FAQ and Sample Documents From My Business

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I am getting a lot of questions lately regarding business practices, documents, and resources for people doing what I’m doing. In this post, I will attempt to hit the high points and answer the most frequently asked questions about freelancing, running a tiny business, working from home, etc. At the end you will find a list of sample documents you can steal from for your own purposes. Enjoy!

Disclaimer: We do websites, graphics, and media. The information here is not appropriate for every industry, nor is it necessarily the only way to do things, but it’s how my company does things at the time I write this. I am constantly refining the way we do things and improving systems, so this info could change. That said, I’m not responsible for any legal crap or angry clients. Carry on.

FAQ


Pricing

How do I determine pricing? Trial and error. Know what you need to make to survive. Know what potential clients are willing to pay. Make up something you are happy with. Don’t be afraid to quote a price. I hear this sort of thing a lot: “I worry I will quote too high/low and lose a client”. You will, at some point, and life will go on. When I designed my first logo, I had no idea what to charge. It was just me, freelancing, with limited (I.E. no real) experience. I charged less than $100. I did a mediocre job, because I didn’t know how to do a great job yet. Client was happy. I charge more now, I don’t do all the work myself, and I have a process. I wouldn’t charge less than $400 for a basic brand mark, but I didn’t start out that way, and neither should you.

How do I raise my pricing? You edit the rate sheet, web page, or wherever it is. You don’t need permission to raise your pricing if you’re freelancing. Up your price a bit and see if anyone complains. Chances are, the people who complain are the most frustrating clients anyway. It amazed me that as I upped my prices, my clients actually became easier to work with. I was suddenly working with people who planned to spend good money and trusted me to do a professional job, instead of micromanaging and penny pinching. I’m not hating on little clients, but you may find that the longer you are in the industry, the more your focus shifts toward people who understand what you are trying to do and appreciate your work. Those people don’t mind paying. In fact, they may think you are under-charging. I actually had clients send me checks for more than I invoiced a few times in the early days and flat out tell me “You need to raise your prices”. That’s a good sign you need to raise your prices.

Should I advertise my pricing? Yes. At least to some extent. If a potential client is browsing your portfolio, they don’t want to fill out a form to get a quote unless they think you are the cream of the crop. Filling out a quote form is a waste of time if they don’t even know if you are in the same galaxy as their budget. I advertise base prices for services. This gives potential clients an idea of where our pricing begins, which eliminates a lot of low end clients who would not want to pay our prices, but might still engage me in a long email chain before we discovered that if they didn’t see a number somewhere. Trust me, it saves you unnecessary back-and-forth if you post your pricing somewhere in some form.

Billing

What do you use for billing? Currently we use Xero. In the past, I tried PayPal and FreshBooks, and I may try other things in the future, but for the moment, Xero does the job. My bookkeeper likes it better than FreshBooks because of the functionality and the ability to reconcile the books in ways FreshBooks does not. I don’t do the bookkeeping, but I can say that, when I did the bookkeeping, the best software was the one I actually used. Most of the tools out there do the basics well, it’s just that freelancers and beginners neglect their finances. It is, undoubtedly, the linchpin of your business. Whatever you choose, use it.

When do you bill? I bill upfront, ever single time. For large projects, we often bill a portion up front (50% is common for web work) and the rest on completion, but we don’t raise a finger until the first invoice clears.

SUGGESTION: This is not a common question, but it would solve a few common problems if more baby freelancers specified expectations for payment in their invoices. I work with some big clients who write checks to dozens of people like me every month. They don’t pay invoices the day they get them. They generally have a net30 or net15 system for paying invoices, meaning they assume, unless you specify something different, that they have 30 days to take care of the invoice. They are in no hurry. In large companies, a check for $500 isn’t high on anyone’s radar. They will get around to it eventually. If you want to get paid by a certain time, specify it in the invoice. I don’t recommend requiring same day payment. Give them some time, and don’t bug them about outstanding invoices until after that time elapses.

What if they don’t pay? Then we don’t work. If it’s a final payment on a project they have already partially paid on, we don’t deliver final files until the last payment clears. If you have already delivered the goods, sent the invoice, and they have gone silent, wait until after the specified date of payment, then send them a reminder. If they still don’t pay, send them another reminder the following week. Be polite. Be firm. Be all business, no emotions. Don’t tell them you have kids to feed or medical problems, just remind them of the outstanding invoice. If they continue to refuse payment after a reminder or two, personally reach out. Perhaps there is a problem or miscommunication. If a client flat refuses to pay, you’ve sent multiple reminders, reached out, waited, waited, and waited some more, you are faced with a choice: allow someone else to try and collect it, take them to court, or call it a loss and structure your system so this doesn’t happen again. A collector will take a percentage of whatever they get, courts will take your firstborn child and your sanity, and calling it a loss will take some grace and humility. Either way, it’s a hard choice. Unless it is a substantial amount, I would never mess with courts. When I say substantial, I mean a lot of money and the potential of my children starving as a result. I have only ever mentioned legal action once to a delinquent client, and it was, thankfully, not necessary in that case. I do allow my bookkeeper to continue hassling overdue clients so I don’t risk getting personally involved, and I have had to eat some pretty big losses over the years. At some point I walked away mentally and chose to invest my effort into forward motion instead of being bitter over unmet expectations. I am still friends with some people who owe me thousands of dollars. I would never do business with them again, but we get coffee on occasion, and I believe my life is better because I chose to let it go.

