Naturally, these goals will change and evolve over time. Your circumstances or interests might go in a different direction, or an opportunity might present itself that’s impossible to ignore.

You might even need to refocus the targets you set for the business because of the progress you make. For example, if you hit a target sooner than you had anticipated, you may be able to consider more ambitious aims in that particular area. On the flip side of this, struggling to meet a goal can help you identify where you need to invest in new skills, budget, or time.

The formal term for these goals in the world of business is Key Performance Indicators (KPIs).

Here, we explore some general KPIs and business goals you should be setting, as well as how to measure them successfully.
 

What are macro and micro goals?

If you ever need to write a business plan, outlining the goals in your business is a key part of it. They can often be divided into ‘macro’ goals, and ‘micro’ goals.

‘Big picture’ macro goals are critical to the long-term success of your business. These include the bigger decisions and objectives that are going to take more time or money to achieve, such as:

• Ongoing client retention
• Increasing earnings from one year to the next
• Building a more sustainable and secure future for the business

Macro goals are usually set and reviewed on a less frequent basis, such as annually, bi-annually, as even as part of a five-year plan, for example.

On the other hand, micro goals are smaller, more achievable milestones that can be seen as quick(er) wins. These are aims that can be reached in the near(er) future, often with a less intensive investment of time and money.

Examples of micro goals could include things like increasing your social media following, setting out to capture more customer data, or immediate cost-saving exercises to improve cash flow.
 

Different types of freelance business goals

There are a whole host of different goals you can set for your business and many of them will depend on your individual circumstances.

If you’ve been working from home at your kitchen table for a long time, you might aim to start hiring a spot at your favourite co-working space a couple of times a week. Another target could be to clear your debts by the start of the following tax year.

Business goals are all about where you want to go and how you plan to get there. That said, there are some general types of goals and KPIs you should work towards to set your freelance business up for success.

Financial goal setting for freelancers

It goes without saying that you’ll want to set some financial goals for your freelance business. Below are some ideas to point you in the right direction.

• Revenue: Set clear goals for how much money (total income) you want to make by a set period of time, whether that’s per quarter or per year. This will help you work out the volume of sales you need to make to achieve that target.
• Net profit: Making lots of sales is one thing, but high costs can damage your ability to actually make a profit. Review your figures, and create a plan to achieve a certain amount of net profit once all the necessary deductions have been made and let this influence your strategy.
• Cost saving: Savings goals are key for businesses of any size or structure and can be managed on both macro and micro scales.
• Investment and funding: If you plan to invest your own money or secure funding for your business, add this to your financial objectives. It will help you understand what you want the funding for, and how you will use it (which any lender or investor will want to know too!).

Customer success and client retention

One of the other ways you can steer your business strategy and set performance-indicating goals is by monitoring customer success and retention.

This simply means setting a goal for how many clients or customers you want to acquire, and then setting additional aims around how you plan to work with them all, and retain them.

The goals that you set for taking on new customers will usually overlap with your marketing goals, for example. It might sound a bit corporate for one freelancer working alone, but the principle is still the same!

Marketing

If you choose to execute a marketing strategy to promote your business and maintain an online presence, there are a number of marketing KPIs you can measure your digital performance against. Common marketing metrics include things like:

• The number of people who visit your website, profile, or page
• Click-through rates and conversion rates, to understand what actions people take on your page or profile
• Number of social media followers, and the volume of interactions on specific posts (which helps you understand what sort of content your audience likes!)

And many more! Under the marketing umbrella, you should also set yourself some networking-related goals. Think quality over quantity and only attend networking events, whether online or offline, that are truly going to boost your business in some way.

Professional development

As a self-employed freelancer, your skillset is your business. You don’t have a workforce of staff with different expertise to diversify and expand your offering for you.

That’s why it’s so critically important, when you run a freelance business, to ensure personal professional development goals are high on your priority list.

How you go about this will depend entirely on what you do. Professional development for a freelance photographer, for example, looks a lot different from professional development as a private chef.

