A proposal for the freelancer community
14 comments
The typical way we handle this is to a) charge much, much more than a full-time employee does over a similar increment of time and b) when we want to take a vacation, we simply don't schedule engagements.
As a freelancer/consultant doing programming, your rate should be comfortably high enough that your cash flow situation is rock-solid without working on a week to week basis. (If you disagree that your cash-flow situation is rock solid, HN reader, you are not charging enough. Raise your rates. If your cash flow situation is rock solid raise your rates anyway, you're still undercharging.)
The typical target utilization rate for a consulting firm is 70~80% ish, which means you get 10+ weeks of vacation a year. My business is a little quirky, but I would probably get 30+ weeks. It flows naturally from charging appropriately and, critically, never, ever, ever depends on a client saying Yes to your vacation.
As a freelancer/consultant doing programming, your rate should be comfortably high enough that your cash flow situation is rock-solid without working on a week to week basis. (If you disagree that your cash-flow situation is rock solid, HN reader, you are not charging enough. Raise your rates. If your cash flow situation is rock solid raise your rates anyway, you're still undercharging.)
The typical target utilization rate for a consulting firm is 70~80% ish, which means you get 10+ weeks of vacation a year. My business is a little quirky, but I would probably get 30+ weeks. It flows naturally from charging appropriately and, critically, never, ever, ever depends on a client saying Yes to your vacation.
I have thought about this too living in Sweden where I as an employee had 25 days of vacation a year and how to bring that in to my freelancing.
As I see it; impossible. You can charge an extra in time or money to make up for it, but when you go on vacation as a freelancer you do not have anyone running the office.
As I see it; impossible. You can charge an extra in time or money to make up for it, but when you go on vacation as a freelancer you do not have anyone running the office.
You should definitely be pricing that into your rate already, IMO.
If you rate does not account for unpaid time you are charging too little. My rate supports my ability to take unpaid time as well as between contract time. It is a reality of freelancing and if the market demands freelancers then the market has to bare the rate of those non-productive hours if not freelancing ceases to be economically viable. Too many people that get into freelancing look at an hourly rate and compare that to the salaried rate they where making, they think oh wow that is more money, but they never factor in down-time. A few hard lessons later and they generally double their rate or leave freelancing all together.
I would feel comfortable in keeping something like this explicitly mentioned rather than charging more without any explanation.
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It's not your client's job to care about your vacation - it's yours. The reality of freelancing is that you are responsible for your vacation, taxes and healthcare. That's one of the reasons people hire you - They don't want to have to think about it! Raise your rates accordingly.
Also, don't be a 'freelancer.' A 'freelancer' is a mindless drone who is told to do something and does it. Be a consultant. A consultant is an expert who provides value to the business, either in terms of time / money saved, or increased revenue. How you market yourself is important.
Here's a gem from tptacek: http://news.ycombinator.com/item?id=4245960
Also, go to hnsearch.com and do a search for 'patio11'. Read everything he has written - it covers marketing yourself and charging appropriately. Do it now. That proposal you're working on can wait :)
Good luck, and welcome to the crew!
Edit: Freelancers vs Contractors vs Consultants: http://news.ycombinator.com/item?id=3420396
Also, don't be a 'freelancer.' A 'freelancer' is a mindless drone who is told to do something and does it. Be a consultant. A consultant is an expert who provides value to the business, either in terms of time / money saved, or increased revenue. How you market yourself is important.
Here's a gem from tptacek: http://news.ycombinator.com/item?id=4245960
Also, go to hnsearch.com and do a search for 'patio11'. Read everything he has written - it covers marketing yourself and charging appropriately. Do it now. That proposal you're working on can wait :)
Good luck, and welcome to the crew!
Edit: Freelancers vs Contractors vs Consultants: http://news.ycombinator.com/item?id=3420396
Comments like the ones you link to are the reason I blow so much time on HN.
I have read everything patio11 has written about consulting , twice. As I've said on HN before his writing has changed my life in a few dramatic and interesting ways. Specifically this guy: http://www.kalzumeus.com/2011/07/08/business-psychology/
I somehow missed that link you posted by tptacek but it truly is a gem. I'm at about stage 2 of that now and it's exactly what I needed to hear.
I have read everything patio11 has written about consulting , twice. As I've said on HN before his writing has changed my life in a few dramatic and interesting ways. Specifically this guy: http://www.kalzumeus.com/2011/07/08/business-psychology/
I somehow missed that link you posted by tptacek but it truly is a gem. I'm at about stage 2 of that now and it's exactly what I needed to hear.
I had somehow missed that post until now. Thank you so much Ali!
Don't I know it! I have them bookmarked :)
Yes that post is to the point, probably the best gem of it is this one people who can speak both tech and biz --- are exceptionally rare. This cannot be understated, to me this is the mark of a consultant. If you are not as comfortable in front of pure business personnel, as you are technical people you need to get comfortable in that environment. If you could not see yourself doing well as a technical sales engineer, then you need to work on your ability to pitch concepts. While many of us would never take the role of a sales engineer, you must know that you could do well at the job if you did pursue it. The reason being, as a consultant you are a sales engineer. The more reputable you become, the higher up the corporate ladder you sell at. Large firms don't sell to middle management, they call their friend on the board up and strike a deal with the board, they work out implementation details with middle management. Thriving in the non-technical environments is paramount to greater success. Which brings me to the last point, and that is network, good consultants have a network, you have to network and not just you local users groups, you need to network at small business events and other industry groups. If you are not great at getting up in front of people, tostmasters is a great place to network, a good deal of those attending tostmasters are doing so because they are moving up the ladder and have to become comfortable speaking to larger and larger groups, some may be future decision makers.
If I were to start asking for explicit time off, I would have to start explaining all the time off I take now without telling anyone.
The proposal that I want to make to the freelancer community is to include a percentage of the working hours as vacation days for every freelancing project. This might be chosen depending on your experience and the country that you belong to. For example, about 10 hours for every 160 hours of work sounds reasonable as vacation hours. This would make for about 16 working days in a year that we can take off for vacations.
What do you think about this? Does this sound reasonable or you would still prefer charging for what you work and then take unpaid vacations?