Tips for the startup: Outsourcing to freelancers

Being a startup, one has to face many challenges in the initial period. Normally, startups face common concerns like lack of finance, inadequate resources, high employee turnover, inefficient time management, and lesser projects in hand. However, the journey from a startup to an established brand isn’t much hard-hitting or unattainable, but it needs a good amount of patience, analytical skills, and timely execution of planning.

The biggest challenge for any startup is to strike a balance between providing value and utilizing limited resources in an effective manner.

Startups aim to provide value in terms of innovation, quality, and convenience, albeit having limited resources and may be facing intense competition to be a pioneer in the market. In the initial period, startups can’t afford to recruit a lot of many employees. They employ people based on project requirements. And hence, they prefer an alternative approach that many other companies have actually utilized during their startup phase, i.e. outsourcing. Outsourcing some of the secondary tasks to other companies or freelancers can help startups to meet deadlines with minimal cash outflow.

How outsourcing and freelancing can help startups?

Most of the startup entrepreneurs prefer to outsource some of their tasks to the freelancers or hire dedicated resources for other than core tasks during the project tenure.

Outsourcing of some of the tasks provides several benefits to startups, as listed below:

1. Focus on organizational growth

Entrepreneurs can pay special attention to core tasks if their secondary tasks are outsourced to experts / dedicated resources. As an entrepreneur, you must experience the constant pressure to stay on top of industry trends, keep updated with and ahead of your competitors, and look forward. At times, freelancing, freelancer are blessings in disguise.

Most popular business tasks preferred for outsourcing are

• Social media marketing
• Customer services
• Search engine optimization
• Content marketing/copywriting
• Web development and coding
• Web designing
• Accounting and bookkeeping
• Payroll processing
• Tax preparation and filing
• Event management

Depending upon organizational core function, management decides what tasks are better to outsource. For example, if you are a digital marketing agency, you can opt for outsourcing payroll processing, accounting and tax filing tasks. On the other hand, if you are into the accounts and finance sector, you can outsource website development, website designing, and online marketing.

2. Increase inefficiency

When non-core tasks are outsourced, your productive time can be focused on organizational core tasks. Moreover, you can get done your secondary tasks from experts and skilled professionals. Furthermore, there are some of the special benefits of outsourcing. Freelancers are stoutly dependent on five-star client feedback and mouth-to-mouth advertising. In such cases, delivering high-quality projects on time is their key concern.

Most of the freelancers handle one client at a time in order to provide quality output and maintain their dependability, so you’re at the centre of their attention. So as a whole, outsourcing tasks to skilled freelancers increase the organization’s efficiency.

3. Reduction in risks

An underperforming employee is a significant cost to the company. Because they either fail to deliver timely or provide the output that is below par.

According to HR, it can take a while to get rid of an underperforming employee. In case, an organization has an obligatory long-term contract with a service provider, it can be complex and costly to avoid it if you need to.

When you prefer outsourcing, it reduces that risk, particularly for short-term arrangements while you see how a freelancer works. If a company is not satisfied with the output or behaviour of a freelancer, it has no obligation to continue with that resource or hire them again beyond the original contract.

4. Savings on cash outflows

The decision of outsourcing is a major strategic one for most companies since it involves evaluating the potential cost savings against the consequences of a loss in control over the product or service. You can employ the best and most talented workforce as freelancers within your restricted budget to get done technical tasks. Outsourcing costs form a part of your variable costs and hence your fixed costs remain static regardless of total output.

Steps to successful outsourcing and freelancing for startups

According to Richard Branson, everything in your business can be outsourced, if you are not emotionally attached to doing it all.

Are you ready to outsource your non-core or technical tasks to freelancers? Here are the handy tips on how to find a perfect freelancer to whom you can outsource.

• Determine the task which you want to outsource
• Search for freelancers on sites like Elance, Fiverr
• Check the credentials and past work of freelancers
• Establish procedures and benchmarks to get them on board
• Set expectation levels with respect to work, timeliness, quality, and payment
• Stay in touch with them during the project tenure and provide them required assistance
• Take follow-up on time to time basis
• Provide feedback

Closing thoughts on outsourcing and freelancing

Most of the millennial today prefer to take up freelance projects as compared to fix the 9to5 job. This trend is growing and is projected to show an upward shift in the coming future. A number of online services such as Elance-oDesk, upwork, BidModo and others serve as virtual marketplaces for contractors and business owners to connect and begin working relationships. Future of freelancers is indeed bright and the time is not far that they will establish themselves as an entrepreneur based on the outsourced projects in hand.

Startups should take the best possible advantage of this trend and establish themselves as a strong brand in an optimal manner. Here are a few examples of large startups that have thrived using this strategy to launch their highly-valued businesses:

• Skype
• Klout
• Appsumo
• Slack
• Staff.com
• GitHub
• MySQL
• Net2Text
• MindSpark
• Mailburn
• Opera

Feel free to share your insight in the comments box with regards to the trends of outsourcing, freelancing, entrepreneurship and startups. We’d love to hear from you.