Posts Tagged ‘freelancing’

I am going to continue today talking about my passive income project which I started talking about last week.

Once I had (provisionally) decided that entering the Buy to Let residential market was my best option for generating passive income, my next priority was to de-risk the project.

I Don’t Like Risk
For me, risk was a major consideration. Clearly I wanted a good return on my financial investment, but more of a consideration is that I did not want to harm my existing company in any way. This meant that I needed to know that I had sufficient money in the business to get everything set up and a tenant in place before cash ran out.

Or put it another way, I wanted to be able to de-couple the cash needed for the Buy To Let project from the day to day cash needed for my main business.

For this, I needed a good cash flow projection. So I hit the spreadsheets.

My Project Projection
I created a cash flow forecast for the next 12 months of my business. I was already tracking future cash flow of my business through an application called Float (which was linked to the FreeAgent online account system), but based on my principle of treble checking everything from different angles, I created a spreadsheet with my own analysis.

Outgoings came from the last 12 months from my companies P&L report (lifted directly from FreeAgent). I then averaged the expenses per month and then projected these forward for the next 12 months.

For income (main business), I put in my previously calculated day rate, and multiplied the rate by the number of workable days per month. For workable days, I worked out the number of week days per month, and then removed the bank holidays (there seemed to be lots in 2012), and my scheduled vacation days when I knew I would not be working. This then gave me really hard solid numbers for income and outgoings per month, and therefore a cash flow.

Next, I put in the taxes for the next 12 months. FreeAgent had done a lot of the hard maths for me in terms of VAT payable and Corporation tax over the next 12 months – so I put these into the spreadsheet. That meant I did not have to worry about paying taxes at any point – the money was already allocated. Another less thing to think about.

Finally, I put into the equation my current company bank balance and the money I would be investing in the business – and the result was – it worked. I could happily transfer a lot of the company cash into the Buy To Let property, and my company would stay afloat with a tidy cash balance left in the company account to tide me over any hiccups (sickness, loss of customers, etc). The numbers also tied up with the cash flow forecast that Float was projecting – as I say, nice to have the same answer from two different directions.

Want to Use My Spreadsheet?
If you would like to see/use this cash flow spreadsheet, you can download a version here. Note, that to keep my life simple, my calculations were all WITHOUT vat – i.e, as if I was not charging VAT on my invoices nor being charged VAT on my bills – as at the end of the day these generally sort themselves out. It also meant I did not have to project VAT payments.

Also, the numbers in the cash flow spreadsheet have been tweaked for public viewing – not really going to tell everybody how much I earn or amount of tax that I pay  ;-)

Over the next few weeks I am going to be talking about my Passive Income project.

As I have talked about many times in the past, I wanted a way of generating money for my company regardless of what I was doing – eating, sleeping, working – I wanted to generate more revenue and more profit.

The next few posts describe the reason for this decision, the when, the how and the results. I will include my spreadsheets, my maths and the outcome – warts and all.

It is worth noting that these entries were written between the Spring and Winter of 2012, and stacked up to be available once the project was completed and had settled down.

I hope they prove useful.

It started with a problem
At the start of 2012, my company closed its 2011 financial year end. Thanks to some hard work and a lot of luck, I found that my company was sitting on a fairly large chunk of money. After I had taken account of the money to be paid on the profits (Value Added Tax (VAT) payback to the government and corporation tax on the profits), my company had recorded its best year ever.

But this left me with a problem – what to do with the money. Yes, it’s a nice problem to have – but its still a problem.

As I type this, its April 2012. Inflation in the UK is sitting at around 3.8%, and the best bank account with interest is paying 3.45% (very long term, and locked away cash) – which means that each year that the cash is sitting in a bank account, the money is reducing in value by 0.35%. Or put it another way, for every £10,000 in the highest interest paying account available, it would actually reduce in value by £35 a year.

Ok, so maybe that’s not a lot, but a loss is a loss – there must be something better to be doing with the money rather than letting it rot in a bank account.

Plus, I really wanted to start generating money from passive income.

