Freelance Business: How and When to Pay Freelance SEO Writers You Outsource Work to When You Have No Money
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How to Freelance: An SEO Writing “Payroll” Question
Recently, I received the following question from Cold Calling Carol, the freelancer whose SEO writing business took of this past summer. She got so busy that she outsourced some of her article writing, and had run into the following snag. She wrote:
. . . I was wondering how do you go about paying your writers when a client doesn’t pay your invoice in time or at all? I am still waiting on another client to pay me so i can pay my writer.
This happened to me when I owned my editorial staffing agency in New York (1996-2004). Remember, Inkwell Editorial started out as just an editorial outsource agency. We took on all types of editing, proofreading, coding and word processing jobs from large companies like Pearson Publishing, as well as individuals, eg, screenwriters and web designers.
We (my sister and partner at the time) outsourced the work to a team of freelancers we had.
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Freelance Business: How I Got Into – and Out of – a Financial Pickle
When we started the staffing division of the company in 1997, we were sending temps on site and paid them every week. But, clients sometimes took 30, 60 and even 90 days to pay us. Talk about being in a financial pickle week in and week out!
Many times, we had to beg, borrow and grovel to make payroll. Just as an aside, this is one of the main reasons many small businesses fail – cash flow problems. While it’s great to have jobs flowing in, it doesn’t mean a hill of beans if can’t make your monthly financial obligations.
We finally got a factor, which solved our cash flow problems.
Following is how I took the lessons I learned from those days into my SEO / freelance writing business.
Freelance (SEO) Writing Business Question: How & When to Pay Writers You Outsource Work To
In the beginning of my SEO writing career when finances were limited, I told freelancers that I’d pay them when the client paid me. I let them know that this could be as much as 30 days, but that it would usually be less than that, as most of my clients paid within days.
As I have a history on the web and freelancers could see that I was legit, I never had a problem finding SEO writers who accepted this arrangement.
Usually I’d pay invoices as soon as I had enough money in my PayPal account – whether it came from ebook sales or projects from other clients, etc. Paying freelancers this way got to be a pain though because of the recordkeeping, eg, tracking who worked on which project when, and when that freelancer should be paid, etc.
So as soon as I was able to, I moved to a weekly payment system – one I still pretty much use – which is, I pay everybody on Fridays. In order to be able to do this though, you have to have a “Payroll Fund.”
How to Create a Payroll Fund to Pay Your SEO Writers on a Regular Basis – No Matter When Your Clients Pay
Go back through invoices over a defined period of time, eg, one quarter, 6 months, etc. Add up how much you’ve paid freelancers “in total.” Then, compute how much that works out to be on a weekly basis. Stick at least double that amount in a “Payroll Fund” (triple if you can).
This way, you’ll always be able to hire and pay your freelance writers – no matter when your clients pay you.
Now, something can always throw this out of whack, eg, you get a large job and have to hire twice as many writers as you usually do. But, this is why it’s important to get at least half of a project up front (in my opinion).
If you have a payroll fund, you can add this deposit to that and still usually be able to meet your weekly payout obligations to your freelancers.
On a personal note, I’m back home in the states. I love travelling with all of my heart and I’d been in Jamaica since June. It’s the longest I’ve ever been out of the states at one stretch. And boy, let me tell you, for all of the problems this country has – I love it to death.
It is so good to be back home. There truly is no place like it (wherever it is for you), right?
Hope you’re enjoying the holidays. Now mine officially begin. I tend to go all out with decorating. One of my sisters is like, “Please, no more Christmas stockings!” I buy a few every year and have probably going on 50 so far. Tonight I’m going to pick up a few more and decorate my fireplace mantle. The rest of the decorations will go up this weekend. Can’t wait!
P.S.: Learn more about how to work on your freelance business – instead of “in” it – in How to Build a Six-Figure Freelance Business by Outsourcing (The Freelance Writer’s Outsource Package). Paying freelancers / outsourcers is covered — and a host of other “how to freelance” business questions.
P.P.S.: Ditch Your Job and Start a Successful Career as an SEO Copywriter? Get SEO Copywriting Training Today. Discount offered until end of year (12/31/2011).
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