The Gig Economy can be very risky…if you are not prepared.
Gone is the relative safety of the stable corporate job.
Freedom, autonomy and potentially a much higher income may the lure of the Gig Economy. But obviously, there are the associated risks as well. How do you manage these risks?
Here are some risk management strategies:
Diversify Your Gigs
In her book, The Gig Economy, author Diane Mulcahy recommends having a portfolio of gigs or projects. In my case, I try to build a portfolio of customers for my workshops from different industries e.g. healthcare, education, law enforcement, military etc. This way, my income is less dependent on what happens in any one particular industry.
You can also diversify by offering a variety of products and services. I offer a variety of workshops, in my area of expertise.
In the online world, you can utilize different strategies, to sell different products, to different market segments. You can have more than one website selling different products and services to different customers. I subscribe to a service that allows me to host up to 50 websites for a minimal fee. Click here to sign up for a Free Starter Kit which allows you to host up to 2 websites and shows you how you can set up your website in 30 seconds.
In my case, I plan to create online versions of some of the face-to-face workshops I offer. The intention is to expand my reach. This may mean I have to acquire skill sets in creating and marketing those online courses.
I may also create and sell online video summaries of management bestsellers related to my area of expertise.
Keep Learning
The rate of change is accelerating and the shelf life of knowledge is shrinking. We have no other option except to continue learning and to adapt. You can do this during your downtime in-between gigs and client engagements.
As I mentioned above, I have to acquire new skills to deliver profitable products and services. Fortunately, there are many online courses that are easily accessible and affordable for this. You need to incorporate learning as part of work in the gig economy.
You can also experiment with gigs outside your usual work or comfort zone for the purpose of learning. This blog, for example, is a project I am doing for learning purposes. It is not directly related to my main work or source of income.
At the same time, this blog is an experiment to test possible business opportunities. Who knows what opportunities this might lead to in the future.
You also need to keep abreast of developments in your area of work. You can subscribe to Google Alerts for example. And scan the horizon for new opportunities or threats.
Minimize Your Costs
Two of the biggest costs for most businesses are rent and salaries. As a freelancer, I work from home. I do not have to pay office space rent.
And rather than having staff, I collaborate with other freelancers on projects where I need additional help. I use technology to reduce my reliance on staff.
I remember in the days before email and the mobile phone, where corporate trainers like myself had to hire secretaries to answer the phone or receive (paper) mail, while I was tied up in a workshop. Now the mobile phone and my website has removed this need.
If you really need an asset like an office space, office van or office equipment, consider renting/leasing vs outright purchasing. The former might be a better strategy in light of a fast-changing and unpredictable environment.
You will also need to consider costs that will arise due to unforeseen circumstances e.g. accidents, property damage and health issues. In the corporate world, employers normally provide insurance cover for you. As a freelancer, you have to take personal responsibility for this.
Connect And Collaborate
As a freelancer, you might be working pretty much on your own.
So you have to make a special effort to build your circle of contacts to connect and to collaborate with.
Some of these contacts may eventually be your clients. Some may recommend potential clients to you. Some can become your partners on gigs that you may not be able to handle on your own.
By connecting and collaborating, your domain of opportunities opens up. You have more options. Having more options is always a good way to minimize risk.