Ways of generating Passive Income I wanted to Avoid
There are many ways suggested on the web for generating passive income. They range from the boring and predictable (sell e-books, trade on e-bay) through to the more obscure (generate virtual currency like bitcoins, create server farms to enter competitions) and even to the more risky (investing in stocks, spread betting). None of these appealed to me – either they were too risky or too much hard work (I didn’t want to spend all my weekends wrapping items to be posted from e-bay sales).

I was also looking for a large return and minimum risk option (yeah, I know, the holy grail of investments). By minimum risks, I meant something that would still be worth the original investment should anything go wrong.

What I decided On – My Passive Income Plan
There were lots of options still on the table, including expanding my business, buying another business, investing in other companies (via angel investments) and a whole host more.  After listing all the options, weighing up the pros and cons, and looking at the risk verses reward – I decided that my company would invest in……. property.

Lots of companies have invested in property in the past – but on the whole this has been through investment in commercial property- buying offices or shops and then renting them out . But looking around the UK today, all I see are empty shops (or shops with £1 stores in them) or offices that are being given away for next to nothing. Invest in the difficult world of commercial property? No thank you.

But residential – that was the ticket for me. Residential properties have been dropping in purchase value over the last 5 or 6 years so at the moment is very cheap. And with the banking chaos, banks are not giving out mortgages so people are having to rent.

I checked with 5 estate agents in my home town, and indeed that was the case. People were desperate to sell their properties (so would provide a good bargain) and also in desperate need for rental property. The initial numbers looked good.

So that was my plan – I was going to buy 1 or 2 residential properties through my company (why I am doing it this way in later entries), and will rent them out.

Next, I will cover the maths of the project.

I was recently contacted by a reader of my blog who wanted to know my thoughts on the best way of asking for more money from a customer when you have under estimated the work on a freelance project.

Now first off, we have to assume that you have provided an estimate based on a project cost (rather than a day cost). If the customer is paying by the day, then you have to let them know when you think you are going to take more time than agreed or budgeted, so that a higher than expected invoice will not come as a surprise. But if you are using a cloud based project management system, this is an easy task and they will be alerted by the system automatically as tasks slip.

But project based under estimations are a different ball game altogether. When such a project takes longer than you estimated, you could end up making a loss on the project – or cutting corners which means the customer will end up unhappy and unwilling to pay the bill.

Keeping Track to spot problems
First of all, its critical to both you and the customer that you keep track of the project progress in terms of the work agreed, the work you have completed, and if the work is on track. Again, project management software will allow you to do this, so everybody knows what is going on all the time.

The important thing is to spot slippage or extra work as soon as possible. There may be elements that you thought the customer would supply but you are now being asked to deliver, or a misunderstanding of requirements, or a delay from unavailable resources (either on your side or on the customers side). But again, the important thing is, the moment you spot a problem; that is the time to take action.

I have seen too many projects where the project manager thought things could be made up towards the end of the project, either in cutting corners elsewhere or everybody ‘working harder’ to make up the lost time. Yes, this could work – but generally this is just making a situation worse or delaying the pain. Much better to start having a conversation and coming up with a solution sooner rather than later.

Control scope creep or customer based delays
One of the major problems with projects for paying customers is scope creep. This is where the scope of the project is agreed up front, work is started, and then the customer will want more than agreed. This can come about from comments such as ‘But I thought it would do this as well….’, or ‘When you said A, I thought you meant A, B, C and D’. Then there is the external customer influence factor, where your main contact will say things like ‘Just got word from Joe in Marketing, who insists it should do this….’.. Good project scope documents should have a good limitations clause to avoid such problems, but lets assume its too late for that now.

In this situation, it’s important to control the creep. Say “That’s a great idea, but why don’t we deliver what we agreed on, and then we can look at B, C and D after the initial delivery“. This is called change control – and the beauty of change control is that you can then create mini-sub-projects after the main delivery, all of which are chargeable (or at least have the changeability discussion after the customer has paid for the main part of the project).

