Have you ever considered contracting? The Accounting market is in fantastic form right now and there are ample opportunities to leverage lucrative contracts. However, contracting is by no means a walk in the park so find out everything you need to know in our latest blog below.
Contracting in Auckland’s and Wellington’s Accounting industry can be a highly lucrative venture but making that leap without first considering the risks can be a dangerous decision. Working as an Accounting contractor is significantly different from permanent employment and can be a difficult transition for even the most experienced professionals. Our guide is here to help you understand the benefits and drawbacks of contracting and show you how you can secure your first assignment. Read on to find out more.
What is a contractor?
An independent contractor is someone who operates their own business and works for several clients on a fixed-term basis throughout the year. These highly skilled professionals are usually engaged for a single project that required specific or hard-to-find skills. Contractors can work for several companies at once and charge by the hour for their services. The length of these contracts can vary from several weeks to 12 months.
One of the main differences between a contractor and an employee is that independent contractors are not entitled to employee benefits such as sick pay, holiday leave or employer KiwiSaver contributions. To compensate for the lack of these benefits, and because these professionals have specialist skills, contractors often charge a higher rate per hour than other employees.
What are the benefits of being a contractor?
When compared to permanent employment, contracting can often afford greater flexibility in how, when and where you choose to work. A permanent employee would usually need to save up and spend their holiday entitlement to take a long-leave of absence, but contractors can simply choose to not take on any more work. Many independent contractors also exploit the chance to work from their own homes.
As contractors have specialist and sometimes specific skills, they often have the opportunity to be part of interesting, challenging or innovative projects. This means that contractors are usually at the forefront of their market and some of the first people to learn of new technology or methods of working.
As they are not permanent employees, contractors often operate with less workplace bureaucracy or office politics. This can allow contractors to work at a much faster pace than standard employees which is critical due to the short-term nature of their assignments.
What are the cons of being a contractor?
If you are highly skilled in what you do, then being an independent contractor can be extremely lucrative, but it does not come without its fair set of challenges. The first is that setting up your own business is no walk in the park. You will need to consider your finances and whether you have enough capital to cover your start up costs and living expenses when in-between projects. You may also want to invest in a good invoicing billing system to keep on top of who has and hasn’t paid their bills.
You will also need to think about tax and insurance. As an independent contractor, you will need to sort out your own tax. As an Accounting specialist, you will likely be able to handle your tax obligations yourself at first but as your business grows, it may pay off to engage a third-party Accountant to take care of this for you. You should also have adequate business insurance that will cover your earnings and risks, should something go awry.
A huge part of running a business is marketing and developing your services. Marketing your services to potential clients will be key to securing contracts and keeping yourself busy. Whilst you will be able to secure some work from word-of-mouth to start with, you will eventually need to invest in a good external brand.
Working as a contractor can be emotionally and mentally challenging. Compared to permanent employment, contracting can be considerably less stable. If the market takes a downturn, you could find yourself having long gaps between contracts. We highly recommend you find a business mentor to provide you with crucial advice and someone to talk to when things get tough.
How can you secure your first contract?
Entering the contract market can be difficult but incredibly rewarding if you are a highly skilled professional. Here are several tips to help you secure your first contract assignment:
Although you may have significant experience in your sector, employers will often want to see up-to-date qualifications to prove this. Becoming a Chartered Accountant is a fantastic example because you must complete continuous training each year to remain chartered. That said, we also advise you periodically up-skill yourself through various educational courses to avoid your skills becoming outdated.
One of the best ways to secure work will be through your existing contacts and networks. Re-engage with long-lost colleagues, managers and industry contacts and start attending events and conferences to get your business cards out there. Take your networking online via LinkedIn and other platforms and start expanding your reputation and reach.
Build a reputation
Eventually, clients may start approaching you directly because you have a reputation of being a highly capable contractor with a specialist of skills. Remember, you are only as good as the contracts you complete so approach every assignment with the same degree of professionalism, energy and skill irrespective of its scope or difficulty.
Engage a recruitment partner
Agencies that specialise in contract recruitment are an excellent port-of-call for assignments. If you work exclusively with one recruitment partner, they will be your dedicated eyes and ears for work in your respective market. They can also help you stay up-to-date with the Accounting market and provide some valuable business and career advice.
If you’re looking for contracting opportunities within the Auckland or Wellington market, speak to one of our Consultants who are here to help you take control of your career.
To find out whether we have any contracts available for you, call us on 09 377 3727 for Auckland and 04 472 4380 for Wellington.