Whatever your niche, set goals for improving and expanding your skills on a regular basis – and stick to them. This will help you stay relevant and competitive – two essentials for growth and success.

Personal

It’s also important to consider personal goals outside of your working life. After all, you can only do your best work and optimise the potential of your freelance business if you’re a happy, healthy version of yourself.

Good examples of personal goals you could set include:

• Take up a new non-work-related hobby
• Spend more time with friends and family
• Pursue passions that get you outdoors and away from your screen or workshop more often
• Exercise regularly to improve both physical and mental wellness
• Plan a holiday or a break away from work to rejuvenate and reset
• If you’re feeling burnt out, put a plan in place to reduce stress and strain, such as figuring out how you could work fewer hours but still be productive, for example.

Personal goals like these will help you strike a good work-life balance and nurture your non-professional relationships too.

Measuring KPIs as a freelancer

Once you’ve set your goals, the next step is understanding how to monitor them. You need to keep track of goals and KPIs meticulously so you can use their progress or performance to inform your next move.

Here are some great ways to measure the success of your freelance business goals:

• Use your business plan to track your performance against your proposed timeline
• Client retention and how satisfied your customers are (qualitative), alongside how many new customers you acquire (quantitative)
• Profit, revenue, and your overall financial status
• Marketing metrics such as return on ad spend (ROAS), website traffic, or social media following
• Skills, qualifications, and certifications
• How happy, healthy, and productive you are as a professional freelancer

 
Find even more advice and guidance for freelancers in our info hub!

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For those who still aren’t entirely familiar, an influencer is somebody with a large (and loyal) online following who has the power to influence sales of products and services—hence the name.

You’ll typically find influencers on social media platforms like Instagram, YouTube and TikTok but ‘influencing’ also extends beyond the most popular platforms into more niche parts of the digital world too.

Is being an influencer a ‘real’ job?

Yes, absolutely. In fact, according to a recent study by Adobe, UK social media content creators are now earning an average of £137,000 a year.

This is significantly more than other average salaries shared by the UK Government’s National Careers Service:

• Solicitor – £100,000
• Software developer – £70,000
• Accountant – £65,000
• Train driver – £65,000
• School teacher – £42,000
• Firefighter – £32,000
• Nurse – £32,000

Although some traditionalists might snub the idea of ‘influencing’ being a real career, the potential earnings mean it’s fair to say that it’s an extremely valid and lucrative way of earning a living.

Plus, while it might look easy and glamorous at times, producing the kind of digital content that engages an online audience so effectively that you can turn it into an income stream takes a great deal of time and skill.

The growing appetite for influencer marketing

Not only does influencing have the potential to be an extremely profitable income stream for the content creators themselves, but it can also have a powerful impact on the success of the brands and businesses they’re affiliated with.

According to research published by The Social Shepherd, 93% of marketers said they had incorporated influencer marketing as part of their overall strategy. This means almost all of those surveyed had worked with influencers and content creators to:

• Raise brand awareness (86%)
• Reach new or targeted audiences (74%)
• Improve brand advocacy (69%)
• Increase sales conversions (46%)

The same study found that 61% of consumers say they trust influencers’ recommendations. With a statistic like that, it’s clear to see why so many brands and businesses rely on influencers to help grow their digital presence and boost the bottom line.

What do you need to be an influencer?

Technically, anybody can become an influencer. Due to the fact influencers can run their business anywhere in the world with an internet connection, it’s actually a super inclusive and accessible way to make money.

Plus, with free access to social media platforms and advanced smartphone technology, great potential really is at our fingertips these days.

This applies whether somebody is a full-time influencer or if they influence on the side to supplement an employment salary. It also applies whether somebody is an influencer with hundreds, thousands, or even millions of followers, or if they are what is known as a ‘micro-influencer’, somebody with 1,000-10,000 followers.

Unlike many jobs, you don’t need any specific qualifications to be an influencer and the nature of the role is extremely diverse and expansive. Age, experience, and location are some major factors that often determine access to ‘regular jobs’, whereas influencing is open to anybody who wants to give it a go.