Customer delays can also come about when they promised to deliver something (data, specifications, resources, hardware, whatever), and fail to do so – or at least, they deliver it late. Once again, having the customer based tasks on a cloud based project management system will stop this from happening. Their responsibilities are scheduled, they are informed of the upcoming requirements, and automatically nagged when it goes overdue.

When customers are late, you have every right to ask for more money if it means delays or additional work for you. I would phrase it along the lines of “The project agreement was that you would provide a widget by the start of November. Unfortunately, the failure to deliver has impacted the project delivery and has resulted in xx lost days which are outside of the original estimate. We are therefore in the unfortunate position of having to bill for these additional lost days at the end of the project”. Again, do this as soon as possible, as this will mean fewer delays in the future (they will not want to get caught out again).

They may of course object to the extra charges, but now you have turned the discussion into a haggle or negotiation.  You could of course be the good guy and agree that “Ok, we wont charge you THIS TIME, but will have to in the case of any more delays.”

How I would tell them about under estimation
So now we come down to the tricky business of what to do when you have agreed work and you find that your estimate is nowhere near the amount of work that will actually be required.

Of course, the first option is just to bite the bullet, accept you have made a mistake, learn from the mistake and continue with the project to completion. Deciding to take the hit will need to be based on how much money you will lose, and how much future work is likely from the customer. Generally speaking, I personally side on the rule of “bird in the hand is better than 2 in the bush” and never assume that the customer will provide future work (even if they promise it). If the lose is acceptable, then I will just stay quiet, but if it’s a major hit, then the difficult conversation has to be had.

I would recommend that the conversation never be held either by email or on the phone. When going cap in hand to the customer, a face to face meeting is really the only option that will work. If that is not possible, try to get a face conversation with Skype, otherwise a phone call. An email is going to be last route you should try.

The conversation with them needs to be honest, lay it on the line, and start a negotiation. Try and find an additional payment which works for both you and the customer. They will of course be deeply unhappy, and may force you to complete the project at the agreed price – in which case your only option would be to walk away and make a total loss (with the possibility of legal action against you, subject to whatever legal document you drew up prior to starting work).

I would always try to get a balanced agreement – you are in a bad situation, so your aim would actually be an ‘everybody looses’ balance (e.g., you pay me more, and I will throw in free training and support). The agreement will vary depending on your situation, your project, the customer and your own charisma. But, I would start the conversation with something like:

Here is the situation. I produced the estimate for delivery of the project based on my understanding of the requirement. I am sorry to say that as we worked on the project, my knowledge grew clearer and as a result, I have realised that I have underestimated the effort required to deliver this. We need to talk about reshaping the project, either by re-estimating the effort and cost required to deliver to the agreed scope, or by shrinking the scope of delivery to fit with the agreed budget.

Then, stop talking, and listen to what they have to say. Negotiate!

One thing I can guarantee is that yours will not be the first project that the customer will have ordered that will have gone over budget, and I can also guarantee, yours will not be the last.

In a previous post, I talked about how I occasionally like to mix up my freelance working practices by working as an IT contractor on a customer site. The reason for doing this (if you don’t want to read the original entry) is to keep up to date with what is happening in the real world in terms of customer expectations, technologies and environments.

Now whilst selling freelance and small business services means putting on a sales hat and talking benefits and features, landing a contract is all down to the interview.

Throughout my freelancing career, I have done four contracts, and attended around twenty two contract role interviews. In all of those interviews, there has only ever been one occurrence where I was not offered the role. In most cases, I have 3 or 4 offers on the table, and it comes down to selecting the role I prefer.

I believe the reason why I was offered so many roles comes down to one important interview tip:

Give a Killer Answer to the Trick Question
I am sure that the people who have hired me have other candidates with similar or better technical skills, similar or better experience, and similar office/interpersonal skills. If they are any thing like me when I am interviewing for candidates (which I am often asked to do when freelancing for companies) the stream of people I am interviewing soon becomes a blur.

So I make sure I stand out with my Killer Answer to their Trick Question.

All interviewers at some point will ask what they think is a trick question. It may be in the form of “Whats your biggest weakness” or “Whats the number one thing you would bring to this role” or even “Why should we give the contract to you?”. I have found generally, all interviews will consist of such a question in different forms.

