October Contractor News Round Up

Your monthly round-up of October’s top contractor news.

The intention to hire contractors has doubled over the last year and trebled in the last two.

A study by the Recruitment and Employment Confederation has shown that clients’ intention to hire contractors had doubled over the last two years as well as 36% of them admitting that they planned to increase their use of contractors over the next three months. Not only that, but another third said they planned to increase their work with contractors over a 4-12 month timescale. Read more…

The number of British women freelancers has grown by a fifth over the last four years.

More great news in the growth of the contracting and freelance sector. The latest statistics show that there are 21% more female sole traders than there were back in 2008. Last year stats showed that 31% of all sole traders were women and Middlesex saw the highest rise (23%) in growth. Read more…

The outlook is positive for the construction industry.

In the UK construction industry, a number of limited companies are reporting they have increased orders and profit margins. These improvements in the market mean that firms are looking for ways to expand their business – whether that means adding new locations or branching out into new sectors like power and energy. Read more…

Contractor demand across Scotland is polarising.

IT, engineering and construction industries are surging well ahead of other contracting disciplines. All the signs of a contracting skills crisis are showing, as clients and recruiters are struggling to hire engineers and technicians. This news comes from the Bank of Scotland’s report on Jobs which highlights that growth is strong although the rate of growth slowed in the month of September, and in some sectors it dipped below the national average. Read more…

Contractors could be among the small businesses losing billions every year as a result of simple mistakes.

The study by Exact shows that as many as 1 in 5 small firms may have forgotten to invoice a client for goods or services more than once. This suggests that that some of these small companies could be hindering their success with inefficient internal processes. A quarter of these small businesses said they had forgotten to invoice for a job worth anything between £500 and £1000. Read more

Top Ten Freelancing Misconceptions

Making the decision to begin freelancing is definitely not one to be taken lightly. However, there are certainly a lot of misconceptions that come with the territory. We’ve taken ten of the most common presumptions and blasted them wide open, for a happy, successful freelancing career.

1 – Freelancing gives you a lot more free time

When you announce that you’ve made the decision to go freelance, you’ll undoubtedly be met with ‘supportive’ soon-to-be-ex colleagues gushing about the fact that ‘at least you won’t have any more early mornings!’.

Sadly, that’s not necessarily the case. Whilst some days you might be able to sneak in an extra half hour in bed, if you want to keep on top of things, you should be working the same office hours as everyone else. This is mainly so that clients can get hold of you, but it also gives you some structure to your day and keeps you in the habit of working 9 to 5.

2 – Being a freelancer makes you loads of money

We’ve yet to meet a freelancer who cashed in during their first few weeks of leaving their office job, so you will probably have to stick at it for a good while before you can afford that second home in the Caribbean.

Whilst some people do charge quite a high hourly rate, the reality is that you’re not working every hour of every day, so it’s a bit of a moot point. There’s also only a certain amount of work/clients that you can service on your own, so it’s important to take it just one step at a time.

 3 – Freelancing means you don’t have a boss

You may be glad to get rid of that stuffy CEO who is stifling your creative flow, but just because you’re a freelancer doesn’t mean that you don’t have anyone to report to.

Clients and others who are paying for your time are expecting a return on investment for their cash, so not doing the work you have agreed means that you’ll certainly have someone to answer to.

Not meeting deadlines is frustrating for those who are expecting a finished product, and it will also earn you a less than desirable reputation. Treat those who you are doing work for as if they are your boss, and it should help to keep you on track.

4 – Freelancing is much less stressful

Another regular misconception that a lot of people have is that freelancing is far less stressful than ‘regular’ employment. We hate to break it to you, but this one isn’t true either.

Your schedule hours are a lot more flexible, and you do have a certain amount of freedom, but these do not necessarily a walk in the park make.

Not only do you have to be constantly on the look out for new work, you also have to structure your own time, organise your workload and then find the time to do all that work… by yourself. There’s little delegation in the freelance world!

5 – Being a freelancer means you’re lonely

A life without colleagues isn’t the be all and end all, and freelancing doesn’t necessarily have to be a lonely profession.

Not having the constraints of office life means you can arrange to meet clients and other business contacts for lunch and coffee, getting you out of your homemade office.

