While I was in the building out a comprehensive article about invoices for freelance writers, I ended up touching on five high-level pointers.

More strategic than tactical, they warrant a post of their very own. If you were to think about the holistic health of your freelance writing business, then the pointers relate more to general nutrition than to specific exercises at the gym.

You might have heard this about nutrition: “Garbage in, garbage out.” The same holds true for the practices that guide your business.

I’ve found that sloppy invoices belie sloppy thinking about money: your relationship with it; how it moves through your business; how you talk about it; how you use it as a lever; and how if you don’t use it, it uses you.

Of course, by bringing up invoices and money I run the risk here of putting all you freelance writers to sleep. If you’re anything like me, you passed your time in accounting class in high school dreaming fondly of lunch: “Maybe it’s pizza day!” Invoices seem insignificant. They seem like a receipt for a cup of coffee that you crumple up and throw away.

Be that as it may, certain small components of your business structure, invoices included, speak volumes about the underlying structure and hidden rationale.

business structure for freelance writers

Photo Credit: Clem Onojeghuo via Unsplash

Shrewd thinking and sound processes do a sustainable business make.

These five practices may not engage your creativity and intellect like brainstorming sessions with clients or the writing work itself.

But they do serve as cement for your writing business. You have to have a strong foundation, or your business will be rickety, no matter how flashy your writing skills.

Please, please, please buckle down and grab hold of them.

1. Say no to free work.

In terms of not getting stiffed, let’s start with the most obvious scenario.

Somebody will, at some point, ask you to do free work. Maybe they’ll tug at your heart strings and explain how cuddly kittens will perish if you don’t write an appeal letter for the local animal shelter’s fundraising campaign.

Fine. Write the letter.

But hear me on this point: Do not work for free unless you 1) maintain absolute creative control, and 2) really care about the person or cause.

Jackanapes who try to coax you into working for free by offering you a portfolio piece overlook the obvious: You’re a writer. You can create a “portfolio piece” anytime you like by sitting down and writing something.

Of course, the conversation is rarely cut-and-dry. People paint the pathos on thick. They use bad business pickup lines like “I can refer you a ton of business” and “If you can help me out this one time, then I’m sure we’ll have more opportunities to work together in the future.”

Look past the regrettable situation—whatever it is—and the plaintive pleas, no matter how ornate and persuasive—and the cozy promises, and cut straight to the bone: If they value your skills so much, they should pay for them.

Is the other person accustomed to working for free? No. And neither are you.

Allow me to tie on my cape and masquerade as Captain Obvious for a moment… Clients should pay you for your work.

Your level of experience is immaterial. Your apparent “need” for portfolio pieces is a non-sequitur.

You are not running a charity. You expect to get paid for their work, and they are welcome to come back when they have scraped together a budget.

Phew. I feel better. And I hope you’ll heed my advice. Only do free work if you already cared about the cause, and only then, if you choose the parameters and maintain absolute creative control.

Otherwise, you will end up feeling like someone took advantage of you. But really, you gave them the advantage in the first place. You said yes when you could have said no. Say no to free work.

2. Stop cringing.

Everybody gets paid something to work. There’s no shame in needing money, and there’s much to be gained, both in terms of reputation and income, by charging a premium for your freelance writing services.

So try not to flinch when you talk about your rates. Keep your chin up. Be PROUD of what you charge. When a client wants you to come down on price, say, “No problem. What would you like to remove from the scope?”

If they’re paying less, you’re doing less work. Your rates stay the same regardless. No discounts simply because they didn’t like your quote.

A brief caveat about money… If you tend to cringe when the conversation turns to money, then you spend time pondering why that is.

What is the root cause of your reaction?

Dig down and try to wrap your mind around your relationship with money. You will find it very difficult to sell your services effectively if you’re always dodging the money conversation or if you capitulate anytime a client tries to dicker over the price without budging on the scope.

3. Get paid in cash.

Don’t do writing in exchange for equity.

Ninety-nine out of a hundred clients don’t offer this option unless they’re either stupid or cash-poor. Neither trait is attractive in a client.

Think about it. Business owners and startup founders only offer equity if it’s worth … drumroll… nothing. In fact, many people who toss around the term “equity” have no idea how it actually works.