And my killer answer to any such question is always “Oh, Its because I am lazy!!”.

Yep – I know. It sounds mad. Why would I say such a thing? Why would I say I am lazy?

Simple – its an answer they wont expect. It’s a surprise. It will shock them awake. They will take notice. I will be remembered.

But clearly, if that was my whole answer, then its unlikely I would land any contracts. So I continue after a brief pause to let the answer soak in and have an impact!

“Oh, its because I am lazy!!!!” Pause (count to three)….”Sorry – that’s not quite right. Lazy is the wrong word. What I mean is that I avoid doing more work than is required. If a task needs something put together, I will look at what I have done in the past, or what is already in place, to reuse it as much as possible, which of course will save time and effort and build on what already works. Yes, sorry, lazy is the wrong word. Efficient – that’s a better word.”

That is a great answer as it shocks them to take notice, gets them thinking, then reassures them that they are going to get the biggest bang for their buck by hiring you.

Again, I know it sounds mad, but I make a point of using this killer answer to their tricky questions, and only once has it ever let me down.

And I have been interviewing people myself for over 20 years – I know what interviewers are expecting and what they want to hear in an answer.

Give it a try yourself.

Now and again I like to talk about systems that work for me. I am not talking about Cloud or Computer based systems, but work productivity techniques which allow me to stay productive and on the ball.

A year ago, I talked about my Bath Time technique for getting ideas and inspiration. Today is another one of those ‘out there’ ideas – about a technique I use when I am just too busy.

Working on One Project or Task
For the vast majority of my time, I am working on one major task. For Business, it may be one major customer project, or at home, it may be one major home project like a home repair or maintenance project.

In these situations – it’s easy just to get your head down and get on with it. Just cut out the distractions, come up now and again for a break (air and tea), start in the morning, finish in the evening – get the job done. Easy stuff.

But, then there are times when I am forced to juggle more than one ball. Sometimes I will have multiple projects which I’m working on, with some sales thrown into the mix, responding to urgent mails, doing customer support. Very soon, I can have five or six task balls in the air.

In this situation, spending all your time on just the one task will work for that specific project, but everything else gets no attention, so problems start to stack up. Soon, panic can set in, or problems can occur as tasks fall off the radar.

If you spend all of your time just working on customer work, when the project is over, you may find your accounts have gotten into a mess or your lack of sales activity means you have no future work.

My System for Juggling too many tasks
So the moment I see I have too many projects on the go, I resort to my paper based system. It’s a system I have used for many many years.

I take a piece of A4 paper, and fold it in half, then half again (so it becomes an A6 size of paper, or the size of a filing card). Then I create a grid with a wide column on the left. In this wide column, I write all my ‘needs attention’ projects – all the things I need to be doing.

I am currently using this system at the moment – and the picture shows my time juggling paper as it stands today. Excuse the hand writing and the chewed corners

What we have running down the side are my juggled projects:

• DWH & Paxar – Two customer projects I am working on
• TSL Market – Time I need to allocate to my own company marketing
• ToDo – Time allocated to my never ending general task to do list
• Emails – Responding and keeping up to date with emails
• Money – Doing money management – both personal and business – cash flow, reducing expenses, and other frugal activities
• MP3s – Another customer project I am working on
• Blog – Time allocated to this blog (trying to get ahead of myself with future posts, ready for my next big holiday in a few weeks)

So what I do is this; I work through the list, doing either one major task per item (such as knocking an item off of my do list, or clearing one email from my inbox) or working 40 minutes on that project. For customer projects, I generally do the 40 minutes stretch of work, and set an alarm to tell me when 35 minutes are up. When the alarm goes off, I then have 5 minutes to wrap up what I am doing – and then it’s onto the next task down the list. When I get to the bottom, I go back to the top, and start from the beginning.

I put a cross to mark when I have gotten up to in my list – if you look carefully, you will see the next box to be crossed off (going down in rows, then across in columns) is for the blog, hence my typing this now. You will also notice that some of the boxes have a small hand written note in them – this was my ‘next action’ on these particular projects – when I get back to the task set, I know what I should be doing.

