Reason why I'm glad I'm self-employed #246

In short I can't make myself redundant.

I can still remember when I was an employee and redundancies happened. They crept up on you, suddenly a colleague would be called into an office in another part of the building and return blotchy faced with a personnel security guard.

Before child we also experienced the corporate way of culling staff from my husband's employer. The trend seems to be to decide a certain job description or level of employee as no longer existing (though a similar job title or level is about to be launched and he's still working 60+ hours a week). He has survived this cull twice with little stress on our part. Three weeks ago we discovered this is happening again. It is still 6 weeks until we finally know and even if redundancy is his fate he is employed until after Christmas - did I mention he works for a large supermarket chain?

The difference this time is 1. we have a child and 2. I don't have a secure income. At the moment we are assuming that everything will be okay whilst also thinking about his options next year if the worst happens. He has been with the same company for 17 years - all his working life so there could be some interesting things put forward over the next few weeks. I've already discounted professional amateur golf player, professional fisherman and online poker supremo - any ideas/offers most welcome.

Late Payment Charges

(Image from freeimages.co.uk)

The time has come to get serious with one of my clients. For the second week running I've received an email asking me to be understanding as they can't pay my invoice due to 'insufficient funds' (a phrase I'm about to hear from my bank).

The invoice isn't for a great deal but 6 weeks ago when I completed the job and raised the invoice I'd been working long hours to get the project finished within a tight time frame (I had to turn it around in 5 days).

At a colleague's advice I added the following to the bottom of my invoices about 18 months ago:

Payment within 30 days please.
I reserve the right to claim statutory interest at 8% above the Bank of England Base Rate from the date the debt becomes overdue in accordance with the Late Payment of Commercial Debts (Interest) Act 1998 and to claim an additional sum for pursuing the debt as provided for by the Late Payment of Commercial Debts Regulations 2002.

Usually referring to this is enough to ensure that timely payment is made but not in this case so I'm having to follow through for the first time.

There are detailed instructions on how to calculate the interest bit here. At the moment it is 13% of the amount owed, divided by 365 days, multiplied by the number of days overdue - which doesn't look like much really.

But I can also claim compensation arising out of late payment £40 (more is due if the original invoice is over £1000). Which should just about cover any charges by my bank due to insufficient funds.

I will let you know how I get on with this client - they are usually quite good and at least they have let me know the situation rather than hoping I don't notice.



I'm assuming there is similar legislation in other parts of the world - do you find that small businesses or sole proprietors tend to be taken advantage of by larger companies in this way?

Three Year Anniversary

The end of this week marks my third anniversary of being a freelancer. Woo hoo!

I remember, back when I first started out, reading a post on a forum detailing some guy's hours worked, money earned and percentage increase on last year. Why would someone want to read all that (he also regularly posts his marketing strategies as in 'today I sent out 500 letters advertising my services - I'll let you know if I get any work from it' - he didn't ... get any work that is, he did in fact tell us all about it)? What's the point of noting it all down? Isn't it a pointless exercise?

But I must have taken something from it as I did start to note down my hours and the page count of projects - which has proved invaluable in quoting for new projects.

So why am I about to do to you now what he did back then (and I'm expecting him to do again in a couple of weeks time)? Because it IS a worthwhile exercise - I'll try not to do it in an 'hey look at me aren't I great' way. It has helped me to judge where my priorities are, where my weaknesses are and what to improve on in the future. Most importantly it helps me to prove to the OH that this freelancing lark is better than minimum wage down the supermarket - just.

In short this year I have worked 90 hours less than last year - understandable as I've had a week in hospital, a week cut off by flooding AND 3 weeks holiday. But still 150 hours more than I worked in the first year - with a newish baby and a house move.

My income has increased 12% on last year - so despite working less hours I have taken more money, this is due to rising to advanced membership of the SfEP and working for more varied clients. Overall it is a 23% increase on the first year.

I have yet to work out my outgoings but expect that my increased advertising and society membership costs will even out against the conference and courses I attended last year.

My hourly rate dropped by £2 last year but has increased by £3 this year - again this is due to clients - last year I did a lot of 'test' work for new clients who then turned out to have a really poor rate after the test was over. It's still not in the realms of where I would like to be but I've had better paying clients this year and now know what I CAN achieve.

My average number of hours a week is 20 - which as a part-timer is just about right - but bearing in mind the amount of time I've had off this year and the dry spells I've had this has meant several weeks have been closer to full time hours (a few weeks saw me log over 40 hours). This year I have also made more of an effort to work during the day in my child free hours and spend family time in the evenings - though some days I work right through.

For me this is a worthwhile exercise as although I know I just about scrape to pay the bills each month it is nice to know that my little fledgling business is going in the right direction.

This year is the first time I've logged my hours week by week and this has led to a surprising outcome - it has become very clear that traditional 'holidays' are very busy for me - my busiest months were August, November and January (with December coming a close second) my leanest months were April and June. It will be interesting to see if this is a trend in the following years - I always suspected that it was the case that desk editors ship everything out before they go away so that it will be 'miraculously' finished for them by the time they get back (I used to be one so I know that it is true ;-)).

If you are still with me - well done for hanging on in there! I promise I wont bore you with my tax return ... much.