Self-employment is just that - working for oneself as a freelancer or even a business owner. As the nature of the workforce changes, permanent and full-time employment will no longer be the standard, and it will be necessary for future workers to adjust and adapt. It won’t be unusual for a worker to be hired by several different companies, work in a combination of jobs, or work on a number of assignments.
For tradespeople, individual contractors and those with a skill or set of skills to offer, self-employment will be a viable and possibly the only alternative to more traditional employment.
Some people chafe under the confines of working for somebody else. For those with a vision, a plan or something to offer, there are definite benefits to being your own boss. Even if students haven’t considered self-employment as a part of their work future, they should keep their minds open to the idea.
Satisfaction - - there is satisfaction in running your own agenda, setting targets, timelines and goals. There is definitely satisfaction in seeing a good plan come to fruition.
Flexibility - - freelancing or running your own business allows the flexibility of tailoring the hours to suit lifestyle and other commitments.
Freedom - - the freedoms are both large and small. The freedom to take risks, adjust goals, implement new ideas and even change course. There is the freedom from office politics and workplace rivalries, and, if working from home, freedom from the daily commute.
Earnings - - the rewards of hard work are reflected in earnings, and the self-employed can spend or direct their earnings as they please.
When considering self-employment, it’s wise to be aware of and fully prepared for the disadvantages.
Hours - - the working day is often long, leaving less time to spend with family and friends.
Finances - - the costs of self-employment are often hidden. Depending on the type of work, the costs can be high and the income erratic or unpredictable. Ensuring financial commitments are met sometimes means that things are tight.
A few financial considerations:
- Rent
- Internet/phone
- Insurance
- Equipment
- Suppliers
Benefits - - there are no leave entitlements or other employee benefits. All of this has to be budgeted for, as does tax and superannuation.
Pressure - - the pressure of making decisions that could mean success or failure can be a heavy burden to carry alone.
Preparing students for their work future means preparing them for the possible realities of self-employment. To be fully prepared for this, they need:
- The desire to take charge of the future
- The ability to take the steps to make things happen
- The hunger to learn from both successes and mistakes
- The willingness to take risks
There are no hard and fast rules about self-employment, but there are some factors that are good indicators of being ready to commit.
Support - - the support and belief of family and friends is invaluable. It is good to have somebody to bounce ideas off, help you focus and offer encouragement if self-doubt surfaces.
- Even without this support, self-belief and determination can still get you there
Experience - - is valuable, and will come with time.
- Think of ways to utilise experience from other areas of your life
- Take seminars or courses that will be valuable
Financial preparedness - - or at least be prepared to adjust iving standards and make compromises until the cash flow is steady.
- Have a firm financial plan and get proper financial advice
- Be prepared to use savings
Commitment - - it almost goes without saying that selfemployment requires commitment.
- Make sure you have the energy for the workload
- Don’t burnout! Create a schedule that also includes time to breathe.
It is easy to make the mistake of entering the world of self-employment or small business underfunded. Employers cover the costs of supplies and equipment, insurance, wages, benefits and even professional development. All of this needs to be budgeted for when you are self-employed, and that is on top of normal living costs! Depending on the type of work the initial start-up costs may be small, but work can be sporadic.
If a decent bank balance or financial assistance from the bank of mum and dad is not available, there are alternatives to help get started.
Bank finance
One of the most common ways to raise capital is through a bank loan or bank overdraft. Banks and financial service providers usually require a tangible asset that can be used as capital, so this is not always practical or even an option for young adults starting on their work journey!Venture capital
For anyone starting a business, venture capitalists will invest if they see the potential for growth. Traditionally, venture capitalists received equity in the business in exchange for funding, but these days they typically demand a mixture of equity and debt financing.Business partner
A business partner may be a silent partner, someone with similar interests, a friend or a colleague. If students are thinking of a start-up, selecting a business partner shouldn’t be taken lightly. Partners need to share common goals for the business, and each needs to be clear of their role. Even if partners are good friends, it is a good idea to draw up a contract that includes a buy-out agreement in case of a breakdown in the relationship.
Grants and assistance
Individual states and the Federal Government of Australia have grants and assistance available for start-up ventures and businesses on offer at any given time. Students should explore the opportunities by investigating online.Crowdfunding
Crowdfunding is a popular way of raising money for projects and ventures, by collecting small amounts from a large number of people. Crowdfunding also helps to raise interest and is an ideal way of promoting awareness of the venture. Most crowdfunding campaigns use a reward base model where investors are given some form of reward, such as the product itself. Crowdfunding websites include Indiegogo, Kickstarter and GoFundMe.The ‘Flow Hive’ was the sixth most successful crowdfunding campaign ever. With an original goal of $100 000, it raised 16 million dollars in just eight weeks.
There are no hard and fast rules about self-employment, but there are some factors that indicate whether or not students are ready to commit.
Self-employment, even working from home, should be run as a business. There are aspects of running all businesses that are essential to success, no matter the size - and especially without an elaborate office, showroom or staff.
Do what you enjoy
It is the effort that is put into something that brings the rewards, whether those rewards are personal satisfaction, financial gain or pure enjoyment. None of those things have to be mutually exclusive! If you don’t enjoy what you are doing, you might not put in the effort.Be serious about it
Self-belief is essential. Staying focused increases motivation and prevents distraction. Being serious about what you do will always command the respect that is deserved.Set goals and plan
Make planning a habit. Planning forces an analysis of goals and helps create the steps required to achieve them. Having a plan also helps to measure success and reassess the original vision.Budget
Manage the budget wisely so that expenses don’t exceed income. Make sure risks are well calculated and seek financial advice.Be professional at all times to build a positive image and gain the professional respect and confidence of clients
- Present well
- Speak well
- Know the business
- Answer queries promptly
- Honour promises
- Provide the very best service or product
Invest in self-education
- Attend seminars, workshops and training courses
- Master your subject and push yourself further
- Respond to change and new ways of thinking
- Surround yourself with intelligent like-minded people.
- Join business associations and network
Be organised and don’t be tripped up by the small things.
- Establish a routine for the working day
- Develop systems
- Create a to do list at the end of each day or week
- Work from a single calendar to complete work and keep appointments
- Follow up
Be a part of the community
Community support is invaluable. Get involved - it’s as effective as advertising!
- Volunteer with a local charity
- Offer your services or sponsorship at sporting and community events
- Join the local business or progress association
Keep the personal touch
Clients appreciate personalised attention, which is so often lacking in this high-tech world. The personal touch and good old fashioned service should guarantee repeat business and word-ofmouth referrals.
- Be accessible
- Answer the phone in person or have a brief friendly message
- Return calls as soon as possible
- Keep track of clients and remember their names
- Follow up and let clients know their custom is valued
Use technology
It doesn’t take a lot of money to shine. Utilise technology and the internet.
- Create a knock-out website
- Stay abreast of changes. Use social media
Have a unique selling point (a competitive advantage)
Find the unique, set apart selling point. Clearly define that selling point and gain the competitive edge. Is your selling point:
- A superior product or service?
- Flexible hours?
- Personal attention?
- Lower prices?
- Expertise?
- Attention to detail?
- A combination of these?
