02 May 2006
Work Less, Earn More
Lars Koudal’s So you want to run your own business? tackles some naive misconceptions. Yeah, working for yourself is tough, but often people let their work ethic or lack of confidence lead them astray.
Let’s say you’re a fresh-faced young freelance web developer with several new clients, trying to fit together sensible working weeks but also cramming in last-minute projects you feel you simply can’t turn down. It’s going well, with lots of work now coming in. Before you know it you’re putting in long hours, telling yourself it’s worth it for the money and prestige yet never quite feeling you’re getting significantly richer or happier.
The problem is, when you’re caught up in that you can lose sight of simple supply-and-demand economics. Busy all the time? Charge more, work less, and improve quality. Charge even more for a quick turnaround, and turn projects down if they’ll seriously jeopardise existing deadlines. Still in demand 6 months later? Bump prices up again, and maybe invest more time in research or self-promotion to allow you to increase your rates further; charge whatever the market will bear. Telling a regular client you want more cash is hard, but you have to be rational and accept the risk of losing them.
I wish I’d fully realised this and had the confidence to see it through eight years ago. Instead, I focused on volume and thought I was being clever cramming in last-minute work to earn more. On spare days I was too knackered to do anything constructive, meaning the business didn’t move forward and I didn’t feel I could charge more. I was busy and broke, yet could’ve easily doubled or trebled my rates in most cases by approaching things differently.