So you’re a business owner and you’re trying to cut costs but aren’t sure exactly how you should do it. According to the United States Department of Labor, labor accounts for nearly 70% of total business costs, a startling fact but one that sheds new light on the costs of doing business.
In today’s digital society, everything is done virtually online. From banking and investing to business meetings and remote doctor’s appointments, we are slowly but surely moving toward a world where more and more people work remotely. There are benefits for both contractors and businesses alike in this arrangement.
Few new business owners fully understand exactly how much money goes toward taxes and benefit programs in the United States, but the numbers are surprising to many. The Boston Business Journal lays out the facts: the costs of taxes and benefits to businesses range between 1.25 to 1.4 times each hire’s base salary. This means that for a $50,000 a year salaried employee, business owners can expect to pay between $62,500 to $70,000.
Based on those example numbers, each employee costs between $10,000 and $20,000 on top of their base pay!
For businesses who need additional skills or resources, but where hiring full-time employees doesn’t make sense, there’s a solution—start outsourcing work. High-quality freelancers are ready and willing to work on any project you can come up with, and they come without the headache of having to worry about taxes or employee benefit programs.
Are You Ready to Start Outsourcing Work?
Before you get started outsourcing, it’s important to:
- understand exactly what you want from outsourcing
- what your budget is and the quality you can expect for your budget
- your options for starting to outsource work and the different types of freelancers you may encounter
- the pitfalls and mistakes to avoid when looking for dependable contractors
Learn more about the signs to look for to determine whether or not you’re ready.
Understand Exactly What You Want
When you start outsourcing work for your business, it’s important to understand exactly what you want and how much you’re willing to pay for it.
In today’s freelancer economy, it’s easy to get sidetracked and lose focus, which is why you can start your outsourcing research by making a list with two columns:
- the type of work you need to be done (like graphic design, website development, proofreading, copy editing, etc.)
- the range you are willing to pay for each of the listed tasks.
As a rule of thumb, depending on the quality of work you need, rate is one of the most important factors.
Freelancer rates, quality, and reliability vary greatly among the different freelance websites like FreeeUp, Fiverr, Upwork, Freelancer, and others. On FreeeUp, freelancers set their own rates, but there are freelancers with a wide variety of experience levels and rates. Here are the rate guidelines we use.
In general, when you start outsourcing work to US freelancers, you’ll want to start with a specific, definable project in mind. The more specific you can be when looking for a new freelancer, the more likely you are to find someone who meets your expectations for rate, skill and experience — and who you can work with for the long term so you don’t have to keep coming back to this step.
When you’re connected with a freelancer, ask for a portfolio of their previous work that’s similar to your project. Doing so will give you a good idea of the skill level of the freelancer you’re going to be working with and if they seem like a good fit.
Choosing a Freelancer Platform
There are several different places you can look for US-based freelancers when you’re ready to start outsourcing — FreeeUp, Upwork, Fiverr, and Freelancer are some of the most popular. Each platform has its own benefits and drawbacks and can provide your business with the expertise you need for just about any project you need to be completed.
1. FreeeUp: Pre-vetted Freelancers
Like most marketplaces, FreeeUp connects businesses with freelancers with a large variety of skillsets. Unlike most other freelance sites, however, FreeeUp has an extensive vetting process that ensures your business has the best talent possible.
To request a freelancer, you share an overview of your project, choose the option to hire US freelancers, and indicate your rate expectations. When you post a request, you get connected with one to three qualified freelancers to interview for yourself. The hiring process is fast and there’s no more need for you to wade through hundreds of resumes.
From transcription and translation experts to highly experienced telemarketing and conversion rate optimization freelancers, FreeeUp has US freelancers from $20 to $75 per hour for all your outsourcing needs. To get started with outsourcing through FreeeUp, create your free account.
Freelancer.com is another freelance site business owners can use to outsource their workload to US freelancers. The platform offers a number of highly skilled, independent freelancers specializing in various fields ranging from website development and UI/UX design to content writing and proofreading.
Regardless of the skill level you need, it’s always wise to reach out to potential freelancers first to request samples of their prior work.
Fiverr prides itself on offering freelance services for as low as five dollars. Whether you’re looking to outsource work to US freelancers skilled in graphic design, proofreading, copy editing, or marketing, Fiverr claims to have so-called “gigs” for it all.
