Some have asked about how to go out on your own and start a company or client base. It’s a common enough question and I have enough basic knowledge to tackle it, so I am going to tackle it. As always, this is related mostly to stenography since that was what this blog was invented for.
First thing is first: Decide whether to incorporate. Incorporation, done right, can limit your legal and tax liability. It is not something you should unquestioningly do every time, but it is worth your consideration. For this, you need to look up the rules surrounding incorporation in your state. Note that in some circumstances you may also file to do business in a county under a name different than your own as a partnership or sole proprietorship. Those business structures will not provide the same legal liability as incorporation, but they are options for the aspiring entrepreneur. With regard to incorporation you should know that for the best advice tailored to you it is advisable to hire a lawyer, an accountant, or both. They can assist with many pitfalls, such as failing to comply with workers’ compensation requirements. If you are creating a business entity or wish to do business under your name with a different tax or social security number, consider applying for an EIN or TIN directly from the IRS.
Now that we’ve breezed over the mechanics, let’s talk a bit about next steps. The most important step for any business is its customers. Who are your customers? Who are you targeting? Who is going to pay you money? What are they going to pay you money for? It can be incredibly difficult to get the business off the ground. Cold calling is a possible strategy. I would say keep a brochure handy for potential clients who show an interest. Beyond cold calling, there are many ways you can get yourself business, such as applying to be on an insurer’s vendor list, getting a state court RFP, or getting on the city’s vendor list. In the end, getting a client is going to come down to your charisma and your ability to follow up. I once tried to pull together a client list, and even had attorneys that said they would utilize the company I created, but I failed to stay involved and keep communication open, and unsurprisingly, they never called when they needed depositions done. If you don’t have charisma, you need to have an ability to follow up. If people do not know you are open for business, they won’t come in. You need to put yourself on the market.
Now we get to the big bad wolf in the room. How do we decide what to charge? Generally court reporting is a service. We are taking down the proceedings verbatim and creating a transcript of the proceeding. Though colloquially we say the transcript is the product, realistically the service is the product, otherwise the transcript would be subject to sales tax. The page rate is nothing more than a way to measure the time you are working on the project. That’s why a lot of reporters charge more for dense testimony. To this end, there are a myriad of services that you provide. The following words might ring a bell: Printing, copying, mailing, originals, copies, exhibits. Running an office, even a small office, has a lot of work and expense involved. Even if the actual cost of printing a transcript is low, the cost in terms of time can be very high. Let’s get this into more concrete terms. You know, generally, what you can make from a job if you take that job from an agency.
Now realize that you are putting all of the work into getting the client and making the transcript. Take some time out to understand that a good chunk of money in the freelance reporting, for the agency, business comes not from the original, but from the sale and distribution of copies. In New York this is something rarely said out loud, but agencies are allowed to charge 2, 3, 4, 5 bucks a page per copy, as much or more than the original, and then pay the reporter 25 cents, and that’s exactly what a lot of them do. So you may get a lawyer that says, “Oh. My reporting service only costs $3.50 per page.” How much litigation does your firm do, counselor? How many lawsuits that get to depositions have more than two parties involved? Let’s be clear. It’s not worth working for somebody at $3.50 a page if you could work for an agency at $4.50 a page, but if you can work for somebody at $3.50, and get a copy at $3.50, that’s $7.00 per page compared to the $5.00 per page you might have made through an agency. That’s $200 more per every 100 pages for basically the same work. The beauty of the business model? It’s scalable. If you start getting a lot of business, you can simply scale up, give away most of the original to the reporters you hire, and take the bulk of the copy sale for your work in getting the job.
Know the market. Know what it’s paying. Know how people are keeping their companies solvent and thriving. Don’t be afraid to call up and ask a competitor their rates. In the end, the game is going to be won by the players that do everything in their power to maximize gain and minimize loss. My personal vote is always going to be for the working reporter, and every bit of this blog has been about helping the working reporter with information that’ll assist them in improving themselves or understanding the business. So do us all a favor: If you take these basic concepts and you create a successful business, do the right thing and take a little time out each year to train people on how they too can be successful. Put out tips and tricks. Spread ideas and information. We will all be better off for it.
3 thoughts on “For The Entrepreneur”