A question of money

Robert Gerrish Oh, no it’s happened again. I’ve just finished a conversation with yet another person who’s allowed money to wreak havoc.

Here’s the scenario: This soloist, who in the interest of client retention I shall refer to as ‘David’, runs a one-person creative business.

David is very good at his work and is acknowledged far and wide as someone with a unique talent.

This makes him feel good and most days he whistles a lot and smiles at strangers.

David is undoubtedly creatively fulfilled and loves just about everything to do with flying solo.

Sadly though, there’s one aspect of his work that regularly trips him up and messes with his head: pretty well anything to do with money.

David can’t bear talking about money. He hates being pushed to discount and he loathes having his invoices questioned. In particular, he detests what happened last week - a client took his work and refused to pay.

The thing is, all these yukky scenarios have a habit of reoccuring for David. Why is that? What’s going on? What should David do to reverse this pattern?

I have some views on this, but for once in my life I’m going to keep quiet.

Instead I’m throwing this open to the wisdom of the crowd. What advice do you have for David? What’s your top tip?

Share your thoughts below and I’ll compile the responses into a future, lengthier article.

Until next week.

Love your work,

Robert Gerrish is Flying Solo’s managing director and founder and works as a business coach, professional speaker, business commentator and consultant. He’s the co-author of Flying Solo – How to go it alone in business.

77 comments | Add your own 1 2 3 4 5 | Next» View all»

I hate to say it again and again - but David would probably relieve a lot of stress if he OUTSOURCED his management accountancy function to qualified personal, who dealt with the entire role of issuing and collection of invoices. The cost of this is probably not as high as you imagine. Here in Brisbane we have an organisation that does just that vxpartners - Outsourced Management Accounting Service Providers – I have no relationship with them – but you might like to look at what they offer – if you hate the numbers so much. They can probably work remotely. When it comes to what you charge – can you generate a fixed list of set prices? Difficult in the service/art field I know. Look around, do other larger organisations like yours offer fixed prices. Finally rather than offer a discount, state loud and proud you support a charity, your kids soccer team, community group etc and if they ask for a discount you can deflect it saying you are already supporting an organisation. B.T.W. support can come in all forms. I support several organisations with my most valuable asset – my time. Heather Smith from Brisbane
Quote in advance and take a (minimum 20%) deposit if a small business, formal purchase order if a big one AND what Heather said! Grant Hyman from Sydney | Read my articles
David needs to wear many hats as a soloist and whilst there are many unpleasant tasks in running a business, the collection of money and successful negotiation is an important quality in order to succeed in business for yourself. Having said that, David should apply the 80/20 rule and look to concentrate on clients he gets along with creatively and financially. Harry from Melbourne
bill the client the same day as they contract your services and have a line "payable within 7 days" or as we did.. softer option ..." my family and my bank manager would appreciate payment within 7 days" ( gets a smile AND payment )! peter hornhardt from melbourne
It's not negotiating the fee that is so much an issue as the failure of some companies to pay promptly. I know certain firms have a strategy of delaying payment, which is a disaster for soloists. It is the cycle of going from plenty to nothing that plays havoc with finances. Ultimately my superannuation suffers - as that is the bit that seems to get paid last on a month by month basis. So presenting some super strategies for solo businesses would be really good. Linda from Sydney
From what you're saying David needs to be upfront with the costs to clients. If he's busy enough and is confident that his charges give his clients value for money then there is no need to discount. If you're busy enough, who wants clients that demand discounts anyway? If they want a cheap job let them go and get a cheap job. If clients know your costs before they start, there's no room for asking for a discount.
When working out pricing, don't estimate the price down to the very last pencil - work out a rate that over the next year will give you the income/profit you want. Some jobs you will lose on, some jobs you will win on, but in the end you will come out about the same as if you laboured over every quote. The only thing is, you will have saved yourself hours of time spent quoting (which doesn't earn you any money).
When clients used to ask me for a discount I used to threaten them that if they asked again that my price would go up so they should accept my price quickly before it goes up because it is the cheapest it will ever be. This is a good way of saying no to the discount in a way that both people won't lose face but still come out smiling.
Anthony Dohrman from Gisborne, New Zealand

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