When the tasks completed are big, or I have worked 40 minutes on a customer project (and the alarm has gone off), I then force myself to take a break, get another cup of tea, and have 5 minutes away from a computer screen.

This system allows me to rotate my work, and make sure everything gets attention, nothing falls of the radar, and everything moves along. When the urgency of particular items falls away (such as all my urgent emails are answered or top priority ToDo items are done) I can cross off the entire project row and I can start to relax. Once the number of projects falls below a panic level, I then switch back to my concentrated project work (one project at a time).

Combining proven techniques
This system may not be for everybody. Some people will find the constant switching between work types a distraction, but for me, the switching actually means I have time to think about what I am doing, and come back to projects with a clearer mind.

After having used this system for a few years, I came across a system that other people use called the Pomodoro technique – which is very similar in terms of having a timer to chunk up the day and taking breaks in-between time slots – although I think my system came along first

However, I have to say that where possible – running multiple projects should be avoided. Other people have reported switching between tasks and projects like this can result in either a 40% reduction in productivity, or you going mad. I have to say, I somewhat agree with both suggestions – which is why I only use this system when I have too many projects to juggle and I only use if for a day or so to get me over the too much work craziness.

Once the calm has returned, I can then get back to my concentrated method of working.

If you find yourself drowning in different work, give this system a try and chunk up your day.  Let me know if it works out for you.

Today I did something I have not done for a long time – I said no to a prospect.

There I was; with an email landing in my inbox saying that they wanted me to provide services, there was the purchase order number, there was the day rate we had agreed, lets get cracking. And I said no.

I thought it was worth sharing this story – in case you ever find yourself in the same position.

The history with the prospect is not complex. They had found my company via a Google web search, I had gone and visited them, we had talked terms, agreed rates, and then the emailed order arrived.

Trouble with my Gut

Now, I could say there was something wrong with the prospect. I could say that they tried to beat my rate down or demand too much bang for their buck. But no. The problem was with me – or to be more specific, it was my gut.

The logic of wanting to earn money and have a new customer was telling me to take the work, but my gut said… something was not right.

I could not put my finger on it. I have never had the bad feeling twinges about a prospect that I was getting about this one. Not ever!

I discussed the situation with my wife and some business friends, and when they asked me why I didn’t want to work with the prospect, all I could say was that it didn’t feel right.

I even tweeted my worries:

Jaffa Brown ?@JaffaBrown
Today, i am having a hard time deciding whether to take on a prospect as a new client. Something seems wrong, & my gut says No, run away.

And got a great reply from one of my twitter friends:

@idea15webdesign The measure of your business’s quality isn’t the projects you take on, but the projects you turn away.

Confirming and attempted work around

So for the next day or two, I worked with the prospect to try and work out what was wrong. But as soon as I started to talk about working practices (rather than the work to be done or the day rate), it threw up even more concerns.

They started talking about being available for out of hours phone calls, free consultations, multiple levels of approval for work, and paying by the day with full record keeping. The worries started to crystallize. My gut feelings maybe were making me more weary than I should have been, or see problems which were not really there, but every moment the sense not to work with them grew.

In the end, I sent them a very polite email in reply to their order of work saying “Sorry to disappoint, but…..” with a few reasons why I could not work for them. At the end of the email, I said “For these reasons, I feel that it would not be prudent for us to form a working relationship at this time. However, if you are still looking for assistance, I would be happy to suggest some alternative freelancers who could assist you”.

Once I pressed send on the email, I honestly felt so much better.

The take away

Let me be straight; I may have got this very wrong. It may be that the prospect would have been a great customer, caused me no problems, would have paid their bills, and everything would have been great. But, my gut said something was wrong. Call it gut instinct, sixth sense, sub-conscious decision making or a guardian angel, but whatever it was, it was shouting to get out of there, and out of there I got.

As business owners, it is far too easy to say yes when trying to win new business or earn money, only to find that we have taken on the customer from hell which will cause us sleepiness nights, grief and lost money.