Thanks to the wonders of social media, there are thousands of meet-ups around the country, so why not investigating what networking events and meet-ups are going on in your area? It’s a great way to meet new people, make friends and try and snare some new business!

6 – You have to take any work you can get

No-one wants to turn away business, but just because you’re a freelancer doesn’t mean that you have to accept that job for your Aunty Jackie’s sister’s brother’s new plumbing venture.

Don’t get us wrong, it’s lovely when people think you’re worthy enough of supporting their business, but just because you’re not based in a regular office job doesn’t mean that you have to take it.

We all like doing a couple of feel-good jobs for free to help out friends and family, but sticking to your professional network will probably mean more success on the new business side of things.

7 – Anyone can do it

Similar to the assumption that freelancing is easy, a lot of people think that it’s possible for anyone to be a freelancer. However, we’d have to disagree.

You need a variety of skills to be a freelancer, just as you need a variety of skill in any other job. Good time management and organisation skills are key, and you have to be confident in what you do and how well you’re doing it in order to win new business.

Freelancing isn’t just a job that you can fall back on, and if you don’t put in a considerable amount of effort, then it’s unlikely you will succeed.

8 – You don’t have to pay taxes

Getting yourself an accountant is one of the first things you should do when you become a freelancer, as registering as self-employed with HMRC can be confusing to say the least.

You need to take responsibility for both income and tax and National Insurance, which are calculated by reference to your profits as a stand-alone business.

Even beginning to think about tacking taxes by yourself can end up leaving you a bit frazzled, so we’d definitely recommend getting a professional in to help, at least while you’re finding your feet.

9 – Freelancing limits future career opportunities

A number of people worry about life after freelancing, but moving into self-employment doesn’t mean that you have to stay there for the rest of your life.

Being able to be successful as a freelancer shows a lot of skills, many of which will impress a potential future manager. Many freelancers also see job opportunities with people that they’ve worked for on a freelance basis, so often you don’t even have to go through the tedious application stage.

Depending on the length of your freelance career, you should have a number of happy clients who are willing to give you an excellent reference.

10 – Get as many clients as possible on your first day

Don’t worry if you haven’t filled your books on your first day. You need to make sure you’re dedicating time to nurturing your business, as well as finding new clients.

Taking a few hours to make your website look top notch, spending a little bit extra on the design for some business cards that are going to make you really memorable and writing up a business plan are all things that will benefit in the long run, and mean that you can continue to grow your business.

Time Saving Tips For Your Work Day

As a Freelancer or contractor you may find there just aren’t enough hours in the day. You probably have to multitask much of the day to get work completed on time. Here are some simple time saving tips to help you with the smaller tasks in your day.

Plan, plan, plan.

It instantly helps your work flow if you have a plan in place for your working day.  Various research shows that people are most productive during the first two hours of their working day so it’s a good idea to write your to do list the night before.  That way you can focus on ticking tasks off your list as soon as you start work.  Clearly your list is going to change almost hourly, but simply writing each item down will allow you to stay on track.

Take advantage of Voicemail and out of office

It’s not an easy discipline to adopt, but you’ll soon find that if you can allow voicemail to take the strain when you’re up against it you’ll be much more efficient.  Similarly, by logging out of email for an hour or two, you’ll be able to focus on completing tasks without the constant interruption of email alerts and the temptation to deal with them as soon as they drop into your inbox. Simply removing as many potential distractions as possible for set periods of time during your day will improve concentration and output.

Mobiles and tablets

If your contracts mean you need to travel a lot take advantage of (public) travelling times and waiting rooms. Even five minutes on a mobile device will mean one less email to respond to when you get back to the office.

Pick the right jobs

It’s sometimes tempting to take on jobs that don’t closely match your area expertise, particularly when you feel you could competently take them on.  Once these projects start you may find that you need to pick up extra skills or do more research to complete them. Stick to your area and you’ll complete work quicker and keep your clients happier.

Use productivity tools

You can download or use an online productivity tool to keep you on track.  They’ll help you to stay focused by limiting the amount of time you spend on ‘time-wasting’ websites. You can also use online time-tracking tools which will give the feeling of being monitored making it more likely for you to stay on track.

