As a freelancer, the first thing you need to do is regard yourself as a small business. No, you don’t run a small business. You are the business. That is, you’re not just a freelancer specializing in your particular trade (say writing), but you are your personal brand’s accounting, marketing, HR, IT, and R&D departments.
In other words, you are an entrepreneur going lone wolf ─ a “solopreneur” ─ the smallest of small businesses. It kind of has a nice ring to it, doesn’t it?
Well, small business success statistics won’t sound as good. You see, small businesses have a tendency to fail. For instance, of all small businesses started in 2014:
- 80 percent made it to the second year (2015);
- 70 percent made it to the third year (2016);
- 62 percent made it to the fourth year (2017);
- 56 percent made it to the fifth year (2018).
Furthermore, 82 percent of businesses that fail do so because of cash flow problems. You, being the smallest of small businesses, are awfully susceptible to succumb to cash flow quandaries. So, while you strive to bag more and more clients to keep the work and money rolling in, it is just as important to ax needless expenses to boost profitability.
To help you do just that, below are four key tips to cut spendings, optimize your budget, and ultimately, grow your solo enterprise.
Rethink your place of business
One of the biggest perks of choosing the freelance lifestyle is that it grants you the freedom to work from anywhere on the planet. Not to mention the freedom to choose your own working hours over the dreaded 9-5.
The obvious direct benefit of this freedom is that you’re no longer obliged to work from a place where the cost of living and taxes are high. Get away from upscale urban life to not only slash living expenses but to also appreciate the thrill of exploring new places. You can save hundreds (or even thousands) of bucks by moving to a cheaper country.
Here are a few of the many beautiful countries where you can move to with relative ease and continue working on your solo venture:
- Sri Lanka
To achieve peak productivity when working from paradise, consider renting a co-working space. This would ensure reliable internet connectivity, among other essentials, is in place.
Leverage the right tools
Web apps and tools play a huge role in your day-to-day freelance operations. From hunting clients to sending invoices, there’s a tool for everything. Prudently putting together your suite of business tools can make a substantial difference in raising your profitability.
Capitalize on the cost savings many free (or nearly free) tools offer while providing the same capabilities and features as their paid counterparts.
Take a leaf out of this time-tested and pocket-friendly toolkit:
- Google Drive: A free suite of tools for creating, sharing, and storing documents, spreadsheets, presentations, and more.
- Trello: Free web app for efficiently managing your projects the Kanban way.
- Slack: A great app for real-time messaging and file sharing.
- Canva: The start-to-finish, beginner-friendly, and free design app for all your social media graphics needs.
- Wave: Free software for all your accounting and invoicing needs.
- Unsplash: The best free collection of stock photos.
- Join.me: An ideal free tool for remote client meetings and screen sharing.
- BuzzSumo: The ultimate tool to source ideas for your content and social media strategy.
- Grammarly: A must-have freemium tool to detect and dodge grammatical mistakes in your emails and content.
- Clockify: Time is money. Track your productivity for free with this neat little app.
- Hunter.io: Find email addresses for pitching prospective clients with this freemium tool.
This may sound counterintuitive at first, but outsourcing can make a lot of sense for serious, full-time freelancers. Sure, being a “solopreneur”, you are the only person liable for getting the job done. But that doesn’t mean you have to actually do all the work yourself.
You’re no expert at everything ─ who is? Nevertheless, it shouldn’t stop you from accepting interesting work or taking on bigger clients with deep pockets. After all, you want your solo venture to thrive, not just survive (as many freelancers do).
Don’t fret if part of your deliverables entail tasks you’re not particularly good at. Instead of slogging on those wearisome tasks, you’ll be better off using the same time to work on the deliverables you’re actually skilled at, don’t you think?
If the person or agency you outsource the work to does an excellent job while you work on the stuff you’re good at, the final outcome would delight your client leading to praise and recurring work for your business.
And with modern platforms like Fiverr, outsourcing is quite straightforward, safe, and super affordable.
Routinely review your expenses
Finally, at the end of every month, take a few hours to meticulously review your monthly expenses. Analyze each expense and try to eliminate the ones that don’t, directly or indirectly, result in the growth of your business.
Doing so, you’ll slowly but surely streamline your finances and find more money that can be invested back in the growth of your business ― honing your skills, attending conferences, upgrading your website and overall online presence, and so on. Also, make sure you have an emergency fund set aside for rainy days. And in the worst-case scenario, you can borrow some instant cash from credible short-term payday loan providers like Peachy or Speedy Cash.
But that won’t happen if you routinely review your expenses.
How do you, as a business, cut costs and maximize profitability? Spare a moment to share your ways in the comments below!