Advice for Small Businesses Considering Freelancer Help

Small business are a powerful engine of the US economy and entrepreneurs that build them from the beginning are often hailed as heroes. At the very beginning they were probably masters of all trades, taking care of many aspects of ruining a company. However, as their businesses grow, entrepreneurs must bring on additional help to manage growth and focus their own energies primarily on the ideas about new products or services, getting new customers or dealing with the competition.

Hiring additional employees is not an easy thing and often poses significant risk to small businesses. Besides finding the right person, owners must consider whether they can afford an additional employee, how will they manage them, and many other factors.

While hiring sometime as an employee could be a challenge, hiring a freelancer may be an easier way to scale up.

Businesses are increasingly embracing external resources and freelancers, realizing the many benefits of using contract workers for their needs. Freelancers are already a major part of the US labor force. Over the next five years 20 million people are expected to leave the full-time jobs to and join the ranks of freelancers. Any business that is not tapping into this talent pool will find itself dealing with a talent shortage.

The primary benefits of engaging a freelancer are the flexibility and cost savings. Freelancers work on demand when needed allowing small businesses to ramp up and down their resources and spend levels. Further, small businesses can pick and choose resources with specific skills and experience, reducing the training requirements.

While hiring a freelancer sound like a great idea, many small businesses are not very well equipped to take advantage of this large and flexible resource pool. Nearly half of all businesses and a vast majority of small businesses are still not prepared to bring freelance help into their organizations. They still focus on hiring new employees who get paid an annual salary rather than paying resources for project based deliverables. True, pretty much everyone today will consider hiring external help with some web development or graphic design. But for most other tasks small business owners do not consider freelancers.

However, there are a few things that a business can do to ensure successful engagement with a freelancer. As an owner, here are a few things you could do to prepare your businesses for freelancers.

1. Define what you want done

Be very clear and specify what you want done before you start looking for a freelancer. It helps to write down specific things that you would like to have done at the end of the engagement. Being organized and explicit in terms of your requirements will ensure that during the search and negotiations process with a potential freelancer you will give them as much information as they need to provide the right proposal. Nothing ruins a project as forgotten requirements that need extra work or money.

2. Know where to find the right freelancers

Finding talented freelancers can be complicated. Indeed, you will be looking for the expert who can solve your problems without being hired full-time. However, if you have a network in place from the start, it’s easier. Ask other business owners or colleagues for referrals, and use online freelancer marketplaces to build a core group of reliable freelancers with diverse skills that you can turn to every time you need work completed. It would be helpful to set aside at least a few minutes to speak one-on-one to each freelancer that is bidding on your project before making a hiring decision. This can help avoid freelancers who are not suitable and will not be able to deliver results.

3. Set up paperwork

As you prepare to hire a freelancer, you’ll need to have paperwork in place that will address all of the regulatory requirements for working with freelancers. You’ll need to have a completed W-9 form on file for each freelancer, as well as a bookkeeping process that tracks each dollar you pay for reporting to tax authorities. If in doubt, you should have a bookkeeper and HR expert review your forms, accounting processes and paperwork to ensure you’re above board with everything you’re doing.

4. Have clear timelines

Before you start your search you have to have a well-defined timeline and know when you need to get your project done. Having the end in mind will allow you to manage work delivered by external resources. Make timeline a part of your contract with your freelancer. Ideally your timeline will contain several interim check points to ensure that progresses on schedule to avoid any last minute surprises.

5. Know what "good" looks like

Figure out what "good" end product looks like. You can ask for samples of work from prospective freelancers. These samples may help you to clarify what “good” end product should look like and who has the experience to deliver it.

6. Set targets

Explain to your freelancer how you plan to use what they will deliver. You are hiring someone for their expertise, so do not be shy to ask for their advice and explain your plans. They may provide suggestions or point out potential pitfalls, allowing you to avoid disappointment and rework if the end product does not fit your needs.

7. Set budget

Determine how much it is worth to you. Be realistic in setting of your budget. While you do not want to overpay, setting too low of a price ceiling may push you to pick someone based on their price rather than experience and ability to deliver. It is best to set a range for your budget. Ask potential freelancers to explain how they determined their price because it may also highlight any missing considerations from your budget determination.

8. Consider culture fit

Working style is often not taken into account when selecting a freelancer. Small business owners will spend a lot of time to ensure that a new employee fits into the company culture. However, when selecting a freelancer this is often overlooked because it is not perceived as important. Freelancer will be effectively part of your team for the duration of your engagement, so do take time and evaluate your and their working styles to find the right fit, not only based on skills but also based on personalities.

9. Prepare your team

Your team will need to work and manage freelance workers on a project or some part time assignment, which can be complicated if your freelancer is working remotely. Coordinating on-site team members and telecommuters, whether they’re salaried or contract, can be challenging, so it’s important to find someone who will take the responsibility seriously. The manager should at least have a working knowledge of the duties that will be assigned to freelancers -- which isn’t always possible, especially if a business needs specialized work.

10. Choose technology

Your freelancers will need some technology tools to do their work productively and communicate with your team. You’ll likely need a cloud based collaboration platform that lets team members to work together no matter where they are. You’ll also need a way to communicate face-to-face with those workers, especially if getting together in person is out of the question. A video chat service for multiple meeting participants is essential when working with freelancers and salaried employees who aren’t in the office. Finally, consider how you’ll pay freelancers and put resources in place that will make it easy to ensure contractors get paid in a timely manner.

Over the next few years freelancers will become an essential part of operating a business. It's important that small businesses start preparing for the trend now. By researching as much as possible about what your business needs to legally work with freelancers, you can start to ready your environment for a new way of hiring talented experts on demand. After a few successful projects you will get much more comfortable with your extended team.

Join us and find the right resources for your business needs.