How To Escape The Single Client Trap As A Freelancer

How To Escape The Single Client Trap As A Freelancer

If you’ve read more than a couple articles about freelancing, you’ve probably heard that you should be careful about putting all your eggs in one basket by working for a single client on a long-term basis.

And yet a lot of freelancers (myself included) seem to fall into this trap at one point or another in their career. Why? And more importantly, what can we do about it?

In this article, I’ll explain why all-your-eggs-in-one-basket isn’t the main danger, exceptions to the rule, what you can do to avoid the single client trap, and how to get out if you’re already in that situation.

What is the single client trap?

The danger that I’m addressing in this article is the situation where 80% or more of your income comes from a single client for a period of months or years.

I’m specifically not talking about working on a single short-term project at a time instead of multiple projects in parallel. Depending on your preferences and the type of work you do, that can be a great style of arranging your project schedule, as long as you manage it right.

I personally tend to work on 2-3 projects at a time, usually structured in the form of one major project and a couple of minor projects or ongoing maintenance contracts.

The real danger isn’t in how many projects you’re juggling and how, but how many clients you’re juggling (or not).

So what’s dangerous about just working for a single client?

Freelancers tend to focus on the fact that having a single client puts all your eggs are in one basket, and if the client decides to go in another direction, all of your income could evaporate overnight.

By the way, in many ways this is similar to the situation you face as an employee. And for the same reason that I’m not comfortable having one manager be in control of my income, I’m not comfortable having one client be in control of it either.

Additionally, you have little leverage if a client is currently paying 100% of your bills. They know you’re dependent on them and are less likely to be accommodating as you set boundaries, raise your rates, or enact other policies. Not good.

But in addition to these risks, I think there is a bigger downside to having a single client for a long-term period:

It pollutes your mindset.

If you don’t use a muscle regularly, it will weaken and atrophy.

In the same way, if you don’t have to go out and win new business, if you can rest on your laurels a bit, you’ll start to lose that edge, that hunger.

Your business systems will get rusty, your pipeline will go cold, your lead sources will wane, and worst of all, you’ll start to forget what it’s like to find and close new clients.

One of the most important traits that successful freelancers share is a constant focus on growing and strengthening their business. Fostering this mindset is the #1 key to your long-term success when working for yourself.

The single client trap robs you of the opportunity to foster this mindset, which I think is actually the biggest risk of all.

As I’ll talk about below, you can easily survive losing 100% of your client revenue tomorrow if you’ve taken the right precautions.

But if you lose the mindset, you can’t survive as a freelancer, let alone thrive.

What if you’re already stuck in this trap?

Ok, so that’s all well and good if you’re not yet mired in the single client trap, but what if you are?

First, don’t be too hard on yourself for ending up somewhere not-ideal as a freelancer, we’ve all been there 🙂

I’m going to address the worst case scenario here. If you’re in a situation that’s better than this, then great! You can use these same principles to get out faster and with less risk.

Important: if you’re working more than 80 hours per week, or the client is toxic and treats you poorly, then you’re in an emergency situation and you need to get out immediately, by whatever means necessary. You’re burning through your health, mindset, relationships, all to serve clients who don’t appreciate you or pay you what you’re worth. There are better clients out there, I promise.

Ok, so that aside, let’s say that you’re working 40 – 60 hours per week, barely making enough, all for a single client. They’re not toxic, but they’re not very flexible either. Here’s what I would do:

1. Tighten your belt

Do anything you can to lower your personal expenses. Due to taxes and overhead, every dollar you can cut from your monthly budget is $1.50 to $2 that you don’t have to earn from freelance while you switch to better clients.

2. Carve out at least 1/2 day each week for other clients

Do whatever you can to rearrange your schedule, be more disciplined and productive with your time, and set boundaries so that you have at least a half day per week of time available for something other than this client. A full day is much better.

This is now time that’s available for you to work on small client projects. If you don’t have any of those yet, you can use the time to brush up on your skills if they’re really out of date, or do more in-depth business development activities.

3. Set aside 30 mins every day to look for new work

You need more options so that you have confidence and leverage, so start digging for work. This shouldn’t take very long, but consistency is key. You’ll need 15-30 mins per day to work on this, and it may take 6-8 weeks before you really start to see the effects begin to snowball. But there are clients out there looking to hire people like you. You just need to find them, then find the good ones, then find the great ones.

Look at freelance job sites, Craigslist, Twitter, LinkedIn, etc. Talk to recruiters, past clients, other freelancers, etc. Turn off your phone, email, notifications, etc. Then set a timer and just grind for 30 mins. Do it every day for a couple months.