Don’t multitask

We’ve mentioned this before in our ‘managing multiple clients’ post, but as well as helping in that respect it will save you many wasted hours. Doing more than one thing at a time has been proven to be counter-productive , it can slow you down from distraction as well as making you more likely to make a mistake.

September Contractor News Round Up

Your monthly round-up of September’s top contractor news.

HMRC stalks Sanzar loan scheme contractors

A number of contractors who took pat in freelance work in the UK via offshore vehicles are being approached by HMRC, which is hitting them with UK income tax assessments designed to boost its low yield from such Employee Benefit Trusts.

To advisers have confirmed that the tax assessments, from between 2008-2010, are being received by UK based contractors due to their use of an EBT from Sanzar Solutions.

Contractors to benefit from fresh PCG strategy

The first in a line of good news for contractors this month, as it was revealed that contractors will benefit from greater representation, an elevated media profile and new membership benefits as a result of a new PCG strategy.

The Professional Contractors Group is implementing a fresh strategy, as they see freelancers and contractor as a vital element of the UK’s economic recovery.

BIBA reaffirms code commitment

BIBA says that it will give more consideration to developing and producing a code of conduct, after a strategic review found that members would like the association to ‘play more of a role in driving up the level of professionalism’.

Freelancing careers become more desirable

Whilst it may be news from across the pond, it’s great to hear that freelancing jobs are becoming more desirable. It’s a bit of a sweeping generalisation to say that what happens in America will happen over here, but hopefully it will be a sign of things to come in the UK too.

Apparently 30% of the US workforce is freelance, totaling a massive 42 million workers.

Contractors help 79% of organisations to meet strategic objectives

Good news for the sector, as it has been revealed that contractors now help 79% of the UK’s client and employer organisations to meet strategic objectives.

The report brings more good news; as over a third of clients plan to increase their contractor use over the next quarter, showing a hugely positive change in the sector.

HMRC investigations yield from SMEs up a third

New figures released this month revealed that an increased focus on small and medium-sized businesses is proving fruitful for the Revenue’s teams, with overall investigation income from SMEs up to £565m in 2012-2013. This was up from £434m from the previous year, totalling a rise of 31%.

Contractor demand at twelve year high

Results were released this month, revealing that during August 2013, contractor demand reached its highest level since December 2000. This saw the fourth consecutive month of growth in the industry, and agency billings grew at the strongest rate in fifteen y

August Contractor News Round Up

Your monthly round-up of August’s top contractor news.

Small and Medium enterprise interest in freelancers is growing. The appeal of a short-term solution without having to shell out large employment costs. Hiring freelancers is becoming much more cost-effective for the companies. A report for the second quarter of the years shows that rises in specific industries ranged from 9.2% (logo design) up to a whopping 23% in the accounting sector. This shows that the self-employed are increasingly permanent fixtures in the everyday lives of some businesses. Read more…

Contractors are soon to have a say on their benefits and expenses. A report published by the Office of Tax simplification has identified ‘quick wins’ on how expenses and other tax dispensations can be dealt with. It reports that the P11D form and filling process will be subject to further work as it is known to be widely misunderstood. There will also be a ‘wholesale review’ of the current benefits and expenses.  The chair of the Association of Recruitment consultancies, Adrian Marlow said: “…Simplification of the tax system would probably result in removing the risk for agencies relating to the more extravagant tax avoidance schemes currently on offer. Therefore, this review can only be good for agencies, workers and the recruitment industry in the long run.” Read more…

According to a new jobs report, contractor vacancies in Scotland have reached a 31-month high. The decline in contractor availability paired with billings rising at their slowest pace since March of this year points toward an emerging skills crisis in Scotland. This means that there are just not enough suitably skilled contractors to meet demand. The biggest rise in demand and fall in applicants was seen in Aberdeen and its oil and gas industry, confirming that the industry is booming but the availability of skills is not. Read More…

HMRC have created a new scheme designed to help small companies and contractors/freelancers with their tax disputes. Following a two year trial HMRC have created a national team of trained facilitators to help resolve disputes using the ‘Alternative Dispute Resolution Service’. For a while now the service has helped businesses and individuals in disputes by being the middle man and helping each party understand each other and decide on an agreement.  Richard Summersgill HMRC’s Director of local compliance said: “Evidence has shown that by using the simple ADR service many disputes can be significantly shortened and resolved without recourse to Tribunal.” Read more…

How Can Contractors Avoid Late Payment?

