1 outsourcing secret I learned the hard way...

31 replies
One of the biggest mistakes I made when I was beginning to outsource, was to "haggler" for a better deal.

I had gone through several courses on outsourcing and many of them said that I should tell to the freelancer something like "I have evaluated all candidates and I'm down to you and another one, but they offer this service for 20% less than you. If you match their offer, we will do business together."

Sounds like a smart thing to say, right?

Not that much.

In *reality*, it makes the freelancer feel less appreciated. They may "do the job" but it will likely be in a half-assed manner. They will think "Oh, you paid me less than I felt was right, so you deserve to get less-than-perfect results."

Especially if you are into a long-term project (like software development for development), such a mistake can cost you months of your life, thousands of lost dollars and many sleepless nights and anxiety.

You'll be running left and right trying to "patch up" the bad work the freelancer did.

The solution?

Find a good freelancer and pay them *exactly* what they ask for.

If you feel that they are not worth what they ask for, then don't hire them.

If you feel they are worth what they ask for, hire them and pay them accordingly. Then, get out of their way and let them get to work. You'll both be happier :-)
#freelancer #hard #learned #outsourcing #secret #way…
  • Profile picture of the author BrianDouglas
    I can agree with this. Bonus rewards to freelancers make them put you into priority as well. If they give you content that is top-notch and you're going to stick with them anyway, then they are doing something right. Rewarding them here and there is a great way to build loyalty, and you can eventually turn that freelancer into your team mate.
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  • Profile picture of the author Michael Oksa
    This video says it all...


    All the best,
    Michael
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    • Profile picture of the author Jesse L
      Originally Posted by Michael Oksa View Post

      This video says it all...

      The Vendor Client relationship - in real world situations - YouTube

      All the best,
      Michael
      Love it!! I am so adding this to my collection!
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  • Profile picture of the author brunom
    For me you get what you pay for. If you decide to save on things you shouldn't, you're bound to feel the effects of that later on.
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  • Profile picture of the author TheArticlePros
    [DELETED]
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    • Profile picture of the author garveyonweb
      Originally Posted by JaRyCu View Post

      No, it's not. My best price is what I offer on my website, which is about double what you see in the WFH ad. I say that that's my best price because it makes the most money for me, and I'd rather you pay that rate. Since I have a cheaper price posted, though, you're welcome to pay it instead.

      -- j
      Thats my read of the day! I'll remember that for my offline dayjob.
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  • Profile picture of the author dengkane
    Thanks for sharing.

    This is a great point, and the motivation of outsourcers will determine the quality of their outputs, and their feelings will affect their motivation, so the quality.
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    • Profile picture of the author BeechHill
      I have to agree with George here too and Brian. Want people to do their best, then pay them for what it's worth. With good outsource partners that's usually far less than the actual value for what you're getting. In fact if you want their best and move to the head of the class next time you use them, pass along a tip for great work. Goes for those Fiverr sellers too.

      A little appreciation comes back many times over. As George should know having shared a lot with this community already. Thanks George!

      Gary
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      • Profile picture of the author marioluislopes
        It makes sense but it doesn't mean that you shouldn't negotiate prices all of a sudden, you can still negotiate, what you shouldn't do is squeeze the guy who gave you the best price as it's already good.
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  • George,

    Originally Posted by George Katsoudas View Post

    I had gone through several courses on outsourcing and many of them said that I should tell to the freelancer something like "I have evaluated all candidates and I'm down to you and another one, but they offer this service for 20% less than you. If you match their offer, we will do business together."
    What I usually do is propose a counter offer, if I'm in the mood or if the client's products have potential for good sales margins, which goes something like:

    We'll gladly do this project for you at this discounted $XXX rate, along with XX% commissions per sale and/or lead that'd be generated by the materials we'll develop for you, one year upon product launch/publication. This means we'll implement our own traffic generation and offsite marketing campaigns, using our own time and resources, to drive prospects to your offers, so we can earn more commissions. Let me know...

    Since 2005, particularly in our corporate and non-corporate departments, all similar counter offers I proposed converted into short term "trial" contracts, which were all renewed to long term contracts. We recently launched this as an "official" offer in our per-order department, so we're still monitoring the results of this new per-order offer of ours...
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  • Profile picture of the author MKCookins
    Great post - I personally have not outsourced anything, but when I do I'll keep this in mind.
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  • Profile picture of the author ralchevd
    Another great thread! Also thanks to Michael for the video ;d

    I agree on this - if you want to make business as a manager, you should respect those who lead you to the money. And if you are not getting any profit out of it, then the problem is in your idea, not the outsourcer.
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  • Profile picture of the author Abraham L
    Very good tip. I'm not into outsourcing my business yet, but this really could be a game changer, and something to definitely think about.

    Thanks George!
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    • Profile picture of the author angshuy2k
      Truely said and actually for outsourcing all the anxiety and others it is of no use to haggle and pay someone less for the work they have done. I do agree to that everyone should be paid according to their work load, quality of work and of course the hard-work each freelancer do and at the same time they as well have to full fill their promises for the price they as for.

