Entrepreneurs, especially those who work as freelancers and contractors, often feel they need to compromise their rates or change the way they work or accept last-minute projects from clients who are “in a bind” (which puts you in a bind if you choose to accept the work).
Yes, when you are trying to build clientele or a portfolio, compromises may have to be made. But that stage should be temporary. Examine your outcomes, your goals, and the plan to get there so you know what work and clientele will benefit your objective—and which ones won’t.
Entrepreneurs have to make a lot of decisions in order to grow their business and establish their brand. To make smart decisions, you must be clear on the preferred outcomes, honest about how to achieve those outcomes, and willing to walk away from potentially lucrative contracts that do not align with your vision.
Leave emotion out of business decisions
Entrepreneurs who make decisions based on emotion, rather than good business sense, do not grow their business—ever. Consumers buy based on emotion; clients favor the financial “what’s in it for me” (WIIFM) aspect.
It’s imperative that business owners have clear guidelines about running and growing their business to boost their confidence in those times when emotions sow doubt or confusion.
Entrepreneurs sometimes take on a client because the project might be “fun,” or they could use the “extra” money, or because the client is a friend. Other times, they hesitate to make waves with a long-time client or offer to do a “favor” because they feel bad for a client for whatever reason. Yet, when they allow those clients to argue with their rates or refuse to work according to the entrepreneur’s terms, then ultimately entrepreneurs hurt their business and stifle their goals.
Additionally, if you put your tail between your legs and allow clients to dictate your rates or work terms, you could be considered an employee of the company. And if that’s the case, the company has to pay you benefits, health care and send you a W-2, lest the IRS catches wind of the questionable tactics.
Creating concise guidelines for your business will keep you from steering off track of desired outcomes. And they can help remind you why you might say “no.”
Focus on your outcomes and be honest about what you won’t do
Start by stepping back and analyzing why you do what you do. Focus on your outcomes, write down the goals you must achieve to get you there, and detail your plan to reach those goals. Make a list of what you will do, and especially, what you won’t do. Include your financial goals in those lists.
If a client (even a long-time client) isn’t going to help you reach your goals or wants you to take on a project that falls on your “won’t do” list, walk away. Otherwise, your compromises will cost you. The contract might be financially profitable, but if you are forced to make compromises that will stymie your progress, it isn’t the right contract for you.
Allowing a client or potential client to corner you or manipulate you into feeling like a louse unless you take a job on their terms is not a good business decision. And bowing to their terms, again, makes you an employee.
When clients quip they can’t do something without you, keep in mind they can find someone else. And they will if they have to. That’s how business is run. You might think that a client who seems overly dependent on you could provide the perfect opportunity to hike your rates, but if that client does not harmonize with where you’re headed, it isn’t the right client.
Remember that you are your business and your brand, and you should not only set the bar high, but you should also be consistently setting it higher, not lower. Make a habit of saying “no.” Walking away from more than half of client requests should be the norm.
You and your business are your brand
Your clientele will change as your business model changes—and your business model should change if you want to grow and innovate. Don’t feel guilty when you move away from current clients. This is part of business growth and expansion. Your clients do the same thing.
And don’t compromise your rates or working terms just because a client or potential client promises to bring you more future work, to introduce you to others, to “help” you in some way. Such promises are empty promises unless they are backed up by a contract, payment for your work, and proof. It’s up to you to grow your business; it’s not the job for anyone else. They owe you nothing and will give you nothing that doesn’t give them more first.
Clients are not your “friends.” They are business partners who expect the same professional relationship with you that you expect with them, until they finally drop you for someone or something else.
The takeaway: It’s up to you to strengthen your business by knowing where you’re headed, how you’ll get there and standing firm for your standards and terms—even if that means turning down lucrative contracts or disappointing potential clients.