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Contractor earnings: How to maximise them

Contractor earnings ought to match skill set and value. If you are working as an independent contractor, it is important to ensure that you are providing your services within an industry where your particular skills are in demand.
3 minute read

The basic premise of offering your services to any company is that you are doing it to make a living. Maybe you do it for the love of the work? Generally, you will have chosen to go the independent contractor route in order to maximise your earnings. This post will discuss useful ways to maximise your earnings as an independent contractor.

Develop your skill set to improve contractor earnings

Generally, a hiring manager will be weighing up applicants experiences and skills against other potential contractors in the running. If you have taken the time to develop your skills, you will more than likely stand out. Anyone can embellish their past role titles, but the proof is in the pudding. Ensure that you have completed development courses documented, a portfolio and a summary of any CPD points you’ve earned.

When the potential client has narrowed it down to two contractors, one of them being you, your proven skills and additional qualifications will speak for themselves. Not just because of what you have completed, but because of the demonstrable dedication to your chosen career path shining brightly through. Candidates with extra skills who have focused on regularly updating their knowledge can typically also command higher rates.

Reach out to new leads sooner rather than later

When meeting a new contracting lead, it’s advised to get in touch with them within a couple of days again. Stay fresh in their mind and cement that first meeting. Make a further positive impression by providing details on your skills and why you think you might be suitable for the role will stand you in good stead. Not only does it confirm your interest and put your name firmly on their radar, it shows initiative and determination. These are good traits for an independent contractor to have!

If you don’t hear back after you have reached out, don’t be afraid to follow up. It could very well be your next lucrative and long-term contract. Create a reminder note a few days after the first attempt to connect. This could be a calendar notification, a scheduled email to yourself, or open a task within Asana and set a specific due date. It doesn’t matter how you remind yourself, just ensure you follow up once or twice if you don’t hear back.

Sometimes potential clients may are busy and don’t replying timeously so just need a nudge before discussions progress. As a general rule, if there is no response after the third connection attempt, try one more alternative method. If that is still unsuccessful, it’s time to move on to the next possible lead. Here are a couple of links to helpful articles if you find yourself in this situation: Leads not responding? Send this email! and The Complete Guide to Finding and Getting Clients for your Consulting Business, From Finding Prospects to Sealing the Deal.

Focus on pitching your value rather than your pricing

Have you ever felt extremely annoyed when a potential client haggled with you on price and you began to think that they have no idea the value they will be getting from you? Well, you are not alone. Numerous contractors raise this as one of their main gripes. With the number of available contractors in most industries fighting it out to win contracts at an all-time high, it has never been more important to ensure your proposal comprehensively demonstrates your value.

Clients can pick and choose and they can cut costs dramatically by appointing an independent contractor who has gone in low with the intention of winning the project out from under other contractors. But many clients are aware that a contractor who comes in lower than others is possibly not very busy and not in high demand. There is also a general understanding amongst clients that these types of proposals are possibly not going to completely fulfil the project brief – or at least not to the highest quality standards.

As long as you are clearly presenting what you can bring to the table and how you will be able to assist them in comparison to other contractors, you should notice that you are able to set your rate at the level of what you know you are worth without clients questioning it.

Create a financial forecast and update it regularly

Have you ever had a fantastically fruitful second quarter only to have a questionably quiet third quarter? If you are nodding your head in agreement, it’s time to cast your mind to the future. Of course, you should take some hard data into consideration, but in most cases, if you have worked as an independent contractor for some time, you will be able to compare current periods to previous periods. This is a crucial part of admin that every independent contractor should be doing on a regular basis. Not only will it enable you to plan your workload and finances, but you will have a much clearer idea of how much or how little networking you need to do and what potential clients to set your sights on – and when!

Putting together a financial forecast yourself as an independent contractor needn’t be difficult or time-consuming either. A basic Excel spreadsheet works well and means you can continuously update it to reflect the reality which further improves forecasting to provide you with phenomenal foresight. If you are really serious about forecasting and maximising your income as an independent contractor, it could be beneficial to talk with a financial planner or other industry professional.

Define what you need to do more of to maximise your time

As an independent contractor, it’s a simple fact; time is money. When you are just starting out on your contracting career path, you may find that certain projects and tasks take you longer than average. The more experience you gain, usually, the quicker you will be able to complete them. However, there are certain tasks that you may enjoy working on, while another contractor hates them. Doing more of the work you take pleasure in is the key to enjoying one’s work, but also to doing your work much more efficiently. High efficiency = less time on tasks = maximised earnings.

Final thoughts on contractor earnings

Some other fairly obvious tips include keeping your expenses to a minimum. Be highly self-disciplined and keep up to date with your taxes. We have tried to expand only on other tips that may not be immediately apparent. Whether you work as an independent contractor already or you are reading articles like this because you are considering setting yourself up as one, working for yourself can prove especially difficult because all paperwork is totally up to you. We hope this post has sparked some helpful ideas for ways to maximise your earnings as an independent contractor!

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