In last the post, we talked about how to handle your mental + physical health while running an online business. There were tips from bloggers + entrepreneurs on handling self-doubt or burnout, creating a schedule to work and play, and avoiding comparisons from 6-figure income reports. If you haven’t already, check out 20+ Self-care Tips for Solo Bosses.
Today’s post is all about creating a business/action plan to keep on moving, using a perfect formula to find your niche, and pricing your services. Plus, you’ll learn basic tax and legal tips to keep your business legit, and how to find and attract the right clients.
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freelancer or entrepreneur
turn idea into plan
from full-time to boss
Find Your Niche*
formula for perfect niche
name your blog or business
create an action plan
sole proprietorship or LLC
licenses and permits
taxes and finances
The Whats and Whys
Why do you want to start freelancing? What’s your ideal day as a solo boss? What’s your definition of success? Why now? What do you need to do today/this week/this month to get started + live the good life?
Can one of these 6 Signs You’re Meant to be an Entrepreneur motivate you and give you that push you need to leave the cubicle life behind?
From Idea to Business
Go from “I have an idea” to “I have an online business” with one of these 10 business models.
No clue on what you should do? Figure out what you love to do and how to get paid for it. You can become an Event Planner or Notary Public if you’re a people person. Start off with editorial services like copywriting if you’re a wordsmith. Or maybe pet sitting if you’re good with Fido and Heathcliff. Try those or one of these 51 ideas from Entrepreneur.
For my fellow techies, here are 14 businesses you can start with tech skills, like podcasting, app development, or tech blogging.
Are you still a full-time employee? You can try one of these 101 side businesses while you work.
Find Your Niche
After you figure out what you want to do, it’s time to organize and figure out your biz name:
Mariah Coz of Femtrepreneur created the “Perfect Niche Formula” to get you started. Take your skills and knowledge you’ve gained from school or work + your obsessions and passions (find your passion here) and then create something for a specific audience (e.g., college students, personal trainers, or new moms).
For example, I took my 10+ years of administrative + customer service experience, my web/tech obsession and created Client Care and WordPress services for creatives + non-tech savvy bosses.
Another formula from Elle and Company Design: find a need in your industry and use your strengths to Create Your Own Niche.
Figure out your strengths and how you work by taking one or all of these tests:
How to Fascinate
“Your hidden talents, your highest worth, your unrealized potential – the best parts of you might not have been obvious to you before. But now they can be. And with that knowledge, you can use your Fascination Advantages to grow your life, your team, and your career.“
“Vetted by science, the Plum assessment can credential you for your priorities and identify your strengths. All it takes is approximately 20 minutes to find out what your strongest behavioral traits are, the types of environments you’re best suited for and more importantly, take steps to apply for jobs that offer you the perfect environment.“
“Take our Personality Test and get a ‘freakishly accurate’ description of who you are and why you do things the way you do.“
Now we move on to creating your perfect name for your blog or business with Melyssa Griffin. Use her worksheet to figure out your goals and what your brand will be about.
After you have a few names under your sleeve, it’s time to check if they’re available on the web. Save yourself some time by using Namechk to see if it’s available on all social media accounts and domains for free. Just type your chosen name and voila!
If you’re not using your name (Pics by Chicks instead of Jamie Smith Photography), make sure you register at the US Patent and Trademark Office to protect your name and brand by applying for a trademark.
Choose one of these 3 plans then remix, add, or delete as your business grows:
- Mini Plan – Answer these 4 questions from Kidal of Lera Blog: What are you offering? Who you’re going to sell it to? Why would they buy from you? How are you going to reach them?
- Medium Plan – Try Alexandra Franzen’s 75-word business plan answer those 5 questions.
- Master Plan – Or, from Regina of ByRegina.com, develop a Creative Action Plan to help you make ish happen.
A Creative Action Plan (CAP) is a document that you add to and access regularly that contains action items in 10 key areas of your business so that you always have steps you can take to move forward. – Regina
Now for the boring but required parts of your biz. Please note: I am NOT an attorney or accountant, nor do I play one on TV. Please hit up a professional to get the best advice for YOUR business. Thank you kindly.
Sole proprietorship, LLC, or S Corp?