That said, there are some areas which might be worthy of consideration becoming an influencer as a way to generate income, including:

• Have a niche area that you specialise in and build your content around that
• As well as having a niche, have a target audience that you want to reach and engage
• Stay on top of your social media skills and the latest trends so that your content stays current
• Make sure you have time to post regularly and interact with your audience, as well as liaise with the brands you work with
• Be consistent—sporadic posts aren’t the way forward if you’re going to make a successful business from your online content
• Analyse how your content performs closely so that you can do more of what works and less of what doesn’t. This requires some knowledge of analytics platforms, most of which are now integrated into the digital platforms themselves.

The pros and cons of being an influencer

Below are some of the advantages of the role, as well as some things to consider. It’s important to remember that influencing isn’t just about getting nice things for free and editing Instagram reels in your PJs.

The benefits of being an influencer

• You have complete flexibility and autonomy over your own time
• As with all self-employment income streams, any post-tax profit you make is all yours to keep
• For people who are passionate about this line of work, it can be a whole lot of fun
• You have the chance to positively influence a large audience and make a real difference
• You get to try products, visit places, attend events, meet new people, and have experiences that you might not otherwise be exposed to
• Start-up and overhead costs can be super minimal. All you really need to get started is the smartphone that’s probably already in your hand right now.

Some things to consider

• Just like with any form of self-employment, you are responsible for generating your own income
• Similarly, you are also responsible for reporting and paying your own tax
• As influencing is so inclusive, this means that the competition is high too
• There isn’t necessarily as much job security as with salaried employment
• Even though it’s a lucrative industry right now, nobody knows the future of influencer marketing
• You may well need to share a part of your life with the world online, and sacrifice some of the privacy and anonymity regular employees or self-employed people have

Think a career as an influencer might be for you? There’s only one way to find out! Head over to our hub to find more information and support for freelancers.

The post Can I Be An Influencer? appeared first on Freelancer News.

The choice is yours, and freelancers don’t need to register as one particular structure over another, but it can be difficult to work out which option is best, especially if you are new to freelancing, in which case our guides and resources for freelance accounting might help!

Different business structures can have a big impact on how you operate and the way you pay tax, so it’s essential that you fully understand the potential benefits and implications of your decision.

While we always recommend seeking professional advice specific to your personal circumstances, here’s an overview of how limited companies and sole traders operate.

Freelancing as a sole trader

The natural step for most freelancers is to register with HMRC as a sole trader, and make Self Assessment tax submissions to tell them about their earnings. It’s less formal, but this also means there’s no legal distinction between you and the business.

In one respect this makes things like paying yourself a bit easier, because you can just keep any profits, but this also means you’ll pay tax on those profits even if you don’t take them out of the business.

The other side effect is that it also makes you personally responsible for running your business. Any liabilities, losses or debts all belong firmly to you, and not just to the business.

Can sole traders hire staff?

Despite the name, you can hire staff as a sole trader, so if your freelance work really takes off you can employ someone else (or outsource it out to another freelancer).

Can I be a sole trader freelancer and still work for my boss?

Don’t worry, sole traders are allowed to do self-employed freelance work as well as working for an employer – in fact it’s pretty common! And no, your boss doesn’t have to know that you’re working on a side hustle.

It’s also worth noting that the trading allowance means you can earn up to £1,000 of self-employed income in a tax year before you need to register with HMRC.

Pros of freelancing as a sole trader

• A straightforward Self Assessment taxation system
• Flexibility to incorporate the business as a limited company at a later date if you want to
• Greater privacy as your name and details are not published by Companies House
• Cost of compliance and tax returns are usually cheaper
• Cheaper to close the business

Considerations for freelance sole traders

As the business grows over time, there may be a point when operating as a sole trader limits the potential of the business, depending on the sort of projects you deal with. So while it’s easy to become a sole trader and also to stop, it can have its drawbacks.

