As a Long Tail Pro user, you may be a freelance marketer or an agency. You may even be running a solo business where you’re effectively your own VP of marketing!
If so, we all have something in common — hiring subcontractors.
If you aren’t looking at the potential that subcontractors can offer your freelance business or agency, you are missing a big strategic opportunity, no matter how barebones your operation. In fact, using subcontractors effectively is a way to compete with larger operations when you can’t afford — and don’t want — a big payroll.
If you’re a freelancer yourself, you probably don’t need to be told how quickly this workforce is growing. We study this a lot at Nation1099, and according to our analysis of all the available freelance studies and stats, 11 percent of the U.S. workforce is full-time freelance.
That means “self employed” as a group is bigger than any single employer in the country. We are bigger than Walmart and bigger than the federal government.
And if any business owners are reading this, it means 1 in 9 of your former employees is now a freelancer.
It also means 1 in 9 of the prospective talent pool has no interest in your W-2 job ad. If you need help, you almost have to make hiring freelancers part of the plan.
Another trend in the growing freelance market is that the hiring side of the equation is also changing. Increasingly, freelancers are hired by other freelancers. I call this peer-to-peer freelancing, and it takes two basic forms.
First, we may hire one another to work on our own businesses. For example, I may need someone to develop my brand strategy for my solo business, and I may need someone else to implement a chat function on my website. Naturally, because I’m a freelancer myself, I know the value of turning to freelancers for that support.
Second, we are hiring one another to join forces on client work. For example, as a marketer, I might bring in editors, proofreaders, designers, social media strategists, marketing technologists, and writers . . . lots and lots of writers.
Someone offering another professional service will bring together a different team freelance colleagues to support their client work. For example, a freelance web dev might bring in SEO specialists or online community managers or a site audit specialist.
One method for joining forces as freelancers is to “bring them to the table” and have the client hire each of us separately.
But increasingly the model is for someone like myself to assemble the team and to act as the primary contractor — the prime — and to be responsible for the relationship with the subcontractors — the subs.
Over time, in my own content marketing business and through the community at Nation1099, I’ve developed an approach to working effectively with subcontractors. I want to share a few of the highlights with you here.
1. Your long-term goal should be to build a up a great team
For the rest of this article, you’ll see me referring to the subs I work with as my team.
Of course, they aren’t mine at all in the sense that an employer with W-2s on the payroll would say “my employees.” They are freelancers, after all. They can do anything they want, and they have many other clients who have a claim on their time.
Nor can I promise my team anything beyond the current project. In some cases, I can go a couple years or more without working with a valuable member of my team just because the right job hasn’t come up.
But when we are working together, I want us all pulling in the same direction. Generally, that means I want them on brand and on strategy both for my business and for my client’s business.
I also want the prospective client to have a good impression and to have confidence that we can do the job.
So my goal over time is to build an increasingly well cultivated network of freelancers. I’m going to communicate with them regularly no matter what, and I’m going to encourage them to communicate with one another.
What this looks like in practice: Give well-crafted paid test assignments. Try
a lot of people. Have patience. Try them once more. For the ones who aren’t a good fit, graciously let them know that you won’t be able to use them. For the rest, steadily onboard them to your systems and introduce them to the team with more and more assignments.
2. Build a great team by being a “client of choice”
Have you heard the term “employer of choice”? It’s essentially an approach to talent management that recognizes that companies are in a talent war.
Workers have choices, and they don’t want to work for employers with ugly behaviors. To get the best pool of job applicants and to keep employees engaged, you have to be better than their other choices.
The same goes for working with the growing freelance workforce, so now you need to be a “client of choice.”
My goal is that every sub I work with feels that I am their best client. Even if their other client is a Fortune 500 company. It doesn’t matter how prestigious their other clients are. When it comes to being good to work with, there’s no reason I can’t compete.
I want my team answering my emails when I need their attention.
I want my team putting our work at the top of their to-do list every Monday morning.
I want my team thinking to send me the status update email on Friday afternoon.
If someone on my team gets busy and has to tell a client, “This is going to be a couple days late,” I want it to be one of their other clients.
To achieve this, I do everything my budget and my schedule allows to make sure every member of my team knows I value their work. They all get Christmas cards. They all get recommendations on LinkedIn. They all get retweets of their work for their other clients and of their side projects. They all get white papers and articles that I think will be helpful or interesting to them. They all get funny videos. And they all get referrals for work that I’m passing on.
