10 Ways to make more money as a contractor
Here are ten ways to increase your earnings and to turn your company into a cash-generating small business:-
1. Contact Clients directly. You will probably not get much more money from them than if you had gone through an agency, but it gives you the opportunity to do much more business with them in the future, which agency contracts usually preclude you from doing.
2. Become an independent consultant in an area of expertise that you have, e.g. in techniques or methods and up your daily rate to the £750 - £2,000 a day bracket.
3. Get permission from your client to be able to supply other contractors (or permies) on a commission basis.
4. Ask to be allowed to tender for any projects that are going out to tender, or even for ones that aren't. Have CVs on hand to be able to convince your client that you are serious.
5. If you have obtained good technical or business knowledge of a project, whilst you have been at the company, offer to support it on a consultancy basis after you have gone. Once you've done this a few times you've got a business.
6. If you have obtained good technical and business knowledge of a system or a part of it, and the system is dated and hanging together by strings, make an assessment of how much you think it would cost to re-write it in a more modern language and present the proposal. Find out from the users first what they perceive the problems with the current system to be, and work in a solution to their problems in your proposal.
7. If you have a skill in which your client wants to bring the permanent staff up to speed, offer to run training courses on it. You have a cost advantage here as courses on the subject matter are likely to cost your client anything from £10,000 to £30,000 for a course with 8-10 places. You also have the advantage that you will be able to mentor your client's employees after the course has ended.
8. Very often the users of a system, e.g. Sales have their own budgets, some of which they spend on new systems from the IT department. Offer to supply some services direct to them after you have departed the IT department. Most users are technophobes and only get a fraction out of their software systems and packages that they could do. They have a great need of someone to hold their hands - especially when dealing with their own IT department. You could do the business analysis for any future requirements before it is handed over to their IT department.
9. Offer to take over the running, on an outsourcing basis of the system, or area of the system, where you have expertise. If you can do this on a fixed price basis they may take this up.
10. If you have management or project management experience, ask your client if they would consider a management buy-out of the IT division of the company. Venture Capitalists like management buyouts the best as there is already an existing customer and an existing revenue stream. You would take on board your client's permanent staff. You would try and get the senior members of the IT staff on board as part of the buyout, but approach the management (the CEO or Finance Director rather than the IT Manager) first before getting the senior IT management involved. Make sure that you have done your sums properly and work out the savings and other benefits to your client.