You probably know the feeling. You have a meeting with a client; learn their work goals, complete the work and then months pass by without being paid for your work. It can be off-putting to realise a small number of clients just won’t do the right thing. So what do you do in this scenario? Here are some tips to help you deal with late payment.

Don’t assume the worst

First off, don’t assume the worst, the client may be in a very busy period and at points like this can become disorganised in paying different contractors and freelancers. Don’t lose your cool, check they have a valid reason for having not paid you on time and give them a solid second date to pay by.

Always have a contract in writing

This is the first thing you should do when agreeing to work, have a contract written up and set clear payment guidelines including date to be paid by and the amount. To cover yourself in case of a client not paying it can be good to write penalties into the contract, such as getting the other side to cover legal cost should you need to pursue them for payment. You could also include monetary penalties for late payment, this is entirely up to you though and will depend on the relationship you have with your client.

It can also be a good idea to secure a deposit before work commences, this isn’t ideal for all clients, but it is a good idea if you are concerned that the client will not be able to pay or will be late with their payments.

Consider alternatives

Find out why the client is late with their payment, if it is financial troubles at their end then attempt to agree a payment plan with them. If you are concerned about keeping a good relationship with the client you could even consider bartering a swap in trade or services that they could provide for you, in this situation you need to be creative.

Keep in mind that you may have to take legal action and be prepared to have all the appropriate documentation and witnesses if it reaches that point.

Make it worth your time

If you do decide to take the client to court then make sure it is worth your while, you don’t want to be spending the amount you’re trying to recover on legal fees.  Remember to factor in your time as well.  You could spend a significant amount of valuable work time on legal proceedings. Writing in the clause mentioned above into your work contract can help to secure legal fees from the opposite side.

The simple act of threatening legal action could be enough to get the client to pay up, send a letter stating that if they don’t pay within a certain date then you will be forced to take legal action. For added impetus, get a lawyer to write the letter to them on your behalf, but obviously don’t spend out of your means.

The Promp Payment Code is a scheme designed to help businesses (including contractors and freelancers) assess the reliability of their clients when it comes to settling accounts on time.  You can visit the site to review current signatories and have the option to challenge any that subsequently let you down.  You can find a summary of the code here.

How Can Contractors Benefit From Running A Blog?

Having a blog is a great way to keep your clients and the world at large updated on what you’re working on and any offers or promotions you may be running, as well as sharing your experiences and any industry news.  Get it right and could even generate new business leads. The only problem is that it seems to take a lot of effort to keep the blog going and often a freelancer’s blog can end up as a bit of a wasteland, with large gaps between posts.

Here are some tips on how to keep your blog interesting while helping to generate new business for you.

Choose your topic wisely

Choosing a topic for your blog is crucial, it will have to be something you truly understand and enjoy talking and reading about, otherwise the blog will fall flat and you’ll be able to tell that the passion isn’t there through the writing.

Try a topic related to your work, offering tips and advice to others within your industry and keep it topical with news updates from the industry too. Any possible clients who discover your blog will see that you are active within the industry and the fact you offer help and advice to others should create a very good first impression.

Another option is to choose something entirely unrelated to your business  that you have a passion for.  It may seem that a blog unrelated to your industry is frivolous and unlikely to generate the readership you need to generate new business.  In fact, you’re much more likely to generate a readership and word of mouth recommendations by writing about something you have a passion for than you are something you have little interest in, or by starting a blog that you struggle to keep up to date.  If you’re not interested in what you write about, there’s a good chance no-one is going to be interested in what you write.  Think of a blog as a self-marketing tool.  If it generates interest, it will generate business too.

If you specialise in a particular industry a blog providing a service to your clients and prospects is a great angle to take.  You can demonstrate you knowledge and expertise in the area by offering tips and advice which is sure to appeal to prospective clients. You can teach them a little about your own industry so they can pick up some skills themselves and better understand the processes you follow when contracting for them.  This is a simple blog to maintain as you won’t struggle for relevant content.

