10 Mistakes You Are Making with Gig Economy Jobs
Gig Economy Jobs
Gig economy jobs are just that, gigs. They are afforded by the connected world we live in today. In this year, I have added over ten gig economy jobs to my business. They have allowed me to decide which ones are suited for my personality. I did this because the last few years were working endless hours in a cubicle largely making zero difference murdered my sense of purpose and value. I made great money, but I impacted zero business process, vision, and more importantly, people. My minuscule efforts were largely uneventful, yet I still craved impact. In fact, my desire for change was so great that I left the safety net of a corporate job. I can tell you that many corporate employees feel the same way, but my experience and other circumstances left me soaring into the air without much of a safety net. Ending the debilitating cubicle death was the principal proponent of breaking the cycle and thus my journey into the gig economy job opportunities.
My gig economy job experience started with ride-sharing contracting jobs like Lyft and Uber. I later added Postmates, Door Dash, Instacart, Shipt, Upwork, SitterCity, Task Rabbit, Roadie, TryMyUI, and Validately. I’m sure by now you understand what gig economy means. If you don’t, it is the short-term or freelance contractor jobs afforded by the technology that we now embrace. In other words, mobile phones and fast Internet means the always on or connected continuously technology web we’ve woven. If you aren’t familiar with any of these freelance style contractor jobs, then you might be missing out on services available to you. Gig economy jobs are sometimes interchanged with share type services such as Airbnb, Vacation Rental by Owner, and Uber. They allowed anyone to take advantage of additional income by merely offering their best skills or real services like cars and homes. We either share a talent, a car, a house – but ultimately they are all short-term gigs. For some, they turn into a long-term one.
How to Find Gig Economy Jobs
You may have a full-time job and still want to add income and want to know the latest in gig-economy job offerings. I found many of them merely by reading social media posts of other gig economy contractors. If you think you need to perform more than one type of gig economy jobs, there is a service called Turn, who aggregates them by kind and helps find those specific to your skills and geographic location. It’s an excellent service because every gig will want all of your personal information and then complete a background check. When you attempt to acquire said gig economy jobs, it’s always the same steps: E-mail, proof of identification, and background check. I’ve noticed that only one company is providing the same background check to each company so it just makes sense for you to use one company that will quickly take care of application to all. They even let you look at your background information before applying. You can use Turn or apply separately to all. Using Google will work, but I think you should join one or two social media groups and watch the conversation or ask! In metro Atlanta, the gig economy jobs are pretty prolific.
Gig Economy Pay
Before you quit your job and get all excited about a new outlook for your career, you need to know that these jobs are hard. There is nothing easy about driving a car all day, delivering groceries as fast as possible, or trying to please someone who thinks you are lucky to get $10 for your time. For Feb-May 20, 2018, my gross income from all my gig economy jobs is $5600. My net income after vehicle and data related expenses is $3,600. I started my gig economy experiment on February 11th with Instacart and Lyft. Because I’ve driven so many miles and I pay for my health insurance ($436 per month) my tax burden is lower. According to my Lyft provided Quickbooks Self Employed, I owe a $35 quarterly tax by June 15th. Is $3600 enough to live on in three months? Please read about how customers short tips and how that impacts the bottom line.
Let’s compare me to one of my most idolized ride-sharing contractor Terry. He creates content (another gig economy job) on YouTube and helps other ride-sharing business owners make the best of their drive time. In Atlanta terms, he’s off the chain, and I love watching his videos because he tells it like it is without any extraneous matter (bs). He says it like it is, “The money is out there.” The money is out there because people are so eager to have services brought right to their front door and are no longer satisfied with actually having to go out and find something.
This brings us to the critical component – if the money is out there, you have to get it. Your customer service skills have to be on point, and you need to be able to quickly determine if a few minutes of customer cultivation will pay off or, conversely, if ignoring it means you’ll finish faster and get paid more. As an example: If I have ten items I need to buy for a customer and one is not on the shelf, do I (1) Ask the store to find it in the stock room or (2) Mark it as out of stock and keep moving? If I choose #1, it may add another 5-10 minutes to my total customer time, and that means it will take away from the next money making opportunity.
