The definitive guide to freelancing
Since the COVID 19 pandemic, the way we work has changed. Many employees have enjoyed the freedom that came with working independently from home and have taken the step to become freelancers.
There are many different types of freelancers working in just as many industries. But what is a freelancer? In this blog, we'll explain what they are, how it works, and whether or not it might be the right career path for you.
What is a freelancer?
In short, a freelancer is someone who works with clients outside of a company structure. They normally work for a number of different companies on an as-needed basis, set their own hours, and their own prices and payment terms. Professionals will often offer a combination of services such as copywriting and design that makes them more attractive to potential clients [1].
The work varies from person to person. Some more established freelancers exclusively take long-term, high-value projects with companies they've built strong professional relationships with. Others prefer to take on smaller short term projects for companies they may only work with a few times. Depending on the industry, some workers will work at home and some will work in-office or onsite.
Traditionally, most freelancers work in a creative capacity as writers, designers and producers though they can be found in nearly every industry. In the UK, it's estimated that an average of 32% of creatives work as freelancers compared to an average of 14% working in other industries [2].
Construction is another industry that uses a lot of freelance labour. In the UK, they make up an average of 51% of the workforce on any given construction project [3]. The more specialised the construction skill, the larger price the work is able to command.
Anyone with a marketable skill can be a freelancer. Many writers, graphic designers, and web designers take extra jobs to supplement their income.
If you're interested in becoming a freelancer, take time to evaluate your skills, identify the most marketable one, and start looking for clients. Many people find their clients on freelancer websites or through social media such as LinkedIn. If you're creative, it's a good idea to compile a portfolio of your best work to show to potential clients.
Sole trader and proprietorship vs freelancer
It may seem like freelancing is a lot like working as a sole trader or sole proprietorship. This is because freelancing and sole trading are both similar in terms of how they operate. Both set their own rates, work when they want to, write their own invoices, and take on the responsibility for paying taxes once self-employed.
While both freelancers and sole traders work for themselves as self-employed people, sole traders and proprietorships are defined legal statuses. Freelancing simply describes the type of work freelancers do [4]. Many full time freelancers choose to set themselves up as sole traders and proprietors to make managing their careers easier.
The benefits of freelancing
There are as many different reasons to go freelance as there are freelancers. There are a number of different benefits that we've compiled here:
Freedom
Freelancing offers workers unparalleled control of their work-life. It allows workers to set their own rates and the option to take as much or as little work as they want.
Low overheads
In the creative industry, often all a freelancer needs is a laptop. On worksites, relevant equipment is generally provided by the client.
Skill progression
Due to the fact that they work with a wide variety of clients, workers are able to continually improve and grow their skill set. Freelancers skilled in multiple disciplines are always in high demand.
The chance to run your own business
The vast majority of people never get the chance to run their own business in the way freelancers do. This is invaluable experience and can lead to a wide range of opportunities further down the line.
Work from anywhere
Unless you're doing contract work on-site, many workers have the option to work from wherever they please. This could be a home office, a favourite coffee shop, or even a leafy green park.
If these benefits sound appealing to you, it may be worth considering becoming a freelancer. As with any big career step, make sure you do your own research and see if you're ready to start your new career.
The disadvantages of freelancing
Despite the many benefits, there are of course definite downsides to working for yourself as a freelancer. For some, these disadvantages are enough to stay in their safer salaried positions:
Insecurity
Unfortunately, insecurity is an issue that nearly all freelancers will run into at some point. As they aren't guaranteed a salary, there's a chance they'll run into tough times if work is slow.
Lack of benefits
Self-employed people aren't entitled to sick days, holiday pay, and end-of-year bonuses. If a freelancer needs to take time off for any reason, they pay for it with money from their pocket. This makes it very hard for some people to justify any time off.
Unpredictable income
Due to the nature of the work, one month may earn you twice as much as you would usually make while the next could see you struggling to make ends meet. Freelancers are constantly having to think ahead and worry about where the next job is coming from.
Loneliness
While some value the solitude that comes from working by yourself, it can be undeniably lonely working as a freelancer. Without the constant company of colleagues, some freelancers feel isolated and unsupported.
Admin
In a traditional business, many of the day-to-day admin tasks are handled by a dedicated team. Freelancers must do all of this themselves. This includes writing invoices, setting up their own insurance, and handling their own taxes.
Simplify financial management with a reliable POS system
Financial management is a huge part of being a freelancer, but it doesn’t have to be stressful and time-consuming. By choosing the right financial software for your small business, you can turn your attention to important things like looking after your clients.
Epos Now offers state-of-the-art POS systems for businesses in various industries. We let you choose the tools and insights to help make your business achieve its goals. You can do everything from processing transactions and printing receipts to taking inventory.
With Epos Now, you can also:
- Create and send invoices using simple templates
- Receive and pay ongoing invoices automatically
- Review profitability reports based on individual product performance, trending items, best and worst sellers, and employee sales
- View sales analyses on profit margin, cash flow, and other expenses
- Access multi-award-winning inventory management systems that sync online sales and in-person sales for the most up-to-date stock levels
- Automate stock purchasing so you never miss a sales opportunity
- Save customer contact details and shopping preferences for more targeted marketing on our CRM system
- Integrate with the business automation apps that are right for your business
- Simplify employee management for more efficient scheduling and payroll