The 5 Biggest Mistakes Freelancers Make (and how to avoid them)
Whatever stage of business you're in, there's lots of learning that comes with the entrepreneurial journey - for better or for worse. After working side-by-side with entrepreneurs in my law firm and connecting with my community here at the Contracts Market, I realized how many of these lessons could have been avoided by better communication and having a thorough and well-drafted contract in place that addresses pain points in the client-provider relationship before they become major issues.
If you've run into client issues it's a great time to consider how you can amend your contract to avoid them in the future. If you've managed to avoid major client issues, it's a great time to learn from others mistakes. Whatever you group you fall into, these are the top five mistakes I see freelancers make in their contracts and how you can avoid them:
Mistake #1: Vagueness
I can’t stress enough the importance of being specific in your contract, especially when it comes to the description of your services. Ensure you lay out exactly what services you will be offering, the time frame, the number of check-ins or calls with the client and any other information you need the client to know. Be crystal clear on what is and what isn’t included in your fee and if you create a detailed proposal for the work, reference and attach it to your contract. Because the moment any part of your contract has a whiff of vagueness, the Scope Creep (you know the ones!) will sniff it out and use it to their advantage.
Another great way to ensure your contract is specific is to add an “Additional Services” Clause. This clause tells them what your hourly rate is for services that are not included as part of your services and can also act as a way to market other services you provide to literally the hottest lead you can have: a client who has already booked you and is happy with your work! Why not have your contract protect you and work hard for you in your business. In this case, I’m a big fan of multi-tasking!
Mistake #2: Communication Breakdown
In my experience, open and clear communication solves most problems. If your contract doesn’t explicitly state the boundaries around communication, the lines can become blurred and it may lead to avoidable misunderstandings or issues. Ensure you make it clear in the contract how you prefer to communicate (ie. Slack, Voxer, text or email) and when are acceptable times to communicate (ie. business hours only). You also need to make sure clients are aware of how long it may take you to reply and when you expect them to respond and provide feedback. It’s important to remember that you are not a firefighter and not everything is an emergency. Setting the boundaries and expectations right off the bat will help you manage your workflow and also confirms that your clients understand certain clauses in your contract.
Mistake #3 - Vague Timelines for Deliverables
Most freelancers include a timeline for the work they need to deliver and it’s important that this is realistic and doable. However there may be deadlines you set that aren’t just for you! If your workflow is dependent on your client giving you certain information, ensure that you are clear with what you need from the client and when you need it by. Make sure that if your client waits until the 23rd hour to get you what you need, you aren’t put in a majorly rushed situation where your work quality (and mental health) suffers because of it.
Mistake #4 - Not Charging Enough and Vague Payment Terms
This can be a tricky one. As entrepreneurs, we’re constantly battling imposter syndrome and others’ expectations about what we should be charging. In my experience, most freelancers undercharge or underestimate how long projects will take. When you’re starting out, I highly recommend tracking your time to see how long things actually take to complete- this is even more important if you’re charging an hourly rate. This isn’t really a legal trick, but something I learned while working in law firms where I had to track every 6 minutes of my time. While it’s a horrible way to work, when you’re just starting out, it’s a great way to figure out the minimum amount you need to charge for projects.
In your contracts, it’s important to make it crystal clear how and when you expect payment, what will happen if the client misses a payment milestone (ie. you will stop working until payment is received), any late fees you may charge for missed payments and what happens if the client cancels the contract early. I often recommend collecting a retainer or deposit before work even begins to protect yourself.
Mistake #5 - Copyright Confusion
Protecting your work is incredibly important to your business. It’s also likely really important to your client to know what they own and what they can or can’t do with the deliverables you provide to them. Unless you assign copyright in writing, it remains with you, even if your intention was to assign it. If as part of your services you are assigning copyright to your client so they have free reign to use your deliverables, it’s important to include a clause to this effect, and that copyright is assigned only upon full payment of your fee. If you’re providing a license to your clients to use deliverables, it’s important to clearly define how your client’s can use those deliverables and any restrictions. Upfront communication is key here to avoid confusion and disputes in the future.
Review your contract every few months to make sure it still reflects your business practices and is supporting your business! As you scale, grow and learn, you’ll inevitable find certain processes and practices that work and don’t work for you. Your contract is yours to tailor to ensure it’s supporting you and your business as it evolves.
Starting your own freelancer biz is one of the most exciting things you’ll ever do and the legal stuff can be intimidating. Having a great contract can help you avoid these mistakes, whether you’re just starting out or deep into entrepreneurship and you can feel confident knowing your legally protected so you can focus on what you do best: building and growing your business.
If you’re not sure if your current contract is protecting you like it should, check out my contract templates and bundles I’ve created with entrepreneurs like you in mind. Each contract is totally customizable and easy to implement in your business.