I hope you understand that tracking your efficiencies are integrally crucial to your new gig economy jobs and you don’t make these ten mistakes:
1. Settling for Circumstance
Just because you are used to Uber’s interface, and you think you will make more income with that service doesn’t mean you shouldn’t try Lyft! Be passionate about ride sharing, not the mechanism. Technology says you can drive for any service so follow the one that offers you a potential for additional income, bonuses for performance, and engages you as a driver! The same goes for grocery delivery, babysitting, dog walking, freelancing and any other gig economy job.
2. Absorbing Social Media Opinions
You should use social media groups to connect with other gig economy contractors and gain knowledge but know that it can tend to have a negative spin. This happens because social media allow us a quick, passionate, response to any less-than-average experience. In the Atlanta Metro area, the Uber and Lyft Drivers Unite Facebook page can be both insightful and downright snippy, so not only do you have to have thick skin but you’ve got to sift through to find the nuggets of wisdom. Don’t use these sites to see a lot of inspiration, drive towards success by keeping your energy positive and sifting through the negativity to find the treasure. That’s how I found Terry and others, their tips do provide an informative look into ride-sharing, but often you’ll see that those driven to share their knowledge often find other mechanisms like Youtube, a website, or their own Facebook page that you can follow.
Another great option is the Meetup site where the focus is on actual personal interaction instead of knee-jerk social commentary.
3. Sharing Income with Third Party Merchants
Don’t add layers of costs to your business model. If you are a ride-sharing business owner and you’ve opted to add premium costs for things like candy bars, breath mints, etc., you should know that those companies follow basic 3-tier merchant services and you aren’t making as much. If you want more income while ride-sharing the thing you can focus on the most is more customer service and fewer snacks. Yes, there will be one-offs, but if you focus on your mission of providing the very best ride-sharing experience possible then you won’t need a snack box in the car! Do you want to sell candy or snacks in the car? Buy the materials yourself and use it as a tax write-off. Don’t let other merchants get access to your customers!
Conversely, don’t use your contracting status in an attempt to take customers and turn them to another company or try to mimic the business. You’ll end up being reminded of the agreement you made when contracting. Got a great business idea? Be original!
4. Not Scheduling Work
If you don’t schedule your week with a specific focus on the jobs you plan on accomplishing and the income you plan to make; then you are in it for the experience. Schedule each week with your objectives in mind. Do you want to make $500 for the week? Then schedule yourself accordingly! Do you just like an active approach to grocery delivery? Schedule yourself with that in mind. Don’t like working weekends? Gig-economy jobs may not be for you. Schedule your mid-week day(s) off and create a habit. If you drive for Lyft, they make that super simple. Very often they will have a weekly guarantee if you drive a minimum amount of rides. It’s the best thing about Lyft because they encourage you towards a goal. Accept the challenge, create your schedule, and go after the guarantee! Lyft doesn’t promise those because they don’t think you’ll make the threshold, they are betting you will beat it (and their data shows it).
5. Lack of Vision
If you started in gig-economy hustle because you wanted to earn extra income, then that is your vision. The mission you take (path) will point you towards that vision. After a few months you may find that full-time interaction or adding other gig economy jobs may boost your earnings. Before you continue, you should draft up a vision statement for your business and everything, and I mean everything, drives toward that vision. Everything you do has to map back to the vision. As an example: do delivery services map back to the vision of, “Drive customer value and excellence in passenger delivery”? You’ll need a vision that encompasses everything do. This doesn’t take rocket science – print your vision out or write it on a piece of paper or card. Put it somewhere that you see it every workday.
6. Not Paying Quarterly Estimated Taxes
Hopefully, you are using some estimation system to help you understand the amount of taxes you need to pay on your gig-economy jobs income streams. If you drive for Lyft, you probably can acquire access to Quickbooks Self Employed (Intuit) for free, and it also tracks miles. Quickbooks can estimate your quarterly tax payment for you. Even if it’s less than a hundred per quarter, it makes more sense to pay now then be exposed to potential trouble next year. You may not have to pay the quarterly taxes because your income doesn’t exceed thresholds and Lyft has some general rules you should check out. Consider that you are healthy and working now, so pay the estimated tax to ensure no surprise bill end of the year. Quickbooks or some other estimating tool will take out what you classify as a business expense such as miles, car costs, health insurance, and other essentials. If you already have a semi-permanent job and Lyft or Uber side-gigs, then what your employer is taking out may be enough. Don’t put off tomorrow what you can do today!