Unlike FreeeUp and some other freelancer marketplaces, Fiverr is focused on definable fixed-priced projects with a limited scope. If you know exactly what you need done and what it will take, Fiverr is an affordable option. However, if you need someone to consult with you and build a strategy around the work, you’ll be hard-pressed to find that arrangement here.
While Fiverr can be seen as having the cheapest freelancers, the work you get may or may not be the quality you’re looking for — after all, you get what you pay for. Fiverr has a public ranking system, and generally, sellers with a higher ranking will not only tend to do a better job, but they are also likely to charge more for their services as the experience they bring and the clout they have afford them that option.
Upwork freelancers tend to cost more because like Freelancer, the platform charges a fee on top of the freelancers’ rates. You can choose between project-based or hourly prices, like on FreeeUp, and rates vary depending on the contractor’s skill level and the service provided. Upwork also has a US-only filter so you can post your project only to freelancers based in the US.
One of the biggest frustrations we hear about Upwork is that when you post a project, you may get hundreds of applications. Sure, it’s great to have choices, but you’re outsourcing work to save time, not to spend hours sorting through freelancer resumes.
Finding a Budget That Works
In general, the decision to start outsourcing work comes with several financial decisions to be made. As mentioned, you’re saving money compared to hiring full-time, salaried employees. Of course, it’s still important to determine your planned budget beforehand.
There are three main ways to look at budgets: hourly rate, project-based fee, or ongoing retainer.
Hourly rates are exactly what they sound like — you pay for every hour a freelancer works — and are great for when you’re starting to outsource work. A project-based fee makes the most sense when you know what you need and what you’re willing to pay for it as a whole (and what’s reasonable to pay a freelancer for the fixed scope). Ongoing retainers (for example, 10 hours per week) are most successful when the number of hours is consistent over time and once you have an established relationship with a freelancer.
The payment arrangement is usually a conversation of preferences between the you, the business, and the freelancer. It may feel weird to talk about money, but it’s unavoidable and you’ll get used to it the more you do it. You can prepare yourself by understanding industry standards for different geographic locations, experience levels, and types of work. Here’s a good guide on freelancer rates.
Work to Start Outsourcing
Normally, something specific will trigger your desire to start outsourcing work to US freelancers — your existing team is over capacity, you need work done and don’t have the skills, or you want to focus on working on your business instead of in your business.
When it’s a specific project that triggers the need to outsource, it’s easy to go find the freelancer(s) you need. Here are some of the most effective types of work to start outsourcing and get your feet wet:
1. Graphic Design
Even with tools like Canva, not everyone can be an effective graphic designer. Outsourcing your graphics work to a professional designer can give your brand a more professional visual presence.
Whether you need a new book cover or an entire visual brand strategy, you’ll likely want an exceptional graphic artist to make it happen. Freelance designers can provide portfolios of their past work so you can see their capabilities, and you can start with a small project if you want to make sure it’s a good fit. Finding a long-term designer that really understands your brand often adds more value than piecemealing projects to new freelancers each time.
2. Copyeditor / Proofreader
Copyediting can become expensive fast depending on the amount of work you need completed. But, on the other hand, how much does it cost your business to sound unintelligent or have typos? The type of project you have will determine the type of freelancer you want. If you just need a second set of eyes on a blog post, you can expect a lower rate than if, for example, you need your full-length book copy edited.
3. Software/App Developer
Everyone knows apps are pervasive for users and customers — games, banking, social networking, and so much more. If you want an app developed, you likely don’t have a development team on staff (or if you do, you may need more man / womanpower). So you can outsource initial development as well as enhancements and upgrades as they’re needed.
Mistakes and Pitfalls to Avoid
When starting to outsource work to US freelancers, it’s important to do your due diligence. Choose the right freelance marketplace, provide a clear overview of your project or needs, and have a realistic expectation of rates and your budget.
One common mistake most new to the industry make is not properly vetting freelancers before you decide to pay them. FreeeUp provides pre-vetted freelancers so you can start 10 steps ahead with confidence that they’re up to snuff. You can dive right into the interview and have a substantial conversation about your project. On other marketplaces, be sure to ask for a portfolio, research the freelancer elsewhere, and look for legitimate reviews and testimonials.
When you start outsourcing work, it can feel overwhelming and scary. But many business owners experienced in outsourcing will tell you, “It’s addicting.” Once you get a taste of outsourcing, there’s no turning back —ou’ll see the value it adds for your business and look for more and more to outsource as your business grows.