Drive lead generation

Although it’s not recommended to turn your blog into an extended catalogue of services there are multiple ways in which it can help freelancers or contractors to create business leads.  Simply inserting a ‘hire me’ button on your blog homepage will give prospective clients an easy way to see you are available for hire and give them quick access to your contact details.   Creating a subscribe button will not only make sure  your readers receive an email when your latest post goes live, it will also give you access to their email addresses so you’ll know who they are, often where they work and then design any marketing campaigns based on the information you collect.

New Content

Make sure that your blog is updated regularly, this can be a difficult discipline to maintain but a dormant or sporadic blog is frustrating for your loyal readers and they’ll soon find something else to read and stop recommending your page to their peers.  Make your blog entry a part of your routine.  Ideally post a minimum of once per week.

Finally, make post headlines strong for SEO purposes and make sure the content is relevant to the title, as well as delivering interesting and useful information.  Another important aspect is blog engagement, if prospects can see comments and your responses on blog posts and any social sharing it will be much more likely to generate new, regular readers. Encourage commenting and sharing whenever possible without being spammy.

Most importantly, never begin a blog for the sake of it.  If it’s something you feel you have to do, rather than want to do, it’s probably not for you.  A blog should reflect your enthusiasm and knowledge for the topic, not feel like a chore to write, or read for that matter.

Clients You Should Avoid As A Contractor

As a contractor you probably want to jump at every work opportunity that comes your way, though realistically you should probably be looking out for the clients you don’t want to work with. You probably already know a few. Here are some warning signs of those you probably don’t want to be working with or for.

“I’m not entirely sure what I want”

You may be getting a feeling of déjà vu here; this client is never going to be satisfied with the end project, regardless of the quality of your work and any advice you may give them. The other problem may be that they do secretly know what they want but their expectations are way too high for what you could ever accomplish for their budget or timescale.

The best thing to do after you’ve spotted this client (probably because you’ve heard a phrase similar to that of the above) is to make sure you set up a meeting or conversation to go over expectations and to discuss the nearer goals. Also check on how they will measure the success of the project, and check that you both have the same gauge on what you are expecting.

“I’m out of the office until… forever”

This client is the one who never replies to anything. The sort who you start work for and need a bit of follow up information or feedback so you send them an email.  Then you send a follow up email and then a follow up call and then ten more, all with no reply. They disappear off of the face of the earth when it matters most. If an initial question you have for them during the pitching process takes 4 days to be answered then you probably should take note and think about backing out gracefully from working from with the client, it’s likely you’ll have this problem throughout your work with them and you don’t want that especially when it comes to being paid.

“I can’t pay you, but I can offer you…”

No. Nothing good will come from this transaction.  Unless they’re offering you the best seats in the house at the concert you’ve been dying to go to, then don’t make a deal with this person. Even then it’s probably not recommended, unless it’s a reasonable request of you and your work. When you meet this customer and you decide to go ahead ahead, make sure you set out an agreement of what you both expect from each other. Also make sure that the amount of whatever is being given in the trade equates as closely as possible to a monetary value for the time you’ll spending doing the work for them.

“How is it going? Any updates? Just calling to see if we can have a meeting?”

The over eager client constantly calls and emails for an update and wants a face to face meeting at a base. They act like an overly attached partner. You’ll want to avoid this client because it will take up your time, whether it be delaying their own project or taking time out of other things you’re working on. You can spot these clients straight away as they’ll unrelentingly contact you in the early stages of a project. It would probably be advised to avoid them as clients as the frustration of constant interruptions will inevitably have a detrimental effect  on your relationship with them, leaving your chance of a recommendation slim and your attitude affecting your work.

Do you have any stories of clients you wish you’d never contracted for, or any near misses?  let us know in the comments box.

 

How To Retain Clients As A Contractor

You’ve found the perfect client.  You enjoy the work, you communicate well and they’re reliable payers.  Your existing customers could well be the foundation of a thriving business so it feels crucial that they keep coming back to you. When you’re good at what you do, returning customers are generally more profitable than new ones and it’s definitely easier to get business from them than to go out scouting for new business.  Here are some tips and incentives on how to retain clients as a contractor.

If they’re a valued customer, make sure they feel like one.