My advice for fellow freelancers, contractors and small business owners is: If in doubt, try and work the doubts out. But if at the end of the day, your gut or heart has concerns, just say no. Saying No is not just a decision which is exclusive to the customers, we freelancers have the right to say No as well if it’s the right decision.

Once an initial project has been completed for a customer, the project invoice raised and the hand over done, it does not necessarily mean that your relationship with a customer is over. In addition to staying in touch in the hope of future sales and new projects, one thing well worth considering is arranging a Support and Maintenance contract with the customer.

There is no right or wrong way of selling Support and Maintenance. Sometimes, I will mention it during the prospecting stage (“of course, once the project is over, happy to discuss the support of the system”) or sometimes I will mention it on project completion (“So, that’s all done. Now are you happy to support the system in the future, or will you need support going forward?”)

Charging Support and Maintenance can be the icing on the cake of a project. Once the project is complete, the customer pays you an annual support payment upfront, and in return, you agree to fix any problems that come, up, answer questions etc, without further charge for the year.

Think of support and maintenance (S&M) as an insurance policy taken out by your customer for the year ahead.

What to charge for Support

Within an IT industry (other industries will vary), the going rate of support charges can range from anything from 10% to 20% of the original delivery cost. Typically, 15% is viewed as ‘fair’ – so this is the amount I generally try to aim for – charging 15% of the original project development cost per year. Sometimes, it is easier to work out how much time I am likely to spend supporting a customer (based on the help needed during initial development and handover), add a ‘fudge’ factor for the unexpected and then multiply this up by my typical day rate to find the annual cost for a customer.

And don’t forget that support charges also need to go up in line with your annual price increases on the anniversary.

Some customers prefer a call off support arrangement, where they pre-book a number of days of support in advance and use (and pay for) them as required. This may seem like an attractive option for a support and maintenance agreement, but unless they are paying up front, all the advantage is with the customer. It is a much better option to organise a proper and full support agreement.

Be specific about support dates and times

In addition to the cost the customer will pay for support and maintenance, the other major factor which can influence the price will be the dates and times of support.

Will you provide support from Monday to Friday? What about weekends? And will support be from 9am to 5pm, 8am to 6pm or will you provide support 24 hours a day? Also bear in mind that if your customer is in a different time zone to you, their 5pm may be your 2am.

Whilst there are again no hard and fast rules for how support charges change for different days of the week or times of the day, my general rule of thumb is that any weekend day is TWICE the cost of a week day (so 7 day support is actually charged as 180% cost of a standard working 5 day support contract – ((2 days * 2) + 5 days)). Then, for the extended hours (beyond 9am to 5pm), I add 12.5% per hour (so 8am to 6pm adds 25% again).

Companies who demand 24hour support will be used to paying through the nose for this constant level of support. Again, in an IT industry, typically a 24hour 7 day support contract will cost between THREE and FOUR times the cost of a standard Monday to Friday 9am to 5pm support arrangement (although I do know some BIG IT companies who charge upto 20 times a standard support cost for 24-7 support – and their customers pay it!!!).

Bear in mind that for extended hours or 24 hour support, you need to work out how they will contact you. In needs to be using a method that will wake you (if you yourself are providing the support and they decide to call at 3am) and that you can respond to.

Finally, when working out the costs, factor in the response times. You need to provide details of a) How quickly you will email/call them back, b) provide a solution or at least a get-around and c) A full solution if it’s a major issue. These times will vary from project to project, and industry to industry. My starting position for support agreements is 1 hour for call back, 4 hours for a get around and 48 hours if it’s a major issue or requires a fix.

What to Include and Exclude

Which leads us onto the big issue of what is and is not included. This list should be stated up front, and be in all discussions, all emails and in the final support agreements – as it is pivotal. Once agreed, if you leave holes, it is possible the customer could use the support agreement for all new future work or you may end up supporting things you never initially supplied.

