Independence Day Part 2

Read how I turned into an Independent Contractor here (Part 1)

So I talked about how I turned into a freelancer. Now you have to know a couple of things if you’ve decided that you’re going to go that way.

Learn how to negotiate

When I first started, you may recall them trying to beat my ass down to $100/hour right?

I held pretty firm at $110/hour. This took a bit of sass because I was thinking to myself: “FB you fricking idiot, are you NUTS? It’s $100 an HOUR. That’s $44,000 that you’re turning down!!!! $44,000 in 11 weeks (2 months), I might add!!!

But I held on tight because I knew that the market was hot, they didn’t have anyone with my skillset available and they were NOT going to throw away a contract for a bit of haggling over $10/hour.

Also, I also made sure that when I was grilled by the client, I passed with flying colours (apparently), and made them WANT me, and AGREE that even though I was missing French as a ‘nice to have’, I was the person for the job because they were desperate and had been searching for someone for about 3 – 4 months now.

So once the client ‘agreed’ on the broker’s side to take me, it was just up to the broker to bite the bullet and take a lower margin on me with the hope of a possible extension until next year, etcetera, etcetera.

Even though I was shaking in my boots at my lack of solid negotiation skills (my second try at it, the first was to get my very first job offer from $50,000 bumped up to $65,000), I just had to hold firm, pull in some inner confidence and literally say NO to $44,000, just so I could make an extra $4400.


You also have to know when to back down because you’re trying to do business with the broker too. They also need to make a margin and make a living (but not a HUGE one I hope, then you’re just getting fleeced).

When you start at a rate like $150 for example, and the broker asks for a little ‘adjustment’ so they can make a margin, then give them $10 leeway. It’s more than enough money (remember, it’s $10/hour) to make it worth their while to take you on.

All they have to bloody do is invoice the client for large sums of cash . They don’t even CARE if you screw up at the client, because if you do, they’ll pull you and you’ll never get another job in that industry with them again.

The other thing too is that if YOU screw up at the client, it’s YOU (like I said). So you don’t want to screw up at a client because it’s your name. Your broker has nothing to do with you. All they do is find you contracts, take a margin and invoice the client, and pass the cash on to you. Easy peasy for them.

So keep that in mind when you’re negotiating – their value is just to find contracts for you and place you. And it’s a two-way street. You have to go down by $10, and they send you to the client and keep you in mind for the future as being a ‘good’ consultant at the client and a good one to make a decent margin off on.

No one wants a consultant you only make $5 an hour off on, that’s not really worth the effort to handle the situation. They usually take about $20 – $70 per hour per consultant, depending on how crappy the consultant’s negotiation skills were and/or if the consultant didn’t check to see what the health of the market was like. Some don’t even know it’s so hot, and they keep charging their same rate instead of raising it by $30.

Don’t let them take more than they should because you are the one in the end, who’s doing the work at the client and putting your name on the line.

After you decide to do it, and you know it’s all systems go, here’s a short checklist:

Decide how you want to run your business

I suggest Sole Proprietorship because it’s the easiest to do. I had to incorporate because clients were asking for it.
– Sole Proprietorship
– Partnership
– Corporation

How do you register?

How do you register a name?
How do you register a business number?
How do you register for taxes?
What are your obligations for record keeping for the government?

Read up on how to run your business

What are standard business practices?
What are the key terms you need to know? (Generally, the broker is very important, because they’re the go-between for you and the client. You talk to them, they talk to the client, and they manage it from their end, collecting the cash, etc. You just sit back and get paid, and they get a margin off your hours billed.

So for example if you bill $110 an hour, they charge the client $150 an hour, and make $30/hour off every hour you bill. It’s a pretty sweet deal for doing jack all, but I wouldn’t want to always be trying to find a contract, negotiating with clients, getting hassled, whatever.

The key for me was to use brokers when starting out because I need to establish myself with the brokers, and then from there, get into client sites where I can establish my name THERE, and manage to (if ever), have them ask for me by name, and directly hire me instead of going through a broker next time.

But in my kind of industry, in this city, a broker is the standard practice unfortunately.

Hit up your network

Ask around and let EVERYONE know that you’re going independent. It’s going to help to get the word out, and someone may have a lead.

Troll for jobs on the internet

Sometimes on job sites, they’ll list contract or temporary work in your area – hit up those listings and submit your resume.

Another way is just to submit your resume to those search engines for jobs. Sooner or later, a broker or client will stumble across your resume and contact you.

Get organized

Once you start working, get organized. You need a filing system, folders, and you need to be able to sort all your receipts, your registration information, invoices, whatever. Being organized is key.

Hope it helps!

About the Author

Just a girl trying to find a balance between being a Shopaholic and a Saver. I cleared $60,000 in 18 months earning $65,000 gross/year. Now I am self-employed, and you can read more about my story here, or visit my other blog: The Everyday Minimalist.