In short, they all get regular reminders that I’m thinking of them and am rooting for their success.
Most of all, I answer their emails. When subs who I have worked with reach out to me, they hear back. The dumbest mistake I see clients make with freelancers is only being in touch when they need something. It’s amazing the number of clients who expect freelancers to jump when they have urgent work but who don’t have the courtesy to answer a professional email from us.
Freelancers increasingly are in the driver’s seat when it comes to pricing. The community at Nation1099 talks a lot about strategies for raising freelance rates, and these clients — not clients of choice — are the first to get shoved off the back of the train.
To work effectively with subs, have a goal of being their best client.
What this looks like in practice: Communicate a lot.
3. Connect your subs to your clients and let them work together
A lot of primes (and agencies) worry about subs stealing their clients way.
I prefer to see that as a goal, within certain limits.
First of all, every contract comes to an end eventually. For what I do, it’s usually because the client grows to a point that they are building an in-house team that makes my work unnecessary. In that case, I strongly encourage the client to keep on the writers and other people in my network. Helping my team succeed has paid real dividends a couple years later in referrals.
As for subs and clients cutting a side deal that leaves me out, it has never actually happened. If it did, wouldn’t it just be a symptom of another problem? If a client feels that a freelancer doesn’t offer any value beyond the direct service such as writing, illustration, or copyediting, then this isn’t a solid relationship anyway. The freelancer is just a middleman driving up their costs.
The whole point of using subs is so that you can be a prime doing something that is uniquely valuable. In my case, I offer a complete editorial process and oversight. That’s not physically possible if I’m also a writer — not without a time machine. If all my clients feel that all they need is writing, then I haven’t really sold them on my value.
In that case, there really wouldn’t be any work to steal.
What this looks like in practice: You do you. Concentrate on how your services are uniquely valuable, build the team of subs who help amplify that, and don’t worry about the rest.
4. Look everywhere for subcontractors
As a freelancer yourself, you probably know those platforms and websites where you can hunt for work? Now as a prime you are potentially on the hiring side of those markets.
As we discussed above, talent is getting harder to find, so you’ll have to be creative and be persistent. Some of these marketplace sites can feel like entering an unfamiliar bazaar.
My own approach is make peace with how time consuming that is and to just outhustle the competition trying to find the best freelancers.
I’ve even put out a cattle call on Craigslist ads to attract inquiries from interested freelancers. That’s how I found my assistant editor, who has been essential to my team the last couple of years.
I’ve also had some luck reaching out directly to writers whose published work I noticed and thought illustrated the approach I need. (Our clients demand a lot of research and even original reporting.) I reach out directly with a short note and ask if they’d like to chat.
If you’ve been on Upwork and places like that, you know the advantages and disadvantages already. What you may not know is that many competing sites are emerging with innovative business models and different niches. We maintain a list of the most interesting of these freelance websites and marketplaces on Nation1099. Some of them curate both the freelancers and the clients to make the marketplace more selective. Others structure the payment terms to incentivize good work rather than incentivizing a race to the bottom. So I strongly encourage you to look at some of the alternatives in your hunt for subcontractors.
What this looks like in practice: In short, to build up your team of subs, look everywhere and be more persistent than your competition.
5. Organize around an effective subcontractor agreement
Okay, those are some of the general principles to live by. Let’s get into the details a little more.
The best way to do this is to orient your thinking around the written agreement you’ll have with your subs. At Nation1099, we have several subcontractor agreement templates you can crib from. Let’s walk through a few of the elements that I’ve found are most relevant to marketing work.
A lot of it will be the same as in any other scope of work document:
- Description of the service
- Fees or rates
- Who is responsible for expenses
But then there are a few additional elements to the subcontractor agreement that recognize you have a relationship with a third party.
Your payment terms should make clear what counts as delivered and when you will pay the sub relative to that delivery.
That’s because you will sometimes get into a situation where you accept work from the sub as complete but then later find that the client wants revisions. It might be a change order. Or it might be that they have a reasonable difference of opinion about the quality of the package you are delivering.
