Back when I was on staff, I remember my first intro to this new company. They did everything right – they blitzed the media, made personal contact, attended the conferences, spent money to build the brand, and secured some pretty impressive client business. A year later, they were sponsoring conferences and being quoted in various publications. Two years later, they closed up shop.
Wait – didn’t I say they did everything right? Let’s make that almost everything. There’s one mistake they made – one that turned out to be the deal breaker for the company’s bottom line. They place 80 percent of their business with one client. You guessed it – the client backed out, leaving them without a way to cover expenses, let alone salaries. The death was quick, but not painless.
Mind you, the big client went elsewhere not because the company was screwing up. It was a tough time in the insurance industry – post-9/11 there were a lot of companies cutting back. This company’s client decided to take the work in-house to save a few bucks.
So looking at your client base, are you able to safely say that this won’t happen to you? If your most lucrative client disappears today, how’s tomorrow looking for you? I ask because I myself have a pretty good connection with one client – amounting to about 40 percent of last year’s income. If this client disappeared, would I survive? Short answer – yes.
The reason – I’ve diversified. Last year was phenomenal, but I have conservative expectations this year. I don’t see that big client as a constant. I see it as a gift and as something that could go away just as quickly as it came. For that reason, I have a number of other regular work outlets that I call upon – frequently. And I’m always looking for more should any of those disappear. That’s because I have been in the position where I’ve had 4 regular clients and all but one goes away.
See, you can’t expect one client (or any client) to be your salvation. I’ve seen this happen way too often in freelancing – clients, for whatever reason, don’t stick around. It happens. A lot. Get yourself a stable of regulars – three minimum – and make sure you’re always looking over your shoulder. It’s not enough to work for today. You have to assume – no, expect – the bottom to drop out at any minute. It’s what’ll keep you hustling for more clients and more projects. And it may just save your business.
I don’t want to be tied to one particular client, for creative as much as financial reasons. The reasons I FREE LANCE is so that I don’t get into the same type of situation I’d get on staff. I’d rather do a wide variety of projects for a wide variety of clients than build the same box I never wanted in the first place.
You’d be surprised how many in our ranks who believe as you and I do end up making that very mistake. 🙂
I’m like you. I want to have diversity in what I do as well as for the safety of it.
Diversity. Good in all things. 🙂
Good reminder, Lori! I have several regulars but lately a larger portion of my income than I’d like comes from just one of them. Finishing my website updates and stepping up my marketing efforts are therefore on my list for February.
Lori, anyone who’s thinking of becoming a freelance writer should read this post. Seriously. Diversity is key. I am even working on some passive income streams to further diversify my income. Counting on one egg to get you through in these times is suicide.
Katharine and Kimberly – exactly the things I’m hoping folks will read this and try like hell to avoid. None of us can afford to put all our eggs in one basket. EVER. Even in the best of times, clients do change direction.