Again, this will will be vary from project to project, and industry to industry. However as a starting point, here is my standard inclusion and excluded list:

• Support is provided only in terms of the project (name the project)
• Support is provided only in terms of hardware and software provided for the project by your company (name your company)
• Support is provided only for errors or questions relating to the existing functionality of the project
• Support is provided for any questions or software errors within the project, including data generated or stored by the project
• Support is provided in scope of the current functionality of the project or additional functionality added to the project by (your company) on a paid for enhancement basis in the future
• Support is provided on all functionality explicit to the project, including GUI front end functionality, back end database, supplied interfaces and data held in the database
• Support is not provided for errors resulting from 3rd party software, 3rd party hardware, interfaces or data (including database software, operating systems and the like)
• Support is not provided for additional features, additional data to be held, new entry prompts, changes to interface definitions or data entry changes – these would be provided under a separate enhancement quotation
• Support is not provided for additional reports or enquiries, either from within the software, or using 3rd party tools – these would be provided under a separate enhancement quotation
• Support does not include any additional training of staff. This can be provided separately as an additional service
• We reserve the right to charge separately for corrections or time required resulting from your staff errors (such as invalid entries)
• Support if provided on the basis on standard working days, excluding bank holidays, Monday to Friday, from 9am to 5pm… (etc)

If you want to see what my standard support agreement looks like (the wording), I offer you a copy to download for free.

I have just decided to treat my wife to a quick weekend break in the spring of next year. I am taking her for a ‘city break’ to Venice, Italy. Its just a short stay – 4 days visiting this wonderful (I hope) floating city of canals, bridges and great Italian food.  The picture below is Venice from the air (I didn’t know its an island, did you?).

But, I am not here to gloat about going away next year.   No, if I am going to gloat about anything, it’s the cost of the trip. From England to Venice, 5 star hotel in the center of the city, flights and transfers is costing me just £22.

Ok – honesty time.  So it didn’t really cost me £22 – it actually cost me £590 – but… in terms of budgeting it only cost me £22, because I saved £570 though other savings.

I have talked before about cutting personal and business costs.  Well in October, I really pulled out all the stops.

For a lot of suppliers, I used the ‘I’m cancelling my account with you (now show me your best deal)’ trick with almost all my personal and business suppliers.

For instance, I struck a deal with Sky (my satellite TV provider) for a 50% discount for 12 months, which saves me £150 a year. And British Telecom (phone for home and business) gave me a 60% discount for 12 months – so that’s another £90. And so it goes on – totaling £570 of savings. Some were instant money back or savings, and some were discounts over time. So the savings were invested in a short break.

And the point is, anybody can do the same – all that is needed is advice about money.

I am not talking about specialist ‘Financial Adviser’ type of advice, its just a question of staying up to date with current advice, warnings of changes which may effect you (such as utility price rises), and taking advantage of the advice which is out there.

So if you are interested in saving/making money (both for yourself and your business), can I introduce to you, my definitive list of great money information (all the changes I made this month which saved me that money came from these sources).

There are a lot of resources out and I could list them all for you, but these are the cream of the crop:

Money Podcasts
BBC Money Box – For UK freelancers, this weekly show brings you all the latest personal finance news
BBC Money Box Live – Again for the UK, a weekly phone in show covering a different topic each week
Which Money Podcast – Another UK weekly podcast, with advice from the Which team
Radio 5 Wake up to money – Final UK podcast – a daily update on all things changing in personal and business money.
Planet Money – Three times a weekly, American based finance news
CNBC Fast Money – Daily updates on US Finance from the CNBC team

Money Blogs
MoneySavingExpert – For the UK, signing up to this weekly email feed is a must, with alerts on finance changes, utility rises, discounts and ways of saving money.  Sadly, there does not seem to be a US version of this site.
GetRichSlowly – A collection of articles about both reducing debt and growing wealth.
I will teach you to be rich – This site is run by Ramit Sethi.   It is less about saving money, and more about growing wealth.

