I’m going to be honest with all of you – I suck at writing business plans.
In fact, despite operating four separate companies over the past seven years, I’ve only ever written a true, formal business plan as part of a Home Ec project in high school.
It’s not that I don’t think writers need to have business plans. Quite the contrary! Although it’s unlikely that most freelance writers will ever need to seek out bank loans or other types of financing (typically the impetus behind crafting traditional business plans), we do still need the structure of a plan to ensure that we’re meeting goals and growing our businesses in a sustainable, financially-savvy way.
So that said, here’s my “short cut,” DIY method for coming up with a viable business plan that doesn’t waste time on cheesy mission statements or unnecessary financial projections:
Section #1 – What type of writing do I want to do?
The absolute first step to writing your freelance writer business plan is to determine what kind of writing you want to do.
In my case, the types of writing I choose to focus on include:
- Website blog posts
- Website copy
- Ghostwritten ebooks
- Business marketing materials
- Business whitepapers
Your list might look totally different. If you’re focusing exclusively on web clients, the first three options on this list might comprise your entire business plan. Or, if you want to see your name in print, prioritizing magazine and newspaper work might play a larger role in your guide.
Really, it’s best to start your business plan off by focusing on the type of work you actually want to do. That’ll make you much happier in the long run than investing effort into projects you don’t really enjoy.
Section #2 – How much money do I need to make?
As a freelancer, you simply can’t earn the same rates as you did as an employee – and you can’t bid for projects or go into contract negotiations without a clear idea of your business and personal overhead.
Super writer Tom Ewer of the Leaving Work Behind blog put together a killer post on setting your freelancing rates over on Lifehacker recently, and I highly recommend taking a look if you haven’t ever put much thought into your prices.
The general idea, though, is to account for business-specific expenses, personal expenses and estimated tax payments, as all of these items need to be taken into account when setting your rates.
To give you a feel for how this method will ensure your expenses are covered, consider the following estimated expenses you might have as a freelance writer, based on my own past experiences:
- $570/month – Health insurance
- $250/month – Retirement contributions
- $65/month – Dental insurance
- $60/month – Disability insurance
- $25/month – Life insurance
- $50/month – Coworking space membership
- $25/month – Freelance Writers Den membership
- $10/month – Web hosting
- $10/month – Email newsletter service
That’s a total of $1,065/month – without even touching your mortgage payment, grocery bills or sushi budget.
So now, let’s take this and assume that you want to earn a “normal” salary of $75,000/year (or, $6,250/month). Factoring in an estimated 15% in taxes, you’ll need to earn a total of around $8,415/month in order to meet your income requirements. Breaking that down over four 20-hour work weeks (remember, as a freelancer, not all of your time will be billable), your target rates need to be around $100/hour.
Will you always hit that number? Not necessarily. Some weeks, you’ll make more and some weeks you’ll make less. You may decide to take on projects for less if you think they’ll offer good exposure or the potential for repeat business; in other cases, you may snag a job that pays above your usual rates so that you’re able to work less.
However, by knowing what you need to make, you’re able to approach business decisions from a much more realistic standpoint – one that ensures you’ll never come up short at the end of the month because you weren’t charging enough for your work.
Section #3 – How will I find clients?
The final step in this simplified business planning process is to figure out how you’ll get these clients. There are hundreds of different ways to market your freelance writing business, but a few of my favorites include:
- Replying to job boards
- Networking on social media platforms
- Asking for referrals
- Querying specific businesses that meet my target criteria (typically, marketing agencies and mid-sized businesses)
Your preferred methods may vary. If you love cold calling, put that in your business plan and make it a priority throughout your day. There’s no right or wrong way to complete any of these sections – what’s most important is that you create a framework for yourself that’ll keep you on track when it comes to finding and retaining well-paying clients.
Truly, your business plan doesn’t need to include more than the kind of clients you want to take on, what you need them to pay you and how you’ll find them. You can make things more complicated if you really want to, but I think you’ll be far better off if you put that extra effort into actually putting your plan into action!
Once you’ve finished your plan, don’t just save it as a Word doc and never open it again. Come back to it at least once every few months to figure out if you’re on track or if your plan needs some revisions. Think of your DIY business plan as a living, breathing business guide and put it to work for you whenever you’re trying to figure out your next steps forward!
Do you have a business plan for your freelance writing career? If so, share your experiences with planning this crucial document in the comments section below!