7. Ignoring Customer Service
Most of the gig economy jobs you will find are focused on customer service. In many cases, it is the tips provided that mean the difference between less than minimum wage and the advertised payout some companies think you’ll make. Your top priority is ensuring that the customer receives the best possible service. Driving a ride-share, shopping and delivering groceries, installing a television mount or walking their dog, you are in the customer service industry, and your customers don’t owe you anything. Each person has a different way of providing the best customer service possible, but it comes down to one basic tenet: Listen. Some of these gig economy jobs can be extremely challenging, but if you listen to your customer, understand their challenges, and solve their problems, you will always be rewarded.
8. Not Paying Attention To Change
If you are in the grocery delivery business, know that it will change significantly as large grocers invest in food warehousing and technology. While the convenience is not something many customers will relinquish, it’s certainly going to be a massive exodus when Kroger or Walmart offer the same delivery, same products, and same guarantees to the tune of a 10-20% savings! So don’t get too comfortable shopping for groceries if you feel like it’s something you will be vested in. Keep tabs on how the gig economy is rapidly changing, how new companies are using technology to solve customer problems, and which companies are vested in the partnerships with contractors. Consistently negative press (like Uber) does affect your bottom line and the type of customer you want to serve: that is one who wants to invest their disposable income into companies they trust. Keep these things in mind as your contract for various companies.
9. Allowing Negative Customer Feedback to Impact Your Energy
While the 5 Stars is very important in any gig economy job don’t let the few odd customers who give you less than stellar feedback ruin your energy. If you are committed to ensuring customer satisfaction and the one or two odd customers decide to ding your rating, try to understand the why and then move on. You will never please 100% of the customers 100% of the time. It is inevitable to get a customer on a day when they are in awful moods, didn’t get 4 boxes of 4-count applesauce in the flavors they wanted on a Sunday night after nine o’clock or gave you 1-star rating because you refused to walk through the eight-inch grass to deliver their thirty-five dollar grocery sacks. Yes, those two examples are real ones. Focus on the great comments you get from customers who understand what hard work is and how difficult it is to work in these conditions for pay that doesn’t warrant those extra tasks (like walking through snake-infested tall grass).
In the ride-sharing world, drivers are dinged for talking too much or not talking enough, having different aromas in the car, not waiting long enough, or driving too slow/fast. It’s as if customers believe that a low rating will suddenly change the personality and vehicle of a person whose only goal was to generate additional income. While Uber and Lyft have general vehicle requirements that every driver must follow, there is a moment at which the driver slowly rolls to a stop for pickup, and the customer has made an instant judgment before ever getting into the car! Then for the next few or many minutes, it’s a matter of attempting to change that judgment.
Be yourself, be focused, make customer’s happy, and file the negativity away!
10. Not Tracking Every Penny (and where it comes from)
The other night one of the more positive facebook groups posted that they would have a question and answer session with a seasoned grocery delivery contractor. In fact, he had over 5000 deliveries completed. I’ve only completed around 270. In my data, I’ve shown that around 30% of customers don’t tip even after using premium services such as Instacart and Shipt. It boggles my mind every time I think about it. So, I thought this was the perfect opportunity to ask about tips from someone who had that many shops or deliveries under their belt. So I posed the question, “What is your overall tip percentage?”. His answer, “I don’t know. I guess about 75%.”
Guessing doesn’t leave any room for improvement and drives the perception of your customers that status quo is quite alright. Guessing also doesn’t come in very handy when the Internal Revenue Service wants to know what your cash tips for the year were. I wondered if his true tip percentage was more like 67%, and if it was would it make a difference in how he thought his customer service skills were? You, like me, should be able to definitively say, “My tip percentage overall is 67%, the average number of items I shop for is 16 (or $77), and for the customers that do, the average tip is 12% of the grocery bill.” If you can’t say that, then you have no basis for performance indicators as a business owner.
Bonus: Celebrate Your Accomplishments
Some gig-economy and ride-sharing companies go a long way celebrating small achievements like numbered milestones, but you can create your benchmarks up front and then celebrate as you achieve them. Those could be dollar thresholds like the first five hundred or one thousand dollar income, a tip percentage, and or a customer who mentions you by name in comments that are reported back to the company. Whether you will be using gig economy jobs as an extra source of income or finding it fulfilling enough for full time – you should always find ways to boost your work esteem by celebrating your successes and sometimes that is much harder when working as a sole proprietor.
“The money is out there!” Terry’s Tips — Now go get it!