It might seem obvious but it’s surprising how many businesses take their existing clients for granted and loyalty to a supplier only goes so far when everyone is fighting for a contract.  It’s important not to pander to your new or prospective clients so much that you forget your best clients. Returning customers have given you more work than anyone and may have even referred you to others so put them first.  Offer them exclusive offers or services to show that you value their business. Make sure you also take note of important dates.  The personal touch goes a long way to securing customer satisfaction and loyalty.  Just remembering and making reference to conversations you had with them last month can make a big difference, as can a personal message on the company’s anniversary or a key contact’s birthday.

Create special promotions for existing clients

If you want a client to keep returning to you it makes sense to reward them when they do.  Traditionally most businesses have a couple of sales a year so why shouldn’t you?  It’ll be seen as a way of saying ‘thank you’ to those existing customers.  Perhaps basing a ‘sale’ or reduced price period around an event would work well, for example, a summer sale or a birthday promo, especially if you know there’s a lull in work at specific times of the year.

Make the effort to stay in touch

A client may not always have work for you but that doesn’t mean you should sacrifice the relationship during quiet periods. Make the effort to touch base with them every now and then to see how they are getting on.  Clearly they won’t want to be bombarded with marketing , but a personal email or phone call every so often will make them less likely to start shopping around.  Keeping in touch with any important news associated with the industry can be a great way to create discussion with a company and to show you genuinely understand them and what has an impact on their business.

Create something just for them

You could create your own personal newsletter to send out to an email list of existing clients (with their permission), an update on any ‘special offers’ (see above) or hints and tips about your industry and any other news that may be relevant to them.  Some freelancers provide an information package when they win a new client so that they have relevant contact details, pricing and process information to hand when they need it.

Of course, keeping the business ‘hopper’ full also relies on new business so our next blog will feature some tips for winning business and some of the top websites for finding those new contracts that could lead to valued, long term clients.

If you have any other ideas to share, please add them in the comments below.

June Contractor News Round Up

Your monthly round-up of June’s top contractor news.

 

Kingsbridge Professional Solutions launch a new BIBA scheme

KPSol have just launched professional indemnity scheme for freelance professionals with BIBA (British Insurance Brokers’ Association).

The scheme has been designed to allow other brokers access to a policy, specifically designed for freelancers and contractors or those who are working as sole traders.  It’s available exclusively to BIBA members.

With freelancing being the fastest growing sector of workers, (over 1.56 million working in 2012) the scheme caters specifically for their business needs and is available at an extremely competitive price.    Brokers can benefit from our experience in this rapidly growing sector and get access to a scheme which provides comprehensive cover and peace of mind for their client.  A white label solution is also available.  Visit our website for more details.

Boom in youth self employment

Britain is likely to see a boom in self-employment amongst the young workforce; currently only about 5% of the young population are already self-employed. This is all according to a report from the Prince’s Trust that shows a sizeable number of young adults aspire to follow that 5% into self-employment. A quarter of those surveyed said that with the job market becoming ever more competitive, they would rather work for themselves than search exhaustively for more traditional ‘employee’ role.

High youth unemployment rates between the ages of 16-30 are the reason behind the spike in young self-employed professionals.  Many are drawn to the appeal of self-employment because of the freedom that can accompany it especially as, with the development of on-line technology, work can be much more portable.   46% of young adults predicted that it will soon be possible to work at any location on the planet.

The research reveals an upturn in entrepreneurial moods from young adults and more and more are seeing self-employment as a way to break the cycle of joblessness.

Zero-hours contract workers earn £6 an hour less than colleagues

Another survey this month has revealed that contract workers on 0 hour contracts can earn up to £6 an hour less than colleagues.

Employers have been shown to exploit the flexible arrangements of contractors by paying them low wages, some employees on 0 hour contracts were paid £6 per hour less than those with set hours. The resolution foundation has warned the government that increasing implementation of these 0 hour contracts across public and private sectors is undermining basic employment rights and hitting younger workers especially hard.

Vince Cable has refused to ban the practice, but has hinted he may be willing to fight for stronger protections if employers are found to be abusing the system. The contracts mean that employers can adjust staff hours week to week with no set minimum wage for the week.

It was also admitted by The Resolution Foundation “…that the benefits these contracts provide for employers come at too high a price for the majority of those employed on them.”

Are you noticing an increase in young contractors and freelancers or have you lost out by signing a zero hours contract?  Tell us about your experiences by leaving a comment below.