Becoming an Independent Contractor
Table of Contents
Why Businesses Need Them
In today's business world where competition is ever increasing, more and more companies depend on exploiting every niche within their particular markets to gain an advantage. Most of the time, these niches are specialized and require the skills of individuals with specific expertise in order to truly take advantage of the opportunities. There are many types of niches and areas of business where companies require specific knowledge from experienced individuals in order to properly function within that space. In leaner business environments, many companies lack the resources necessary to maintain permanent personnel to address these areas.
The specialized nature of certain niches makes it difficult for companies to recruit, train, and support the hiring of employees solely to work in those areas. Because of this scenario, independent contractors have become a popular alternative for companies that require very specific expertise.
Becoming an Independent Contractor
As this comprehensive information provided by the U.S. Small Business Association shows, there is no set list of skills or qualifications that are required for an individual to become an independent contractor. With that said, the key element to becoming a successful independent contractor is having developed a great deal of expertise in their area of specialty. Along the way to earning the experience that gives individuals the ability to act as an expert in their field, they invariably develop relationships and networks of peers and potential clients that can often lead to opportunities when starting out as an independent contractor.
One of the most important aspects of becoming an independent contractor is that the individual must have the desire and the ability to become independent from the security of a traditional career.
Many individuals would truly love to work for themselves and have a flexible schedule and work hours. The lure of this type of freedom is one of the main reasons individuals choose to pursue a career as an independent contractor. But this freedom comes at the cost of uncertainty. Unlike salaried positions, there are no guarantees of income for the independent contractor and this is the primary reason that most individuals hesitate to go it alone. Individuals who have managed their finances well in the past or that have manageable expenses in the present have a better opportunity of weathering the period of uncertainty from resigning their current position to generating income through their independent contractor business. The better established an individual is and the further along they are in their career, the easier the transition can be.
Maintaining Your Reputation Is Vital
The single most important thing to consider when starting out as an independent contractor is building a solid reputation of hard work and expertise. Despite the competitive nature of business, it is not uncommon for competing business individuals to share information regarding the quality of the contractors that they hire. Maintaining high standards can create high demand from different companies with similar needs.
Importance of NDAs
In many cases, it might be required for the independent contractor to sign a non-disclosure agreement prior to being contracted, but this can be a fairly standard practice that the contractor will come across frequently, especially if they work for several different companies at the same time. Non-disclosure agreements help companies ensure that their sensitive information does not get disclosed to their competitors.
Specialization Is the Key to Success
Becoming an independent contractor can be a rewarding and lucrative career path if the individual has the proper experience and connections. The longer or more impressive an individual's resume is and the more professional references they can list, the greater the chance of making a successful transition to working for themselves as an independent contractor. A good example is described by the following extract from the Project Management Institute which details the reasons why many professionals are becoming independent contractors.
The key for the individual is to make sure that they specialize in an area that has a reasonable amount of demand to it, and ensure that they truly are experts in that niche so their services will be valuable to a wide array of potential clients.