Another common issue is tax efficiency. Sole traders pay income tax on all of their profits, even if they don’t actually withdraw them from the business for personal use. Limited companies pay Corporation Tax, which is lower than income tax, and then you’ll pay personal tax on any income that you pay to yourself. So, depending on how much you earn, it can be more tax efficient to operate as a limited company.

The other common consideration of being a sole trader is personal liability. If your business were to incur debts or losses, then you would be solely responsible for these, not the business.

Freelancing as a limited company

Setting up a limited company (known as incorporation) means you’re creating an organisation which is totally separate to you personally in terms of its legal identity and financial activity.

Some freelancers prefer this because it means the business is separate to them personally, which means any debts or liabilities won’t be a threat to their personal assets.

Limited companies do need to register with Companies House, and the details of all key members of the business, including directors, will be publicly available. The process is a bit more formal, and this has an impact on tax and reporting requirements.

If my company is a separate entity, how do I pay myself?

Freelancing as a limited company rather than as a sole trader means the way you pay yourself also changes. Most of the time it’s more tax efficient to pay yourself a combination of a salary, and then take dividends (which incur tax at a lower rate).

The flipside of this is the extra admin.

• The limited company must submit a Company Tax Return and pay Corporation Tax.
• Then, if you take a salary, your company must register as an employer, and pay you through PAYE.
• If you take dividends as well, then you’ll also need to register for Self Assessment too, so you can report this income and pay tax on it.

If my company is a separate entity, how do I pay myself?

• Easy and cheap to set up
• Limited liability, so your personal assets have more protection
• More options for tax efficiency
• The ability to bring in multiple shareholders or directors
• Can add business credibility
• Your company’s legal name will be protected, making it harder for other businesses to pretend to be you

Considerations

As you might expect with a limited company, there is going to be more administration to think about. It’s also worth thinking about your ongoing freelancing plans.

We say this because dissolving a limited company is not an easy process, and you can’t just deregister and walk away in quite the same way that you can as a sole trader. If you wanted to close the business altogether then the winding up process is a bit more involved.

Existing sole traders looking to switch to a limited company should also be aware that some mortgage lenders will consider this a new business, even if you have a long trading history as a sole trader. It’s perfectly possible to get a mortgage as a freelancer, but you may need to seek specialist advice or face having your mortgage application delayed if you are not already on the property ladder.

So which should I choose?

As with all other aspects of running a business, there’s no clear-cut answer as to whether registering as a limited company is the right move for you. Instead, you must consider your business objectives and financial goals.

In either case, there is no getting around informing HMRC that you operate a business as a freelancer, including reporting your earnings and paying tax. It’s why becoming a sole trader is often the first port of call for freelancers, but that doesn’t mean you have to continue as a sole trader forever.

Read our guides and resources for more help and advice on becoming a self-employed freelancer.

The post Do Freelancers Need To Register A Limited Company? appeared first on Freelancer News.

With so much to consider, it can be hard to know where to begin and easy to get lost. So, with that in mind, we’ve put together this simple guide to run you through the key points.

Knowing your worth

When considering your rate, the best place to start is by understanding your worth within the market. Are your skills in demand? Is there a lot of competition in your field?

The value of your specific skills is a great starting point to help you determine the price point to charge your client. Your qualifications, expertise and experience all make you unique, and help you stand out from the crowd.

If you can demonstrate the proficiency of your skills (perhaps through a portfolio of past work or positive reviews from previous clients), you will be able to prove your worth and justify charging your clients a higher rate.

Always remember what keeps you in demand with your client. You have a lot to offer – don’t sell yourself short. Remember, your years of experience and knowledge are reflected in the fee.

Industry trends

One of the many benefits of being a freelancer is that your rate is never fixed. Always be aware of growing trends in your industry. Regularly re-evaluate your own rates to reflect the industry standard.

• How much does your competition charge?
• Are they cheaper or more expensive than your own rates?
• Perhaps most importantly, have they changed their fees recently?

Remaining competitive is important, but it can be a difficult balance to strike, especially when competitors regularly change their pricing. Try not to undervalue yourself. Charging lower rates can lead to missing out on potential earnings, and might even put some clients off if they think you’re not good enough.