Marketing

How do I promote myself? I have grown all of my past businesses with face-to-face network marketing. I am an introvert, and I am not particularly fond of socializing, but I learned to communicate well and build trust so that the right people would drop my name at the right time. I shopped local business networks and looked for groups who seemed professional and who met frequently. In recent years, coworking has been a huge benefit. People buy from people, not from brands–especially if you are freelancing. No one cares what I named your design studio or media company. Most people referred to me only know my name, and the fact someone they trusted told them my name. I have done business with most of my clients simply based on trust. Get around people. Find a community, contribute to it. Also, involve yourself in good projects. I’m not advocating you take anything for exposure, but there are projects of value to which you can contribute and from which you will gain notoriety. This is a distant second to networking, but I have taken photos, built designs, and setup websites for some key companies at a discount rate because I knew the benefits of being involved in the project would be worth the trade-off.

Should I donate my time? Yes. Carefully. YOU choose to whom you donate your time. Don’t be fast-talked into taking work for “exposure”. I went down that road, and I felt like an aspiring actor who got talked into stripping–Sony isn’t going to care that you work with Bob from Bob’s Auto Shop. Conversely, I would never work with Sony for free just to say I did. If I am going to donate my time, the project should meet the following criteria:

  1. Makes a difference in the world which harmonizes with my core values
  2. Would never happen otherwise
  3. Is for people who are aware of the value of my time
  4. Plays to my strengths
  5. Can be done by a deadline I specify (very soon)

I have donated time to orphanages, overseas work, local initiatives, and social enterprises. Donate because you care, not because you hope someone will see it and pay you a lot of money. People don’t watch me work for free, then decide to turn around and hire me for a big budget job. That has never, ever happened to me.

Spec work? Should you send designs, sketches, mocks, samples, etc to a client that has not officially hired you for the job? I don’t. Some people do, but I don’t have time for that. If you want me to work, pay me. My plumber doesn’t do spec, my developer doesn’t do spec, my doctor doesn’t do spec. I have a portfolio of work, lest you doubt my abilities. In the early days, I didn’t. I took everything anyone offered me and pursued it gleefully, with no thought for budget. You may do this a few times in the beginning, but I don’t know any friends who are cool with working for free and hoping they get hired.

Deadlines

Should I set deadlines? Yes. Even if the client does not. Every time we have no deadlines or hazy deadlines, the project either stretches into infinity or the client expects us to have finished yesterday. Set deadlines. You may need to adjust them as a result of client delays or unforeseen circumstances, but talk about the adjustments and know when you plan to be done. The finish line is the only thing that makes a marathon bearable.

What if they ask for a rush job? On occasion, a client will need something ASAP (especially poorly organized clients). I am cautious with ASAP jobs. I consider not only the difficulty of the job, but the toll it will take on my sanity. If it doesn’t seem worth it, I refer it on. If I am willing to take it, I charge a rush fee (usually a percentage of the overall cost). The rush fee makes me feel better about the crunch and helps the client see the benefits of being more prepared in the future.

What if I miss a deadline? If it’s your fault, apologize and get your stuff done. If it’s their fault and they are complaining about deadlines, outline the progress so far and patiently (un-accusingly) point out the cause of the delay and what realistic expectations are from here forward. Point out actions they can take to help wrap up the project.

Conflict

What if a client gets mad at me? Someone will, eventually. When I get an unpleasant email, I immediately feel my chest burning and my blood pressure rising, and that defense instinct kicking in. It happens to us all. Just don’t reply when you are feeling it. I take a walk or go get a snack, give myself some space, and try to put myself in their position. Your clients are human. They are stressed. In almost every case, their main concern is the project, not you. I try never to interpret a client’s words as a personal attack. Sometimes, when I look at it from their perspective, I see a mistake I made. When appropriate, I respond with a specific apology for my mistake. If I don’t believe I am at fault, I respond with a general apology for the fact they are dissatisfied. I suggest possible solutions and keep the focus on their goals, not my feelings.

What if I screw up a project? I have discounted projects due to failure on my end, either because of something I did or something a team member did. I have only completely refunded one job, and it was a total failure on my end. I felt it was in the client’s best interest that I acknowledge it and refund his money, as we were swamped with other work and I could not see a way to rectify the mistake in the time frame he required. Own your mistakes. Make it right. Convey your intention to do both the previous things to your client. Be attentive to their reaction to your mistake and respect their feelings.

What if I don’t like my client? I have worked with some difficult personalities, and some people thought I was difficult to work with. If I find myself working with a challenging personality, I ask myself a few questions: (1) are they functioning within the contract? (2) are they intentionally disrespecting me or is this just their personality? (3) can I still complete this project, given the headache of working with this client? Most of the time I encounter tough personality types, it is just who they are, but they still pay on time, get me what I need, and are sometimes completely unaware that their words or actions drive me nuts. I let them be. If I don’t think they are intentionally disrespecting me, I give them the benefit of the doubt. They come from a different background and function in a different environment which probably works for them. If they are calling me names or being unprofessional, I will point that out and caution them that we do not continue working with clients who display this behavior. I will not, however, interpret it as a personal attack, but rather a general breach of communicative protocol. In other words, I don’t get mad or return the hostility, I just give them a formal warning that this behavior is not helpful and will not be tolerated.

Documents

We use several documents regularly in our work. We have prepared some sample forms which we have actually used, but removed specific client info from. You are welcome to take and modify them for your own needs. I’m pretty sure most of these are modifications of someone else’s basic layout anyway.

Basic Website Proposal – This has our general wording and talks about things like billing, deliverables, and process.

Basic Logo Proposal

Retainer Proposal – A proposal for retainer services.

Basic Promo – This is a simple promotional piece we can attach to an email to show clients what we do.

Photography Pricing – This is a pricing sheet I have used with my photography company to explain hourly and day rates.

Basic Invoice

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