before things can move forward since you are in the driving seat, your freelance business plan can be far more flexible.
Unless you intend to use your business plan to seek funding from investors, it’s unlikely that you will need a 20-page, structured business plan. Make things easy for yourself by keeping them as short and simple as possible.
Since the work environment for a lot of freelancers tends to be dynamic, we also recommend not planning too far in advance. Start with a business plan of between 3-6 months and reassess when you get to that point.
Before even putting pen to paper, consider the needs of your business and what you want to achieve through this plan. Although most business plans follow a traditional written structure, as mentioned above, if you don’t intend to seek funding, you might decide to take a more visual approach. A vision board, for example, is a great way to chart your plan for the year using images related to projects. You could also include images of the rewards you’ll get for completing them as extra motivation. A holiday to Mauritius, perhaps? (We can dream).
Even if you don’t decide to go with a visual business plan, taking a big-picture view of your life will help you to clarify what you want and then build the plan around that to make it happen. Some questions you might want to consider at this stage include:
Before you dive too far into the future, now’s the time to start compiling information about your business. For starters, what exactly is your business? Does it operate under a registered name, or do you work solely under your own name?
This section of your business plan is also a good place to state your target market (if applicable). If you’re not sure exactly what that looks like, a user persona exercise can be a good starting point.
The next thing to consider is the products and services your business offers. For example, do you work on a project basis with the scope defined by the client, or do you offer your own products or packages? What exactly does that look like?
How about competitors? Think about not only who provides similar products and services to you, but who also helps your target audience solve the same problem. Bear in mind that often, competitors are from different industries.
You may well decide to have a separate marketing plan, but it’s also something worth incorporating into your business plan. What are you doing to communicate with customers, and how do you plan to reach new ones? Perhaps you plan to focus a lot of your efforts on social media, or send out a weekly newsletter? Have you thought about running events or meet-ups?
Some questions to consider for this section:
Now it’s time to decide what the future holds. Everyone wants their business to grow, but think about where exactly you want your business to be five years from now. The more specific your goals are, the better you can tailor your plan to meet them.
Begin by making a list of your goals such as how much income you want to bring in each year, how many clients you want to reach, and whether you have plans to take on additional staff. Of course, non-monetary goals are also important to keep in mind. For example, are there any new skills you hope to develop?
Questions to consider:
Now it’s time to think about how you will reach the milestones mentioned above. Some will be things you can achieve relatively quickly, while others will be longer-term. Having a weekly planner can help you break them down into smaller goals which you can refine as needed. Unless you intend to share this plan with investors, don’t worry about being too ambitious with your goals. Sometimes, thinking big can actually motivate you to work harder.
When assessing financial targets, keep in mind how much you will need to charge to reach those goals. Will you need more clients? If, on the other hand, one of your main goals is to have more free time, can you revise your client list? Are there any tasks you could spend more or less time on?
As a freelancer, it’s easy to get caught in the trap that all the money you make is your own, but as tempting, as it may be, don’t make the mistake of neglecting your taxes! Pay yourself a monthly ‘salary’ and leave the rest in your business account. You’ll thank yourself later!
Questions could be:
Struggling to keep on top of your freelance workload? Read our post on how to improve your time management.
by Emma Gibbins | 24 Jan 22