This works. I built a six figure business just from responding to freelance job posts, consistently, every day. You can use my system at LetsMakeApps.io

Since your main client isn’t paying you that much, it shouldn’t be impossible to get much higher-margin short-term projects here and there, even if they’re not enough to live on. Over time (months, not years), you should be able to make roughly 50% as much with those projects as you do with your major client.

You may also find a client or two who could cover your entire budget without you working full-time. If you want to stop working with your main client at this point, go for it!

If you’d like to keep working with them AND work with the new clients, proceed to step 4:

4. Renegotiate

If you’ve gotten to this step, you’re probably working a LOT, but you’re also making more. You should be making your original income from the main client, which is enough to live on (hopefully even more now that you’ve cut your budget), plus another 50% or so from the short-term projects you’re cramming into your free day per week (plus some nights and weekends, most likely).

More importantly, you’ve also got a system running that’s bringing you leads. If you’re like every freelancer I’ve coached through this transition, you’ll be feeling a LOT more secure with all those leads coming in.

Now use that confidence to set the terms you want with this client. Raise your rates, work 1/4 of the time (or better yet, take that out of the equation), stop working on things you don’t enjoy etc.

Hint: this works a lot better if you frame it in ways that will be good for them.

Also, this shouldn’t be a bluff. It’s not common to get clients to suddenly agree to pay dramatically more, change the way your agreement is structured, etc. It’s not logical, but the client may decide to just find someone else.

So don’t be surprised if you can’t get what you want. Do not go down this road unless you’re really ready to walk away.

Are there exceptions?

So should you ever work for a single client long-term?

I actually think that it’s ok, as long as you have the following things in place:

1. You’re getting paid extra so you can build up some buffer

If you’re taking on this risk, you should be getting paid extra for it. I would want at least an extra 25-50% to consider taking this risk. You’ll have to gauge your own premium, depending on your appetite for risk.

If you work for a single client for two years, you need to have built up 3-6 months of expenses so you can weather an extended period of trying to ramp back up to getting work after you inevitably part ways.

This will also enable you to walk away from a toxic situation.

What you definitely don’t want to do is get into a situation where you’re getting basically just enough to live on from a single client. This is the worst case: you’re an employee but without the benefits, and you don’t have the margin in time or income to build up a buffer that will let you escape from this situation.

(Already there? I cover that in the next section.)

2. You stay below 80% of your time for that client

In any case, I want to keep some amount of margin of time available. If you’ve got a family and other commitments, you know how quickly 40-50 hours per week of work time go by. If you’re spending 100% of that time on a single client, you’ll have a very hard time breaking out of it without just quitting one day and losing 100% of your income.

I would handle this the same way that I do for short-term projects at my weekly rate: tell your clients that you prefer to work Mon-Thurs and keep Fridays open for other minor client projects.

3. You keep the focus on your output, not your input

Even if a client is “full-time” to start, that doesn’t mean they need to stay that way forever. However, if you kick off the contract by working on an hourly rate for 40 hours a week, then you’re basically stuck.

On the other hand, if you can start the contract by agreeing to deliver an output, then over time you can start to scale back on the time you put in by becoming more efficient, subcontracting out parts of it, automating parts of it, etc.

It’s dishonest to do this if you’ve sold the client your input (meaning your time), but if you’ve sold them your output (meaning the results you’ve delivering), then it’s perfectly fine for you to invest in your business to become more efficient at delivering that output.

For example, let’s say you’re a freelance writer and a client wants to hire you to manage their blog full-time. Instead of just telling them your rate and multiplying by 40 hours, instead try to understand what result they’re looking to get from that time. Maybe they really would be satisfied if you sold them an agreement to produce 5 high-quality blog posts per week instead of 40 hours per week. This is much better for you, because you can probably eventually get those done in half the time.

By the way, this is much better for your clients as well. They don’t really want to buy your time; they want to buy a business result. Just sell them that instead.

Considering taking on a single client right now?

By the way, if you’re not yet in this situation but you’re considering it because you’re feeling desperate, the number one piece of advice I have is to hustle for more client leads. Read on for more info.

Act from a position of strength

Ultimately, we find ourselves in the single client trap for the same reason that we endure a lot of other sub-optimal freelance situations: desperation.

The cure for desperation is to have a lot of options on the table.

If you’d like to get started with learning how to find and close great clients so you can choose just the best options for you, then download this free bonus pack, which includes:

  1. My guide to quickly filling up your pipeline in an emergency
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There’s no magic bullet. You still have to do the work, but I’ve used these tools and techniques to build my solo consultancy to a consistent $250k+ / year in net profit, and I know they’ll work for you too.

Download the free bonus pack right now, and don’t forget to let me know how it works for you!