5 Costly Mistakes To Avoid When Consulting

Take note: If you’re afraid to offer a contract, you shouldn’t be in business.

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BY Brenda Della Casa - 09 May 2017

PHOTO CREDIT: Getty Images

There are few things more exciting for a new business owner than signing that first client and having the chance to do what they love under the structure of their own business and brand, and in today's market, freelancing is big business. In fact, a 2016 study by Upwork showed that there are 55 million freelancers in the U.S. alone, making up 35 percent of the American workforce.

If you're thinking of joining the consulting club, let me be the first to congratulate you. You're in for one of the most exciting and rewarding experiences of your professional life, but only if you do the work to ensure that you protect yourself. Ignore this important step and you're setting yourself up for a lot of unnecessary stress and possible burnout.

Here are five clear ways to avoid some of the more common mistakes made by new consultants.

1. Mistake: Not setting the right tone

Because most freelancers are usually so excited to have their first one (or two) clients, they tend to fall into the common trap of doing a little extra (read: free) work here and there. They respond to messages and emails in real time and take calls when they really should have been scheduled. You think you're being generous and accommodating (and you are), but the client sees this as setting a tone for the rest of the contract. This tends to backfire as clients become accustomed to being able to reach you and have you respond in real time, all of the time. You begin to feel overwhelmed, and before you know it, both parties are frustrated, resentful and confusion ensues.

Protect yourself: Put your guidelines in writing -- and stick by them

Have a very clear discussion where you lay out your professional boundaries and ask your client to do the same. Come to an understanding about working hours, response time and agree on how you will schedule calls/Skype sessions, etc. Once you have come to an agreement, put it in writing and have both parties sign it. If you are having a working weekend or going on vacation, let them know as far ahead of time as possible. Ask them to do the same.

2. Mistake: Being afraid to put a contract in place

I recently asked 15 consultants if they offered their clients contracts and was surprised to find that only three had one in place. The most common reason for not offering up a formal agreement? Consultants were worried that doing so would cost them a client. The best way to move past this common concern is to understand that quality contracts are put into place to protect both parties by making responsibilities and timelines clear, securing payments and fees and putting a formal agreement in place if the relationship does not work out.

Protect yourself: Make it legal

Put simply, anyone who is unwilling to put their signature where their mouth is isn't someone you want to be in business with. For most professionals, a contract is a basic step in the process of doing good business. In fact, several business owners I spoke to claimed they would steer clear of anyone who didn't offer one fearing they were unprofessional or untrustworthy. Paying a few hundred dollars to have a lawyer take a look over your verbiage to ensure that you are fully protected is a worthwhile investment.

3. Mistake: Not holding clients accountable

Whether it is allowing clients to hand in deliverables late, jumping through hoops to complete tasks by unreasonable deadlines or working with an unpaid invoice, many freelancers help to create a culture of chaos by not drawing a line in the sand when clients behave badly.

Protect yourself: Create consequences

Though revisions and delays are inevitable on most projects, there needs to be a clear understanding as to who is doing what and when it is due. I personally like to use a task management system to manage to-do lists and follow-up with a weekly email outlining what is being worked at and what is outstanding.Also, it is important to remember that accountability goes beyond checking items off of a list. If a client schedules a call and goes MIA, doesn't pay an invoice on time or crosses a line, you need to have a system in place to deal with it. Charging the client for a percentage or the full amount of time you set aside for the call is not inappropriate and stopping all work until an invoice is paid is acceptable.Just be clear to have these guidelines laid out in the contract beforehand. Once they are in place, it is up to you to abide by them.

4. Mistake: Allowing them to treat you like their employee

One of the biggest struggles freelancers face is forgetting that they are in a professional partnership with their clients. You are doing work for them, not working for them. The distinction is an important one.

Protect yourself: Remember that boundaries are a good thing

As a consultant, you are not privy to the benefits of a full-time employee nor are you involved in the day-to-day running of the business. You have been contracted to do a specific job, because of your talent, not to get caught up in office politics or drama or to feel anxiety about the mood or shifting decisions of your client every day. Additionally, when on-site, you are not there to "jump in and be a team player" on tasks that are not outlined in your contract.

5. Mistake: Getting too friendly with clients

We all want to work in a friendly environment, but getting too familiar with a client will inevitably blur the line between the personal and professional relationship, which can make objective decision-making and clear communication difficult in the long-run.

Protect yourself: Keep a professional distance

No one is saying not to open up a little bit or that you need to turn down every cocktail invitation, but it is important to know what to share and when to leave. This is where that age-old advice still rings true: Do not open up about or do anything you'd be embarrassed to have in print. Simple.