Monday, June 26, 2017

Year Two in Business

Yesterday was the second anniversary of leaving my salaried job and striking out on my own in business as a freelancer. That must mean it's time for a look at how things went this year!

Let's start with some stats.  This year, I have:

- Worked for 4 big clients - 3 universities and 1 state government agency. The balance of the work has been roughly 40% University A, 30% University B, 20% University C, and 10% state government. I think it's pretty conclusive that the tertiary education sector has emerged as my key niche market at this stage of the game.

- Had 9 weeks completely off - a week apiece in the July, September and Easter school holidays, 4 weeks over summer, a week of being bedridden with flu in August, and one week in early September when I had an unexpected mid-project lull and literally no work in. Taking the time from 23 December til 18 January off was FANTASTIC and I hope I can do it like that every year!

- Worked an average of 4 days a week in the 43 weeks I worked (this was unevenly deployed, with a few 10-day-no-break stretches and some weeks with only a couple of working days in them).

- Attended client sites for meetings an average of 1 day a week except in my Monster Quarter, where it was usually 2 days a week.

- Had a very uneven spread of work across the year, with Monster Quarter 2 (Sept-Dec) carrying 35% of the overall year's work while Quarter 3 (Jan-March) carried only 17% (this was largely due to the 4 week break and then slow start back to projects). Quarters 1 and 4 were similar to each other, carrying 25% and 23% respectively each.

- Made use of subcontract labour to deal with overflow work. Using subbies was a new experience, with a significant learning curve, for me, but as I progress in business, it's an absolutely necessary tool to have in your box for those pressured times.

- Out-earned the salary I was on in the fulltime job I left in June 2015 by 10% in gross terms, although in real terms, this isn't true as it doesn't include superannuation (I made a self-contribution of 9% of earnings this year, which left me basically level-pegging). Still, if I'd have stayed in that fulltime job, I would've worked 240 days in the year as opposed to the 172 I actually worked this year, so working 35% less days for the same money strikes me as a good outcome! This represents a growth of 27% on my earnings in 2015-16, and given that I set myself a goal of 5% growth, I think I can safely say I kicked that to the curb.

Overall it has been another good year in less quantifiable terms, although more challenging than Year One (and not just because of the increased workload). I have navigated some complex projects in ways that were ultimately satisfying but caused a few sleepless nights along the way. I am still a lot happier and more free doing this than I was on salary, but the rubber certainly hit the road a lot more firmly this year.

Looking back at this time last year, I note that my goals for year two in business were:

- Save 70% of the Japan holiday money: No, I did not quite do this. I saved enough for the airfares, travel insurance and most accommodation, but that is around 60% of the total cost. Still, I made good inroads!
- Increase earnings by 5%: Kicked it (see above).
- Take at least 8 weeks off, including 4 in the summer: Yes indeeeeed!

So, I'm going to just keep swimming in business in 2017-18. I'm not ruling out an eventual return to some kind of salaried work, but for now, this is what suits me and my family best. My goals for 2017-18 are:

1. Get within 10% of 2016-17 earnings: To be honest, I don't have or want to have a growth goal for earnings in the coming year. I earned plenty for our needs this year, and I think a lot of it was a bit flukey, frankly. I don't want to set myself up to be crushed when it turns out that I can't make more rain this time, in a slowing market for my kind of work. I am continuing with my biggest project through til November and have two more biggish ones coming online in July, but replicating this big year probably isn't fully achievable, especially given the time out I'll be taking in what is traditionally one of the hottest work zones of the year.

2. Take 10 weeks off: This financial year includes our long-anticipated trip to Japan in the first three weeks of April. It's my intention to take 4 weeks off altogether for that - a few days either side of the travel for prep / recovery. I'll also be taking a week each in the July and September school hols, and I really, really want to repeat the 4 weeks off over summer.

3. Try to expand my client base: Ideally I'd like to have 5-7 regular clients, rather than the 3 regular and 1 intermittent I have now. I think it would be a much more stable way to operate. So I'll be trying for that in 2017-18.

Onwards and upwards, then!

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