As a rule, clients normally expect to pay more when using freelance services. When proposing your rate to a client, communication is key and their feedback is important. Listen to what they say and pay close attention to your pricing.

When freelancing, no two projects are ever the same. Each job is unique and brings its own trials and tribulations. Always consider any additional specifications of a project in your fee. If there is a strict deadline or greater complexity required, this will naturally demand more effort from you.

Your time is precious, and so the projects you work on need to be worth the effort, whether that’s financially, or in terms of growth and opportunities. Don’t be afraid to reflect this in your fee.

Should I charge per hour or per project?

When determining your rate, there are a number of pricing models to consider, such as charging an hourly rate, or quoting a project fee. The difficulty is that:

• Clients usually want an idea of how much something will cost beforehand
• You don’t want to undersell yourself
• You don’t want to price yourself out of the job

It’s a balancing act, and there are pros and cons to every charging method.

Hourly rate

Charging an hourly rate has the benefit of simplicity. You only charge your client for the hours you work to complete the project. This pricing model is common among upcoming freelancers and ideally suited for service-based projects. You’ll still need to give clients an idea of how long you expect something to take, though! Plus, if it looks like you’re going to significantly go over the time quoted, tell them in plenty of time.

Charging per project

Alternatively, some freelancers prefer offering a fixed rate per project. For long-term assignments with clearly defined client goals, this can be a perfect fit. When you can’t provide a definitive timeframe for a project’s completion, offering a fixed rate to clients can be more appealing, as it helps them manage their budget more efficiently.

There is no right or wrong method, so experiment and find which pricing structure works best for you.

Paying your bills and covering costs

Another important consideration in deciding your rate is the cost of your bills and outgoings.

• How much money do you need to earn to support yourself and your family?
• What is your annual salary goal?
• Will the project require any supplies, equipment or specialist software?

It’s your responsibility to ensure that your hard work empowers your lifestyle and that you are able to keep your business afloat.

Always factor in the cost of running your business, and check your financial reports to make sure you’re on track. Every freelancer has their overheads, whether it’s purchasing new hardware, renewing a software subscription, or marketing. These necessary costs need to be accounted for, and factored into your rate.

Don’t forget your tax bill

If your self-employed income goes above £1,000 in a tax year, you will need to report this to HMRC. An important point to note is that this is based on income. You’ll pay income tax and national insurance on your profits. Keep this in mind when you’re working out what to charge your clients!

You can make the most of your profits by hiring an accountant to assist you with claiming expenses, improving your tax-efficiency, and paying your tax bill on time; but you will need to pay for their services too. Even so, finding an affordable and skilled accountant can be a real boost to your take-home pay.

Considering cashflow

In life and business, preparation is the key to success. Having a solid cashflow strategy is essential to support your business and a keystone in setting your freelance rates.

How much you charge determines your ability to prepare a financial safety-net for those quieter months. Business costs can arise at any time, and you need to be prepared for when they do.

To keep your cashflow running smoothly, always ensure you have a written contract with your clients. This helps prevent miscommunication and, if you include payment terms, gives you a time-frame within which you can expect to be paid.

After completing a project, invoice your clients correctly and on time. It is your responsibility to ensure you are paid correctly and in a timely fashion, and communication is key.

To avoid anyone forgetting to pay you, send payment reminder letters or emails when the agreed payment deadline is near. If a repeat client is proving difficult, you can always withhold your services until any outstanding bills are paid.

Factor in the hours you won’t get paid for

When you are a freelancer, you don’t have a team to fall back on, and the success of your business rests solely on your shoulders. We don’t mean to sound scary, but like all good things, running a business takes time.

To keep things running you’ll inevitably find yourself spending a lot of time sending out invoices, building client relationships and replying to emails. Whilst this administration is important, it’s also non-billable time.

With each project, do your due diligence. Consider how many non-billable hours will be required to complete a project and factor that into your rates. It might be worth looking at tools or software which can help automate some of the more time-consuming aspects.

