So you’ve made the leap from employment to being your own boss as a sole trader? Congratulations! Now comes the tricky part: securing those all important first clients.
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When it finally happens, you’ll find it hard to beat the euphoric feeling of securing your first client (except, perhaps, the feeling you get when the hard-earned money arrives in your bank account). It’s vindication of your decision to go out on your own, and more clients will surely follow.
To help you along the way, here are some top tips to winning your first clients as a sole trader.
Perfect your sales pitch
As a sole trader, you’re in complete control of your business. There are no shareholders or directors to seek approval from, so what you say goes. But while operating the sole trader structure makes you no less professional than competitors running a limited company, you may find larger companies are nervous about employing your services.
To put them at ease, spend time honing your sales pitch and anticipate questions they’re likely to ask. Explain the benefits of working with you as opposed to a larger company (single point of contact, no bureaucracy, etc.).
You’ll also likely find larger companies are more likely to want to see you’re properly insured as a sole trader, so make sure you have all your relevant business insurance sorted and be ready to provide details when required.
Spread the word
If you’ve done your research, you’ll already know demand for your services is out there. It’s just a case of getting people to notice you. Splashing out on TV and radio commercials is unlikely to be a realistic option; even modestly priced local media might be out of reach.
But don’t panic. There are plenty of free ways to attract business, with social media a prime candidate. If you don’t already have social media accounts for your business, get them sorted asap. Twitter and Facebook are the two favourites, but others such as LinkedIn, Instagram and Snapchat all have their selling points.
The key is to hunt down people talking about the services you provide and join in the conversation. Don’t be overly salesy, just start getting your name out there. Simply replying to a tweet with some free advice can work wonders.
Find the right social media mix and don't shout too loud
Create your corner of the web
Whatever industry you’re in, it pays to have your own website. Don’t worry if you’re not particularly technical, it’s now easier than ever to launch your business online. Getting a basic, but attractive website built using WordPress, for example, shouldn’t take more than a few hours.
Remember that your website is likely to be a prospective client’s first impression of your business. Avoid long, rambling text and stick to your main selling points. Above all, get it proof read by a friend.
Get out and about
Some love it, others aren’t so keen. Whatever your opinion of networking, it’s something almost all sole traders will need to do in one form or another. It’s a unique opportunity for you to not only hunt down new business, but also speak to others in the same industry.
Sure, you’ll likely bump into a few competitors, but these too can be a valuable source of insight. You’ll hear success stories as well as tales of woe to learn from - and each one is an opportunity for you to gain insight into your chosen industry.
You might be surprised to even pick up work from competitors overwhelmed with too much to do at one time, it does happen.
Show what you’re capable of
One of the biggest hurdles is responding to the dreaded “Could I see your portfolio?” from your first client. Make sure you’ve got this covered. Grab together some examples from your last full-time job. If you’ve nothing suitable, consider being perfectly open with the client.
If needed, offer a discount in return for them agreeing to participate in a case study once the work is complete. Getting a selection of success stories under your belt can prove invaluable when pitching for new work.
Up and at 'em is the best way to be
Don’t undersell yourself
It pays to nail down your minimum rates. Once you’ve got these sorted, keep them to yourself. Add on a suitable percentage and you’ll have room to negotiate if needed.
Calculating your day rate isn’t quite as easy as dividing your old, full-time salary by the number of working days in the year. Will you be working at full capacity during all these working days? Probably not. You’ll likely have to put aside a chunk of time to chase new work and perform admin duties.
It’s these unbillable periods that many sole traders forget to take into account. Grab a calculator and hammer out the actual number of billable days you anticipate working.
Next, figure out the other expenses of being a sole trader - tools of the trade, business insurance, travel costs, etc. Don’t be alarmed if your day rate is higher than expected. Your clients should be prepared to pay extra for the flexibility you’re providing.
Losing your first client
Winning your first few clients will be truly memorable, but you also need to be prepared for the flip side. Having a contract cancelled or getting negative feedback can knock you sideways, especially when it happens for the first time.
Pick yourself up, learn from your mistakes, and start pitching to new, more appreciative clients. It’s all part and parcel of being a sole trader.
Jason Kitcat is head of policy and public affairs at Crunch Accounting, as well as its micro-business ambassador.