Constant, steady, occasional: Diversification and your bottom line

A freelance portfolio is like an investment portfolio: diversification is your best protection against financial disaster.

It stands to reason that a recession-proof business will have multiple clients. If you can offer multiple services or work in multiple sectors, even better. But a less obvious kind of diversification is the most important of all: diversification in project frequency.

If all your work comes in constantly from a few regular clients, the loss of one of those clients can spell disaster. If most of your work consists of projects that pop up episodically, it's like counting on Chicago's Clark Street bus to get you to an appointment on time. (Chicagoans groan: Ugh, the 22!) You wait 20 minutes for your bus, then three buses appear at the stop at the same time, all packed full. It's an uncomfortable ride.

So as you plan your diversification strategy, keep these three categories in mind: Constant, steady, occasional.

Constant clients

Even if you've been freelancing for a while, don't quit your day job. Or your part-time job. Or constant freelance gigs that provide a predictable source of income.

For a long time for me, that meant teaching online college classes for City Colleges of Chicago. Then I was editing, proofreading, and managing web content for a biweekly magazine. Later it was editing a bimonthly newsletter for one organization and keeping blog content flowing for a software company.

Retainer agreements of various sorts are the gold standard in the constant-client category. Some professionals, like web developers, convert one-time clients into constant clients by offering ongoing service packages after the initial project is completed.

The mix of constant clients may change over time as the clients' circumstances change. The key is to have one or more of them in your portfolio to provide predictability and to smooth out your month-to-month cash flow.

Steady clients

Next, seek clients who can send you a steady flow of work. Book authors are wonderful to work with directly, but they can only send you as many books as they can write. Publishers, on the other hand, can send multiple projects each year. Most of my indexing work comes from my publisher clients, so if I have space in my schedule for indexing, I can keep a steady flow of books coming in year-round.

Sometimes steady clients don't pay as well as occasional clients, and they won't smooth out your cash flow as well as constant clients, but they are an excellent insurance policy for your business. If a constant client experiences a corporate restructuring and drops out of your portfolio, or if you're still waiting on that 22 bus, your steady clients who know and value your skills will be glad to hear from you. If some of them supply relatively large projects, all the better; then you need to cobble together fewer projects to keep the ball rolling.

It's worth keeping some projects from steady clients in the mix even when you're busy so you can sustain these valuable long-term client relationships.

Occasional clients

The occasional client section of your portfolio contains one-time customers who need your help with specific, time-limited projects, as well as repeat clients who need your services every now and then.

This is the category where you can most safely test the waters with higher rates, where you can best cultivate new collegial relationships, and where you can build your portfolio with new skills and in new sectors in ways that can lead to more constant or steady work, ideally at better rates of pay.

If you have clients from each of these three categories in the mix, you'll never go hungry. Enjoy the feast!