Life can be unpredictable, too. When you run your own business, factor in the possibility of sickness or other unexpected absences. On the days you are feeling worse for wear, you might need some downtime to recover. It’s sensible to account for several sick days in a year, as its better to have them and not need them, than to be stuck working when you’re feeling run down.

One of the biggest advantages of being a freelancer is you have the freedom to take time off whenever you wish. You don’t need to request it, but this flexibility comes at a cost.

You might not get paid holidays, but taking some time away from work is well deserved and essential for your health and mental well-being. So don’t forget to factor this into your pricing, either!

Find more guides and resources for freelancers in our online hub.

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That said, there are a number of circumstances that might mean this isn’t the case, or that there are conditions your employer expects you to adhere to.

 

Why decide to freelance if you’re already working?

Common reasons why some people choose to freelance alongside full-time or part-time employment include:

• Earning extra money to supplement their salary.
• Fulfilling a skill or passion that’s a diversion from their regular day job.
• Using it as an opportunity to learn and practice new skills.
• Having more creative control or professional autonomy over projects they’re working on.

Are you ready to jump straight in?

But why not just take the plunge, and become a full-time freelancer? Well, it’s not for everyone. The decision to freelance alongside employment, rather than instead of it, is often down to factors like:

• Not yet earning enough through freelance income alone.
• Not wanting the pressure of drumming up business or relying on clients to pay on-time, as opposed to a regular monthly PAYE salary you don’t have to chase or worry about.
• Concerns that securing a mortgage or other finance will be made more difficult if freelancing is the sole source of income.
• Preferring the culture of a shared working environment and ‘office life’ (freelancing can sometimes get a bit lonely).

 
So, for some people, choosing to freelance as a side hustle is the most desirable option. Just as long as it’s manageable, and your employer permits it.

To make things as stress-free as possible, and to keep you out of unnecessary trouble, here are some tips on balancing freelance work and employment.

Start by checking your employment contract

Some employers ban their workers from undertaking freelance work entirely. If this is indeed the case, it should be made clear in your employment contract.

So, before you get stuck into any gig work or side projects, make sure you check! You don’t want to breach any rules that might affect your employment status if your boss gets wind of it.

Why won’t my employer let me freelance?

An employer might refuse permission to carry out any freelance work for a number of reasons. For instance, if your potential clients would mean you’re going after the same audience.

For you, as a freelancer, it makes perfect sense to seek out additional work in the same industry or marketplace. After all, that’s where your skillset and experience lies. Understandably your employer might be less keen to have another competitor in the arena!

Be transparent with your employer by putting them in the picture

If your contract doesn’t contest freelancing then by all means, get stuck in but first, have a conversation with your employer. Not because you’re obliged to, but just because it’s the considerate thing to do.

You never know, your employer might even support your side hustle and be willing to discuss things like flexible working hours to accommodate it.

The best working relationships begin and end with open, honest lines of communication so we always recommend keeping your employer informed.

Make your freelance clients aware of your other commitments

On the flip side, as well as keeping your employer in the picture, it’s also a good idea to be honest and transparent with your freelance clients too.

Although it can be tempting to conceal your employment commitments, making your freelance clients aware of your working hours and realistic availability will help manage expectations on both ends. It will also help make sure they’re setting you attainable deadlines and ensure that you don’t end up spread too thinly or completely burnt out.

Acknowledge when the balance becomes too biased

One final word of advice before we depart is to stay abreast of how the balance is tipping. You don’t want your work in one area causing you to underperform in another.

You can’t let your freelance work detract from your day job (in time or energy) but if you’re passionate about, and inspired by, your extracurricular projects? Then you shouldn’t let employment completely bulldoze that either.

If you notice a bias starting to develop, it might be decision time. Perhaps you’re ready to take the risk and go full-time freelance. Or alternatively, you might need to scale back your side hustle to improve your wellbeing and health.

If you’re considering freelancing, check out our article for things to consider before you get started, or check out our support hub for becoming self-employed.

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