When our economy is doing well, jobs are easy to come by and freelance opportunities are boundless. Unfortunately, from the pandemic, to near-endless money printing, and war in Ukraine, our global economy has had a lot to contend with recently.
For the first time in over a decade, we’re seeing real signs of a global recession on the horizon, with slowing growth, hiring pauses, and staff cuts in major companies.
It begs the question, how can you as a freelancer prepare yourself for a coming recession, and potentially even prosper throughout?
How to Secure Your Freelance Business Against Recession
Be an Expert and Find Your Niche
There’s a reason behind the saying, “jack of all trades, master of none”. While it’s an advantage to have a little knowledge of several different skills, your clients are likely looking for a specialist on a given job.
To ensure you stand out from the crowd and are worth hiring no matter what, look to “niche down” in your given field. This could mean that instead of offering universal writing services, you could offer SEO copywriting skills. Or instead of being a general graphic designer, specialize in logo design or UX design. Simply, the fewer people that are offering the same skills as you, the less competition you’ll have, no matter the economic climate. We’ve written about using the concept of Ikigai to find a freelance niche – give it a try to see if you can find a fruitful niche!
It’s a process that will take time to get good at – and known for – but the end result is well worth it.
Raise Your Freelance Rates
Your chances of a client saying yes to a raise are much better pre-economic crisis than in the midst of one! This will allow you to save more in advance for a rainy day, giving you additional breathing room in case you lose clients or need more time to find new ones.
It also means that in the worst case, if your client talks about having to cut back on freelancers, you could offer to temporarily fall back to your previous rate. It’ll hurt, but not as much as if you didn’t get the raise!
Maintain Multiple Clients
If you only maintain 1 or 2 regular clients, you’ll be in a tough spot if even 1 of them drops you. Unfortunately, seeking out enough short-term gigs to keep you going can become a lot harder in the midst of an economic crisis.
Make an effort to do regular outreach to gain new clients and if possible, keep some longer-term clients for whom you perform regular work. Even in a good economic climate, having a couple of regular clients can be fantastic for a more regular income and added peace of mind.
Have a Reliable Client Acquisition Strategy
Following on from the previous point – you should have a system in place to reliably seek out and market yourself to new clients.
This could be in the form of email marketing, cold calling, paid ads, and many other outbound avenues. However, don’t ignore inbound marketing options such as content publishing (like blog posts or videos), social media marketing, or search engine optimization (SEO). Both inbound and outbound methods can have great results, but also quite different requirements in terms of your investment of time and money.
Regardless of which method you choose, ensure you have an up-to-date portfolio ready to show your potential clients. Once you’ve got their eyes looking your way, a good portfolio can make all the difference in convincing a potential client that you’re the right freelancer for the job.
Grow Your Network
Besides helping fight loneliness as a freelancer, building out your network of fellow freelancers can have amazing benefits for your business.
You can build up symbiotic relationships with freelancers in different fields (especially if they’re related). For instance, as an SEO specialist, I sometimes recommend a web developer I know to my clients – who in turn recommends me to their clients when possible! It’s essentially word-of-mouth, but clients are a lot likelier to listen to these recommendations when they come from fellow professionals in a related field.
Additionally, don’t count out past clients. Create an email list of a handful of clients that you’re on good terms with (and preferably enjoyed working with). When you know that you have a free window a few weeks in advance, fire off a quick email letting this group know you’ll be available for any work they may have. You’ll either have some extra work locked in in advance, or will at least be back on their radar the next time something comes up.
Work on Your Brand
When times are tough, your clients will be paying more attention to where they spend their money. To make sure you’re a top choice for future jobs, it’s important to keep your brand image on point.
A few things you can do include:
- Ensure your website and/or primary sales channel (Upwork, Fiverr etc.) has a good-looking logo and tailored copy.
- Flesh out your testimonials section by asking past or current clients to write a few words about their experience with you (they’ll likely also be happy to just sign off on a brief but honest text written by you).
- Update your portfolio to include all your latest projects.
Cut Your Costs
It seems obvious, but even small monthly costs can quickly add up – both work and non-work related. Some ways to cut down on your spending include:
- Create a budget. This can be super simple, but it will help you keep a better overview of your outgoings and whether they’re all necessary. I also recommend separate personal and business accounts – it makes it easier to maintain a clear overview. Here you’ll find out more about why having a separate business bank account is crucial for you as a freelancer.
- Subscriptions and recurring costs. I often let these run for months longer than I need them – look over everything and cut off anything you no longer really need. It’s also a good opportunity to look for free services that do the same thing!
- Claim on expenses. You won’t be able to cut out all business-related expenses, but there’s a good chance that you can claim a part of them back on your taxes.
- Buy second-hand. It can be tempting to order brand new, but in many cases, it’s not necessary. If you know where to look, office chairs, desks, laptops, great home office lighting and a lot more can be had for an affordable price, without sacrificing quality.
- Food. As a freelancer, I know the temptation of getting food delivered multiple times a week, but it quickly adds up. Meal prepping on a day of the week when you have time to spare is both a great way to save money and will add convenience to the rest of your week.
- Relocate. This isn’t a viable idea for all freelancers, but after the initial relocation costs, some of the best countries for freelancers can offer incredible benefits both in and out of a recession. These range from being overall cheaper to live in to offering more generous tax rates so more of your money stays in your pocket.
There are several more ways, but I’ve found the above to be the most useful for myself. If there’s any one thing I’d advise, it’s the budget – it will organically reveal plenty of places where you might be overspending.
Develop Additional Revenue Streams
One income stream is freelancing, multiple are security. Building out both active and “passive” income streams can be slow going at the beginning, but the added peace of mind they can offer you is invaluable.
Some ideas include:
- Bundle existing services with valuable upsells. Supplement your existing skills with another that closely relates – something that doesn’t cost you much extra time but is a no-brainer for your client to say yes to.
- Monetize your knowledge. Let’s say you’re fantastic at UX design or copywriting – why not teach others how to do the same? This could take the form of courses, eBooks, or even YouTube videos.
- Subcontracting. There are only so many hours in the day, why not outsource some work to trusted subcontractors and enjoy the margin? Just ensure your clients aren’t expressly against this and that you check that the finished work is up to your own standards. (Another reason why networking is so important!).
These ideas are all very general – depending on your specialization there’s a good chance you have some unique possibilities in front of you!
A recession is a tough time for anyone, but as a freelancer you have the unique opportunity to come out on top.
However, it’s also important to reframe your mindset.
For instance, even if you make 20% less for a few months due to a lack of work, take it as an opportunity to sharpen your skills, enhance your workflow, and develop your branding and client acquisition for the good years that are sure to roll around again sooner or later!