You and me, we are working the simplest business model there is. Let’s not complicate things more than necessary.
First, the tax people want to know how much money clients gave you, and how much you spent on business expenses. The easy way is to get those numbers from your 1099s and bank records.
That’s all I care to say about bookkeeping. (Except that it is the only English word with three double letters in a row.)
Otherwise, what numbers should we be watching?
As few as possible, I say. If we loved spreadsheets and stock tickers we would have chosen a more persnickety profession. For us, streamlined is easier. And it works better.
Things that need fixing
I heard this story ages ago. In a steel mill, the shift boss comes down from his office onto the shop floor. He goes to a foreman and asks “How many tons did your crew handle today?”
The foreman thinks back, counts on his fingers, “Twelve.”
So the shift boss takes out some chalk, goes to the wall and writes “12″ in numerals about two feet high. He goes back to his office. For the next three days he does the same thing. He asks the tonnage, chalks it on the wall. It is always 11 or 12.
The fourth day, the shift boss comes around again. This time, he sees that someone has already chalked a number on the wall, in numerals two feet high: ”14.”
And across the shop floor, on another wall, another crew had chalked “15.”
The idea is, whatever you start counting gets better. Whatever you start measuring, improves. You can count miles run, clams dug up, buttons sewn, inches of belly.
Once, when my client list became too stale and inbred, I started counting how many new people I contacted every day. (It wasn’t a quota, it wasn’t a goal. Those don’t work.) I simply put a hashmark on the calendar when I talked to someone new. Some days were blank. And it was glaringly obvious. After a while, the calendar was full of hashmarks. After a while there were some new clients, too.
You might count pages done, like Mark Twain did. Or how many bills you send out. The trick is to pick something small and simple that you can directly control. Just measure it, count it. It will get better.
Either that, or you’ll just quit measuring.
When money is coming
I flunked Calculus twice. But I do have a Rain Man-like ability to calculate that 45 days from February 26 is April 13. (Non leap year.)
That’s because I was cursed for years with corporate clients who paid in 45 days, take it or leave it. When I issued an invoice on November 3, I knew payment was due decades later on December 19th. (The only way to deal with such laggards is to charge the hell out of them, and try to replace them with other clients.)
My designer friend Kevin visualizes a huge, slow-moving ferris wheel, with money up there in the cars, slowly coming around to the bottom, where he can scoop it out.
Paint your own picture, or use a spreadsheet if you insist. But you should know when the money’s coming. Or at least when the money is due.[ At this point, after rereading this post, I am worried that I didn't include enough useful information here.
So I am inserting this:
You know how when you are working at your desk, or trying to watch a movie, and a fly keeps circling your head, driving you crazy?
Do this: Kill all the lights in the room, draw down the shades. Then go into the next room, or into the hall, and turn on every light there is. The fly, not knowing any better, will meander out the door toward the light. As soon as he leaves, shut the door behind him and go back to your movie. This also works with mosquitoes.]
How long did that job take?
No, I am not telling you to charge by the hour. The top-earning freelancers have all outgrown that hourly thing. Surgeons and film directors never charge by the hour, and they make more money than you do. But we can argue that another day.
Part of being a pro is knowing how long things take, or should take.
Is this a four-hour job, or nine-day job? You should know that in your bones — which only comes from actually timing a lot of assignments, for real, without fudging. You need to know this for scheduling and planning. And you need to know if you are futzing and fiddling more than necessary. (You should also know how your brain works, or doesn’t. That is part of being pro.)
And no, you are not doing this so you can charge by the hour. But we can argue that another day.
What you do all day
It is one thing to suspect that you fritter away too much time each day. But it is another thing to discover that over the last two days you spent merely 24 minutes and 11 seconds actually writing in Microsoft Word — and the rest of the time screwing around in one manner or another.
I was using a nifty free app for the Mac called Timing Lite. It could tell me in exquisite detail how much time I squandered, by diligently recording my moves on the computer. After a few days, I quit using it.
The common advice is, if you are a designer, you should be designing all day. Or making pottery, translating, illustrating, or writing all day.
But here in the real world, you should shoot for four, maybe five hours of pure work. That is, writing from scratch, designing from a blank page, translating raw text, building brand new code, illustrating out of thin air.
That’s all the human brain can muster. The holics who say they ‘work’ eighteen hours a day aren’t actually ‘working’ all that time. Most of that will be foof like paperwork, email, phone calls, tinkering, fiddling, meetings. Of the ‘real’ work, the devilishly painful work, four hours is all you can do.
Manage that and you can build a legacy.[ Another thing. If there's a fly buzzing around the kitchen when you're trying to cook, don't try swatting him. You will only break a lamp or dislocate a shoulder.
Instead, wait till he lands. Then, creep up on him, and sharply clap your hands together exactly six inches above where he's sitting.
The fly, not knowing any better, trying to evade you, will stupidly fly up directly between your colliding palms. Game over. You can win bar bets with this trick.
I worked for one whole summer in a horse barn, where I learned this and other things about flies.]