Money Tweeters
@prairieecothrif -If you want to be inspired to live the life you have always wanted in a sustainable way, check out the connected blog.
@retirebyforty – He quit his corporate job! Now you can follow and see if he can stay out of the corporations for the next 40 years, whilst he shares money advice!
@TalkMoneyBlog – They talk about personal money issues and give free information, help and advice about the mortgage market, debt problems, credit cards and money saving tips.
@thisismoney – This is Money: news, conversation, top articles, tips, advice and opinion from the team at the UK’s best financial website.
@lovemoney_com – Lots of useful information to help you have a better relationship with your money.

If you have any other suggestions of blogs, podcasts or tweeters to follow, I would really love to hear about them.   Please, leave a comment below.

I am going to get straight to the point… when you are working on a customers site on a fixed term contract, who do you think is the most important person in the company?

Do you think it’s the end users of your service – the staff within the company who will use the products, services, management or consultation you are providing?

Do you think it is the top level boss of the company – the MD, FD or CEO?

Do you think its that person who insists you help them – the one who always goes whining to everybody when they are not happy?

Do you think it’s the person who pays the bills – the head of the finance department?

I am going to suggest the most important person is…. the person who originally agreed for you to start work on the contract. Simply because – it is they who will make the decision whether to keep you on when it comes to contract renewal time.

You may have done a lot of great work for the MD, helped out one thousand end users, and assisted all your new friends in the desks around you with their technical work, but if that person who employed you is not aware of all your activity, then your perceived value is greatly reduced, and this will impact you when they are weighing up whether to renew you or just let your existing contract end and let you leave.

So whatever you do, make sure that person who controls your contract is your VIP.

Give them a special “I always pick up for you” ring tone on your phone, make sure your client email system highlights all their emails, and make sure their work is always a high propriety in your do list (dropping other work when they give you a new action).

That is, assuming you want to be renewed in your contract.

Part of running a business is dealing with problems. Whether you run a small business, a start-up, you’re a freelancer or a contractor, things will not always go as smoothly as we would hope.

But when things go bad, how honest should you be with customers or financial backers?

Let me give you an example (from the real word)….

This last month was a rough one for us. We had a former disgruntled partner that was unhappy about where we were going with Trigger Happy. Taking matters into his own hands, this employee physically wounded other employees and threatened to sell out our intellectual property. It’s a sore subject for us, so we won’t elaborate, but this former partner left us in a disastrous mess. He obscured all our shipping records so we had to rebuild our shipping lists one customer at a time. As you can guess, we have been very preoccupied rebuilding our records. The effect has caused a delay in application development and product delivery. Luckily, the storm has calmed, and everybody at Trigger Happy is smiling again. We’re back on track. We are shocked and saddened for what has happened, but we are more motivated than ever!

The above update was a long overdue update from the founder of a recent Kickstarter company/project called Trigger Happy (a way of controlling DSLR cameras from mobile phones). I am one of the backers.

After a month of people screaming on the kick-starter forum asking why the project was so overdue (3 months and counting) and with the few items that were shipped not working, the above project update was posted by the project founder.

I have a couple of problems with the above update (which can be read in full here):

1. Its way too honest and gives too much information. Look, companies have problems, but no customer or backer wants to be told the details because….. they don’t care. What they care about is how it affects them. Where is the service they ordered, their product, the refund? Does the situation cause them any risk or pain?? If you are in a restaurant and you have been waiting an hour for your food to arrive, you don’t want to know there is a delay because water has flooded the kitchen or they have run out of chicken or the chief has sliced his or her finger off – they want to know if they should be leaving to get food elsewhere – i.e., just give me an ETA for my steak. In the above communication, I would have just said “We had technical issues with our customer database, but the issue is now resolved, and we apologise for the delay”.
2. In this situation, after around 100 or so complaint posts on the forum (“where is my TriggerHappy?”, “I want a refund!”, “Why are you not keeping us informed?”), it took a month to post the update. When there are problems, constant communication is a MUST. It only takes 5 minutes to send an update.

I have said it before, and I will say it again – communication is King!!!! You can never communicate too much – keep everybody informed and they wont start guessing what is (or is not) going on and imagining the worst.

But as I say, you can be too honest (as in this example). Yes, tell them there was a problem (and it has been resolved), but really, people don’t care about the details – they just care what the effect will be for them, and that everything is back on track.