2015-05-19 00:00:00Starting a BusinessEnglishhttps://quickbooks.intuit.com/in/resources/in_qrc/uploads/2017/05/freelance.jpghttps://quickbooks.intuit.com/in/resources/starting-a-business/transitioning-your-freelanceconsultancy-into-a-smb/Transitioning Your Freelance/Consultancy into a SMB

Transitioning Your Freelance/Consultancy into a SMB

2 min read

As a freelancer, your career often takes a pause because there aren’t too many professional choices you have. You can improve quality of your work or pursue bigger clients – but you will always be termed a freelancer. Being a freelancer has its benefits, but it also has some very real disadvantages when compared to a Small Business. This is when transitioning from a freelancer or a consultancy into a SMB is important. So if you’re at that stage where you’re evaluating whether to turn your skills into a small or medium business, the following are a few reasons why you should consider seriously.

  • Unreliable workload for freelancers Being a freelancer often means that your cash flow and workload are unsteady and inconsistent. Banking on steady influx of work is often not possible, as you won’t be able to depend on a regular client, project or profit, whereas running your own business will give you a series of definite points which will allow you to properly allocate your resources and plan for future success.
  • Timely Payments As a freelancer, you often are the mercy of clients and it is up to them to determine when you get paid and often, if you do. Running a business you attain added protection against clients as there are more legal recourses you can take if they don’t pay up on time. You will also have the support of your chattered accountant or an in house accountant that will be able to give you an accurate picture of your accounts.
  • You can prioritise your time As a business owner, you can ensure that you have a steady flow of work. You can utilise advertising and marketing budgets at your disposal to garner new business for you. But as a freelancer, you often rely only on word of mouth and are the one doing all the groundwork in preparation for a new client. Forming a business gives you the opportunity to partner with other businesses as well as hire people who have the expertise that you lack.
  • Benefits as a Business Owner

As a Small Business owner, you often get access to business benefits and certain perks. A freelancer is often left to fend for themselves and have no perk, rewards or incentives to speak of. Advantages like health benefits, insurance cover, etc are more easily available to SMBs than freelancers.

  • You spread yourself too thin As a freelancer, you have to wear a lot more hats and devote your time to tasks that can easily be delegated to staff members if you’re running a business. As a SMB, you can allocate people or departments to handling administrative or accounting issues, while you can concentrate on the work at hand. This way you can concentrate on building a business and also the tasks that interest you.

If the reasons above are applicable to your business, then moving to a Small Business is a good choice. Taking the plunge from a freelancer to a small sized business is hard work. But with the right amount of planning, well thought out strategies in place, you will be able to overcome the initial teething problems any new business faces.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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