Limiting exposure to clients and meeting notes from 30th April 2025
Posted by Paul Silver
On the 30th April, 17 freelancers met in the Lord Nelson Inn, Brighton, to talk all things self employment and tech.
This is some of what was talked about:
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- Clients not testing when asked
- Typing your code
- Enjoying digging through an undocumented and messy codebase
- The best browsers for ad blocking
- A sudden outbreak of neuroscience
- Limiting exposure to clients who are not profitable
- Experiences after being on The Piano
- Playing Samba and other relaxing hobbies
- Job application tracking
- A bad work situation getting flipped around to good
- Spiegeltent not coming to Brighton this year
- Brighton hating cars but needing the commerce from drivers
- Factors that make World of Warcraft addictive
Limiting exposure to clients who are not profitable
Some clients are in the early days of their company or have less money than you’d like for a variety of reasons. It is not always obvious this is the case. For any UK Limited company, you can look up their accounts by searching for their Companies House listing on this government website, if they have been around long enough to file their accounts.
If a company doesn’t show a profit – numbers in brackets like (1,000) mean -1,000 so a loss – or if they don’t have much money, at least when they filed their accounts, you have reason to be wary of them. If you’re going to be charging them regularly, especially larger amounts, they need to have enough money in the bank to afford you. If a company has too little money, that’s the point where a freelancer often doesn’t get paid.
If a potential client comes to you and you look them up on Companies House and find out they don’t have much money, you have a few options:
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- Don’t work for them – too much risk
- Do work for them, but limit how much you will do a month (or other batch of work) before being paid
- Do work for them, but insist on money up front
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Now you might say “I couldn’t possibly ask for money up front, that’s so rude!” I point out that not getting paid and having to take someone to small claims court, or getting nothing from liquidators as their company went under before paying you, is a situation much more likely to cause offence – to you – than dealing with saying to them “Look, you seem very nice people and you’re doing interesting work, but the lack of funds showing in your Companies House filings makes me rather nervous. I’d be very interested in working for you, if you are willing to pay at the start of the month for work to be carried out during the month.”
I had a very long term client who started out paying me up front as they’d got into a disagreement with a freelancer who introduced me to them and I was very worried I wouldn’t get paid. After several months of them paying up front, we moved to me doing a small number of hours for them before billing, then gradually built up to half my month being working for them. Not all client relationships go this way, I’m just pointing out that sometimes the situation starts a bit weird but ends up working out very well.
Protecting yourself from a company going under is a completely normal part of business and sensible clients will recognise this if they have had cashflow or profitability problems in the recent past. You don’t need to be over generous with your time when it is normality to have a slightly different relationship with them if they have had trouble. If they won’t agree to a reasonable relationship, you walking away before the relationship begins is likely doing the right thing over the long term.
It is hassle finding new clients at the moment, but it’s more hassle working for someone you think is a good client, who turns out to be a bad payer after you’ve spent time completing work for them.