Equity is supposed to have real value. Having equity, or shares, in a legitimate company is like having a duffel bag stuffed with money that you can’t spend yet.

A sensible business owner would only offer a duffel bag if your contribution will make him or her more money than the equity is worth.

Your work should multiply duffel bags for everyone involved.

Now you understand why casual conversations about equity are highly suspect.

Seasoned founders and sensible owners much prefer to pay in cash rather than equity. We’re talking about their companies, their babies!

To how many people have you offhandedly offered a percentage of the future profits of your freelance writing business?

Exactly. You just don’t do it unless you really respect the person’s work and trust that person to deliver significantly more value than the equity represents.

In short, 99% of work-for-hire gigs where the client proposes to substitute equity for cash compensation will end in chump change.

You will be the chump.

Be rest assured that you can have a good script ready:

“Sorry. I’m not accepting equity right now for tax reasons. I am accepting cash compensation. Here are my rates.”

If the client counters with a cash-plus-equity agreement, then meet with a CPA. Only accept that agreement if the cash alone still makes the project a winner.

There are definitely nuances that I’m glossing over here, but the underlying principle stands: Getting paid in cash is less risky and less messy than receiving part or all of your compensation as equity.

More importantly, very “yes” to one client is a “no” to a better client down the road.

4. Require a deposit.

Non-payment situations happen. Unscrupulous clients have been known to disappear after they get the finished project before they have paid you.

You can keep everybody honest by not kicking off the project until the client has paid the deposit—by “paid” I mean you have a check in hand or an email confirmation from PayPal or Stripe.

On occasion a client will complain about having to pay a deposit, especially when I make it clear that I won’t start the project until I receive it.

But I have seldom, perhaps never, lost a project by requiring a deposit.

The fact is, if you’ve gotten far enough along with the client that you’re even discussing payment terms, then it is painful for them to go find someone else and restart the process.

For most projects, I require a non-refundable deposit (aka, down payment) of 50% of the project total.

Or, if the project total is $5,000 or less, then I require payment in full up front.

The outstanding balance I address in the payment schedule in my client service agreement. For example, if my fees totaled $6,000, then the deposit would be $3,000, I specify that the client will cover the remaining $3,000 in two payments of $1,500 each—30 days and 60 days after the project commences.

Note: I do not wait to get paid in full until we finish the project.

I’ve been in too many situations where a client’s delays were, in effect, holding my money hostage. I had to keep putting pressure on the client to give me feedback. Too much pressure, and the client starts retreating from the project and the relationship. You’re trying to help them finish a project they thought was important and here you are becoming the annoyance!

You can avoid this situation altogether by separating payment from project status. Tie payments to specific dates instead, and if the client drags their feet or goes on sabbatical in Bali, then it’s no skin off your back.

You’ve got your money, and you’re happy to work on their timeline (or lack thereof).

In the event that the client decides to cancel the project, I’d recommend a “kill fee.” I once had a client cancel a project AFTER it was finished. Riddle me that. You bet your bacon I wished I had a kill fee in that contract.

Clients usually try to cancel because of buyer’s remorse, not negligence on your part. Kill fees help to “persuade” them to finish the project.

5. Always use a contract.

Get the terms in writing before you invest your precious time in a project. Don’t start working until both parties have signed the contract.

In my experience the only people who gripe about contracts are the ones most likely to screw you over. Sad but true. “Surely, we don’t need a contract?! Hahahah. How about we do this first project on good faith? I’ll mail you a check when it’s finished…”

And so on.

Yeah, those sentiments would be appropriate if we all lived in Shangri-la. Ask any shrewd businessperson you respect how long he or she got by on handshake agreements.

In the early days, I was naive. I never suspected of other people what I wouldn’t do to other people. But other people are happy to con a young freelancer by making appeals to his or her integrity.

Insisting on a mutually binding contracts doesn’t make you the suspicious one. It makes you smart.

All moralizing aside, people are more likely to be on better behavior if a solid contract shackles them with legal liability if they behave badly.

Contracts are a precaution, not a pronouncement on the other party’s trustworthiness.

A client who puffs up with indignation when asked to sign one is not a client you can trust farther than you can spit.

Sawdust

I hope you found this post helpful. If you’ve got any questions about high-level stuff, leave them in the comments section below.

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