In any case, you need to keep the client happy by revising the work. But if you have already “accepted” the work from the sub, then you owe the sub the payment without asking for revisions. If you anticipate needing revisions, then your agreement with the sub needs to make clear that acceptance of the work and payment will be in suspense for some extended period.
In short, you need to decide if the sub only gets paid after you get paid or if you are going to pay up promptly regardless of what the client does.
If you are paying the sub on a project basis, then the payment terms should include an hourly rate for overages or work outside the scope, which will help in this situation. You can go back to the sub and ask them to deal with the revisions and to invoice you at the hourly rate.
Sometimes clients change their minds about the deliverables. They’ll ask you, “Can we do it this way instead of that way?”
Which is fine when it’s just you. But if you already put a sub to work on their part of the project, then you have a problem. If the sub has put even a few minutes of work into this, they’ll feel it isn’t fair to ask them to halt work without compensation.
I like to use a concept from the days of magazine writing when it was common for freelance writers to be put on an assignment months ahead of a publication date. If their editor revised their plan for an issue, they would tell the writer to cease work and to take the “kill fee.” This was a payment of 25 percent or 50 percent of the promised amount. Sometimes the kill fee was tiered based on when the story was killed.
I like to include a kill fee provision in the subcontractor agreement. I have ended up paying it to people on my team a few times when they have started researching but haven’t yet started writing. If a client comes to me during that period and wants a change, I agree and then tell the writer to pump the brakes and to invoice me for the kill fee.
If the client wants a change after that point, I tell them they are asking for a change order that will cost them, either in an extra fee or in a decrease in the deliverables. I have expenses to my team I’m already committed to.
This goes in two directions. Confidentiality about the client and confidentiality about you.
Whatever agreement you have with the client about confidentiality needs to be passed on to the subs. Make sure your subcontractor agreement makes clear how they should treat research, work product, materials that have been shared, etc.
If there’s a non-compete element to your client work, then you need to address if or how that applies to your subs.
I don’t recommend getting into non-compete situations to begin with. The whole point of being a freelancer and having a niche is to know your field very well so you can provide immediate value to your client. That’s only possible if you can work with other clients in the same industry.
Meanwhile, you will have your processes and research for your freelance business, and you should ask your subs to keep that confidential.
Intellectual property and credit
If your work for the client is “work for hire” where they own the deliverables, then you need to make sure that you roll up the work of your subs under the same terms.
Related to that is the issue of credit. This certainly comes up with freelance writers, though it may be different in professions I’m less familiar with, like design or engineering.
That’s because those of us who come from the journalism world are used to a world where work-for-hire was less common. Instead we often were selling “first publication rights” to the magazine or newspaper. We retained ownership and the right to sell it again. And the custom in journalism is to always have a byline indicating the author.
When veteran journalists get into content marketing — which look a little like journalism on the surface — it can be a surprise that the custom is exactly the opposite on both those issues.
My own subcontractor agreements include a line indicating that the client owns the work. It also states that the client retains the right to publish the finished piece without an author credit or to publish it under the byline of someone else. They also retain the right to publish it elsewhere than on the client’s own blog.
Then separately from that, I strongly encourage the client to give byline credit unless this is a true ghostwriting situation. Advocating for my team in this way is part of the principles outlined above.
This is where you make clear that your subs are in fact freelance rather than employees either of yourself or of the client. You don’t want to get into an employment classification lawsuit.
As a freelancer yourself, you’re probably already very familiar with the rules about classifying a worker as a contractor rather than as an employee. You need to pay attention to the other side of this relationship when you are a prime.
Essentially, make sure the relationship is temporary and deliverables-based and that you are not controlling how the sub spends their time or spends their resources. And then make sure your agreement with the sub clarifies that.
This is about growth, not flexibility
If all of this sounds a little ambitious, that’s understandable. In essence, when you set yourself up as a prime looking for and managing subs, you are entering a talent war to some degree. Talent wars are cyclical, and right now there is more demand than supply.
But when you think about it, the reason there is a talent war is that there is a value in it. Clients want good help because they need it. If you can help deliver that help by putting yourself in the role of a prime, then you have an opportunity to add even more value to your clients and to grow your own business.
As I said at the top, that’s the real upside of the growth of freelancing. It’s not about reducing your costs and increasing your flexibility. It’s about extending your business strategy into a more profitable area. Building a great team of subcontractors is one way for your freelance business to build a competitive advantage.
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