Last time in Life on Contract, I discussed ways to figure out a starting point on how much to charge for your services. However, sometimes you and a client may wish to work together but for some reason they cannot (or do not wish to) pay what you have decided to charge. If you are inexperienced, it can be tempting to assume you have overpriced yourself and discount down to what they are willing to pay. But if your price is a number you have chosen for reasons you can explain, dropping it is not something you should do unless you have thought about it carefully.
Instead of just agreeing to do the same work but for less money, it is often possible to offer a lower overall cost without cheapening the value of your work. I’ll share a process I use to find opportunities to make this happen.
It Should be Win-Win, Not Hard Sell
The best case scenario is a client wants your service, your cost is within their budget, and everyone agrees to work together. Tragically, the process isn’t always that smooth. If cost is an issue, the alternative to lowering your price is to fine-tune what you provide to better fit the actual needs. To do that, you will need two things:
- A detailed understanding of your own time and costs for the work.
- Knowledge of what things your client considers most important.
By intimately knowing your own costs, you can figure out where to make savings without scrimping on the things your client considers important.
Continue reading “Life On Contract: Lowering Your Cost without Dropping Your Price”
If you’re comfortable with the technical side of becoming a consultant or contractor but are unsure what to charge for your services, you’re not alone. “How much do I charge?” is a tough question, made even tougher by the fact that discussing money can be awkward, and at times virtually taboo.
As a result it’s not uncommon for the issue to get put off because it’s outside one’s comfort zone. Technical people in particular tend to suffer from an “if you build it, they will come” mentality; we get the technical side of things all figured out and just sort of assume that the rest — customers, money, and so forth — will fall into place afterward. If you’re lucky, it will! But it’s better to do some planning.
The short and simple answer of how much to charge is a mix of “it depends” and “whatever the market bears” but of course, that’s incredibly unhelpful all by itself. It’s time to make the whole process of getting started a bit less opaque.
A stubborn determination to solve my own problems has given me plenty of opportunity to make mistakes and commit inefficiencies over the years; I’ve ended up with a process that works for me, but I also happen to think it is fairly generally applicable. Hopefully, sharing the lessons I’ve learned will help make your own process of figuring out what to charge easier, or at least make the inevitable blunders less costly.
Continue reading “Life on Contract: How Much Do I Charge?”
You’re a contractor and people are paying you to work in your pajamas. It’s a life of luxury, but when tax time comes, you are in a world of hurt and you wonder why you even do it. Taxes are tricky, but there are some tools you can use to make it less painful on your pocketbook. With planning and diligence, you can significantly increase the amount of money that stays in your bank account. Continue reading “Life on Contract: Hacking your Taxes”
I believe higher quality learning happens from sharing failure than from sharing stories of success. If you have set your mind to living on contract, I present this cheat sheet of some of the most simple and effective ways to muck it all up that have surprisingly little or nothing to do with your technical skill, knowledge, or even deliverables.
The previous installment of Life on Contract discussed how one might find clients as an engineering contractor or consultant while also taking a bit of time to pull apart the idea of whether life on contract is appropriate as opposed to, for example, bootstrapping a business instead. Assuming you are set on working as a contractor, let’s talk about what happens after you have found a prospective client (or perhaps more likely: after they have found you.)
WARNING: this article features an utter lack of success tips and tricks. Partly because those can be found in any seminar or business self-help book, but mostly because I do not have a foolproof recipe for success, and cheat codes to unlock easy mode still elude me. But I have witnessed (or committed) and reflected on many excellent ways to fail at contracting; or at the very least succeed in not being invited back.
Just because I won’t be sharing success stories doesn’t mean success has no learning value. Got a success story, or a better way to fail? Tell us about it in the comments!
Continue reading “Life on Contract: How to Fail at Contracting Regardless of Skill”
Meetings can actually be useful. It’s hard to believe, but they can actually save time if done right. While most of us are in a perpetual state of torture by Kevin in marketing holding another three-hour meeting during lunch hours, there are a few of us who know their hidden power when put in the right hands.
Working as a contractor, wasted meetings mean wasted billable hours. Even wasted meeting time is covered in the cost of the contract it runs the risk of giving the client the impression that you’re not as productive as originally thought. Organized, productive meetings show that you know what you’re doing and that the cost of your services as a whole is a good value. Yeah, some meetings suck but they are necessary and should be productive.
A meeting needs three things to be worth the time spent on it.
- A well prepared for, simple, and clear agenda.
- A time limit.
- Something needs to be written down at the end of it.
I’ll start with the third item as it shapes the rest. The point of a meeting is to have something to write down at the end of the meeting. Any meeting that ends up in anything requiring fallible human memory was a waste of everyone’s time. This includes, verbal agreements, handshake agreements, ideating (pronounced idioting), brainstorming, think tanking, and the like.
Continue reading “Life On Contract: How To Have a Meeting”
You sit there, irritation bubbling deep within as minute forty-five of the meeting ticks past on the clock in the corner of the office. Fight or flight is in a contest with your attention span as you struggle to keep an interested look on your face while they drone on. Real work could be done in this time. Maybe if you go to the bathroom you could sort of… fast forward the meeting. Panicked thinking continues for a bit until your awareness snaps back to the babble of words in the room.
“How long will it take you to do this?” the manager asks.
“A couple of days maybe?” You reply in turn. The manager nods and you take your escape. Little do you know that you have failed.
The project swerves out of control. Two days on the dot the manager is there expecting results. How? How did this happen again? It felt right! Two days is all you’d need to do such a simple project. It ended up taking a week.
The next meeting you say two weeks just to be sure. Everyone nods gravely, upset that something would take so long, but the work must be done. Two days later you sheepishly wander into the manager’s office with a completed project. He looks pleased but confused. The next meeting, he insists that you can do it in half the time. You and your fragile pride bowl ahead only to deliver late. The mystery!
This was my life until I started bugging the more experienced around me. I learned a lot from them and I ended up distilling it down into a few rules.
- There Is No Other Unit Than Hours
- Be honest.
- Get Granular.
- Promise a Range. Give a Deadline.
Why does someone want a time estimate? What are they going to do with this information? When working on a contract job it often feels like sticking a foot in a trap when a time estimate is given. Are they going to hold me to this? What if it goes wrong? After all, we are not fortune tellers. Unless the manager is extremely bad or you show yourself to be extremely lax in your duties, it is unlikely that a time estimate will be used against you.
Continue reading “Life On Contract: Estimating Project Time”