Information is the most powerful tool any businessperson — including the freelancer — has in her armory. Inadequate information can lead to poor decisions. Information makes smarter decision-making possible.
Businesses keep track of all kinds of information. For some businesses, tracking the political climate is important because they may see sales increases and decreases that depend on what is happening in the local city council or in another country’s energy market.
To be successful as a business, an editor needs to keep records of all kinds. To determine what our baseline price for our services should be, we must keep records that are sufficiently detailed that we can calculate our required effective hourly rate (rEHR). To determine if we are earning at least our rEHR, we need to keep careful records for each project and for all our projects in aggregate; that is, we need both a micro and a macro view.
The information we need is more than just our costs of doing business or of running our homes. We also need to be politically aware. For example, how would Donald Trump’s isolationist positions, should he be elected president, affect the business of editors who have clients outside the United States? If Trump were, for example, to anger China with his protectionist policies, what is the likelihood that China would retaliate in a way that could limit American editors’ work with Chinese authors?
That type of political information, although important, is difficult (if not impossible) both to obtain and to evaluate, but that doesn’t mean we shouldn’t try. As the election season proceeds, the gathering of such information might lead us to change our marketing strategy — for example, to do less targeting of foreign clients and more targeting of domestic clients.
The thoughtful gathering of information can be the difference between a struggling business and a successful business. I found it very worthwhile in my early years as a freelance editor to track the types of editing I was being hired to do (e.g., copyediting, developmental editing), the types of manuscript (e.g., book, journal, business document, white paper, thesis), the subject matter of the manuscript (e.g., fiction, nonfiction, medical, legal, thriller), the type of service I was providing (e.g., editing, proofreading, desktop publishing), and who was doing the hiring (e.g., large publisher, boutique publisher, author, agent). I also kept track of earnings for each.
As a result of the information I gathered, I discovered early in my career that I needed to focus on book-length nonfiction manuscripts from medium to large publishers. I also narrowed the subject-matter fields.
I reconstructed my business to appeal to the potential clients who fit the profile I had determined was best for my business. (A lot of factors went into the decision of what was to be my business profile, and many of those factors were personal to me. You should not view my business profile as being the one you should emulate; what you should do is recognize the need for extensive data gathering about yourself and your business so that you can determine the correct business profile for you.) I stopped taking on small projects; I stopped accepting developmental-editing work outside certain subject areas; I stopped accepting occasional work from local clients; I stopped accepting manuscripts directly from authors; and so on.
I also redesigned my marketing approach so that I focused on those potential clients who I thought could best use my services. I redesigned my business procedures so that I could efficiently handle large volumes of work. And I also established a network of other editors who were willing to subcontract with me but under set conditions.
The information I gathered about my business over the first few years of my freelancing also led me to establish certain business policies. These policies concerned such things as my editing day and week, which we have discussed before (see, e.g., The Business of Editing: The Standard Editing Workday & Workweek), payment terms, and even, back in the 1980s and early 1990s, before the switch to online editing by the vast majority of publishers, that I did online editing only — no hardcopy editing, which was still the primary method.
The information I gathered also let me evaluate whether I was earning enough money to consider remaining a freelance editor. It was from this information that I realized it was wrong to evaluate a client based on a single project, and I created my Rule of Three (see, e.g., The Business of Editing: The Rule of Three). I recognize that my Rule of Three is not readily usable when you do not have repeat clients, which is another reason why I changed my potential client focus. To reach the goals I had set for myself, I needed repeat clients, not one-time clients. With one-time clients, each project needs to stand on its own, which can be difficult. No matter how carefully we evaluate a manuscript before agreeing to edit it, we do not know its difficulty until we actually edit it. With repeat clients and limited subject areas, the risk of financial loss on a client (not a particular project) is greatly reduced, so much so that I have rarely had to “fire” a client for lack of profitability during my 32 years of editing.
It is clear that we need information to guide us. The ultimate question comes down to how much detail do we need to track and keep. The answer is that the more detailed the information, the more useful the information. Consider this: When a client approaches you to undertake a project, do you track the time you spend evaluating whether to take on the project? Very few editors track that time; most begin tracking time from the moment they begin editing. Yet the amount of time spent evaluating a project and negotiating on it affects your editing day and week and your profitability. Even if you reject the project, the time spent coming to that conclusion is time you spent and cannot recover.
We tend to think of ourselves as editors first and businesspeople second. That is the opposite of how we should think about what we do. You can be the greatest editor in the world and still starve, be homeless, have no health insurance because you avoid the business aspects. Conversely, you can be one of the worst editors but still eat well, own a home, have health insurance because you paid attention to business.
The key is to balance the requirements of business and editing so that you are both the best businessperson and the best editor you can be. To meet this balance, you need to view yourself as a businessperson first and editor second. Doing so will force you to pay attention to the nitty-gritty details without which you won’t attain the financial success necessary if you want to devote yourself to perfecting your editing, which is what drives us as editors. With business as the first focus, the need for data becomes clear. The next natural steps are to gather the data, interpret the data, and apply the data to your circumstances, but to do so honestly and objectively.
Richard Adin, An American Editor