Most freelancers start out as a sole proprietor and move on to LLC. You can learn more about choosing the right business structure at Freelancer’s Union.
A single member LLC offers the major legal advantage of protecting your personal assets from the creditors of your business. By setting up an LLC, you also avoid paying both personal and business taxes on your freelance income. As a “pass-through entity” all the income and expenses from your LLC get reported on your personal income tax return as the business operator. – Jonathan Medows of CPA for Freelancers
Employer Identification Number (EIN)
Apply for a free EIN online so you don’t have to use your social security number on any business-related forms.
Licenses and Permits
Find your state from this list on Small Business Administration and apply for business license/permit if it’s required for your business.
More reading: “Do I need a business license or permit for online or home business?” from CT Corporation.
Find contracts and other important documents for small business owners, designers, developers, photographers, and freelancers. Tailor it or ask an attorney to go through it for you.
Check out Quickbook’s Complete Guide to Taxes for the Self-Employed.
Bloggers making over $400 a year can learn the ins and outs about blog taxes.
Find out what you can deduct next tax season from Fast Company’s Freelancer’s Guide To The Complicated Mess Of Tax Deductions.
More reading: Tax tips from CPA for Freelancers and the ultimate guide to protecting credit in a freelance and gig economy.
Separate your personal bank account and open up a business account to keep your funds in order and your accountant happy. (A deposit may be required to open an account.)
Or, sign up for a debit card for free from Paypal Business and use it for business purchases and receive payments for your goods and services. (No deposit required.)
Use Mint to keep track of your savings, retirement, and budget.
Use Credit Karma for free to keep track of your credit score. (No credit card required.)
Find your health, life, dental, and liability insurance company from Freelancer’s Union.
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Pricing Your Services
Pricing your services is probably one of the hardest parts when starting your business.
If your prices are low, you ask yourself: “why am I still broke AND tired?”. But high prices make you feel like: “Geez Louise, ain’t nobody got funds for that?”.
Take some notes from Julie Harris Design on How to Charge What You’re Worth:
When you’re really good at something and you absolutely love doing it, it’s only natural to want to turn it into your profession, hence why you became an entrepreneur in the first place! But – often, for passion-focused businesses, we often feel afraid, or unworthy to charge for the products or services we provide when it’s something that we already love doing in the first place. This is particularly true for artists or service based businesses.
There’s a course from Double Your Freelancing about Charging What You’re Worth. It’s a free 9 lesson e-course you should definitely check out.
Once you know which pricing model you’re going to use, find out your hourly rates with Motiv’s Freelance Hourly Rate Calculator or use Creative Live’s How to Calculate Your Freelance Hourly infographic. Designers and developers can use Bonsai’s tool to compare your rates with other creatives in the U.S.
Elle and Company Design has a No Fuss Formula for Pricing your services.
And here are 2 posts on why you should charge what you’re worth – Pricing Happiness: Why You Should Charge More by Arianne of Aeolidia and Why You Should Charge More and Not Feel Bad About it by Alisha Nicole.
More reading: Check out more Freelance Resources on Pricing from Erin Flynn.
You have your biz name and plan, plus you figured out your pricing, now it’s time to find your ideal clients:
5 Ways to be Authentic to Build Trust and Be Lovable Online from Wonderclass.
Find Your First Clients by Regina. Or, use this 3-Step Guide to Finding Clients Who Are a Good Fit for You and Your Freelance Business from Creative Class. Find tips on attracting more clients by Getting Referrals From Clients and Friends from Nesha Woolery.
Learn how to Keep Most Valuable Clients Happy.
Find tips from Kim Lawler on how to keep all parties happy by Setting Boundaries.
More reading: Levo’s Beginner’s Guide to Getting Clients You Want.
Do you have any thoughts or questions for me? Share them in the comments below. And don’t forget to click to tweet and share with your folks or save it to Buffer for later. Thanks for reading!
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This post is Part 2 of 5 for Create Your Dope Biz series. Next post will be on which platform to use (Squarespace or WordPress), branding, styling with fonts + colors, what to blog about, and how to blog legally. Read Beginner’s Guide: Creating + Launching Your Own Website.