      A big thank you for posting this.

      Kind regards,
      Swrajit
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  • Profile picture of the author lastdual
    Yeah, I never haggle with freelancers unless they come in at a bid way above the stated project budget, although in those cases I usually just ignore the bid.

    The tricky thing is that with freelance work, you don't always get what you pay for. With anything ambitious, I always look for bidders who appear to have actually read my project description and display some real insight into how they would accomplish it.
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  • Profile picture of the author carolf
    I paid my freelancer a $20 tip today
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  • Profile picture of the author seasoned
    Most people, for most outsourcing, CAN'T haggle! They may think they can, but they CAN'T! OH, they may get a price that means they don't pay much, but it may be a high price. Case in point? My father told me of how he was up against a company offering to charge the customer a lot less. My FATHER got the sale! HOW?

    My father showed the customer all the stuff they would need, that wasn't quoted, and then asked "What ELSE are they missing?"! And I have been on contracts where people cut things to the bone and offered the MINIMUM, and ones that had a bigger budget, allowed a lot of scope creep, and freebies. Who REALLY got the better deal?

    And ever see holmes on homes? He rips apart and fixes homes that are built/remodeled on the cheap. The labor is NOT LICENSED, BONDED, or SKILLED. Homes are NOT inspected, or built to code. Watch it sometime! Some seemingly stupid codes have a reason, and putting copper pipes on the outside of a lobby overhang, especially when they aren't insulated and it is cold, is MORONIC! IMAGINE! They could burst, you could be without water, the home could get flooded and rot, and guests could get DRENCHED, and that is JUST what ONE contractor did!

    MORAL? If you are not a virtual EXPERT on what they must do, have experience, and lay out PRECISELY what you want, you probably do NOT want to do what those stupid courses George Katsoudas spoke about said to do. They will limit what you can expect, and you may actually end up spending MORE for he project, and getting LESS! And AT LEAST ask for mockups, or plans, on a small part of the project. MOST good contractors will be willing to do that, and it shows talent and what they are planning.

    Steve
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  • Profile picture of the author dylandiel
    Pay the price and you will get great help
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  • Profile picture of the author Strasburgo
    Originally Posted by George Katsoudas View Post

    One of the biggest mistakes I made when I was beginning to outsource, was to "haggler" for a better deal.

    {snip}

    The solution?

    Find a good freelancer and pay them *exactly* what they ask for.
    And there's the rub.

    How do you find a good freelancer?
    How do I recognize a good freelance when I see one?
    What does a good freelancer look like? sound like? act like?

    Recommendations from people you don't know?
    Recommendations from friends, colleagues, peers, but you don't know the ins and outs of their business?
    Resumes? Portfolios? References?
    Behaviorial interviewing? Round robin interviews?
    Credit checks?...

    I do a fair amount of hiring of employees and selecting vendors in my day job. Believe me when I tell you that there's no real way to predict someone's future in your business.

    Strasburgo
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  • Profile picture of the author rising_sun
    Banned
    I am also a freelancer ,a graphics designer .
    I am always satisfied by my job ,that's way I am free from such kind of tension.
    I love my job so much ,it's not means that I only love this job also it's price ,
    I think or my believe a better work can get better price or a better price can be a prize of better better job .
    So if you wanna earn best you must provide your best .
    Think about your job not price, your work will bring it.
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    • Profile picture of the author MissTerraK
      I just want to thank you personally, George!

      It is rather refreshing to see a positive post regarding freelancers.

      Normally the posts are about squeezing freelancers with a vice-like grip out of their worth, by asking for and expecting top of the barrel work for bottom of the barrel prices.

      It's not the sugar alone that sweetens the coffee, it's the act of stirring. There is no better way to stir a freelancer into delivering to you the sweetest work, than by paying them their worth!

      Excellent post!

      Terra
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      • Profile picture of the author Daniel Elss
        Originally Posted by MissTerraK View Post

        I just want to thank you personally, George!

        It is rather refreshing to see a positive post regarding freelancers.

        Normally the posts are about squeezing freelancers with a vice-like grip out of their worth, by asking for and expecting top of the barrel work for bottom of the barrel prices.

        It's not the sugar alone that sweetens the coffee, it's the act of stirring. There is no better way to stir a freelancer into delivering to you the sweetest work, than by paying them their worth!

        Excellent post!

        Terra
        Love the analogy.
        I lost a great writer do to being such a cheapo. I was impressed with her work on the first job and had to play hard ball on the next one so I lost her. It took me a pretty good deal of time to find someone else I like as much.
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        • Profile picture of the author MissTerraK
          Originally Posted by Daniel Elss View Post

          Love the analogy.
          Thank you, Daniel!

          Originally Posted by Daniel Elss View Post

          I lost a great writer do to being such a cheapo. I was impressed with her work on the first job and had to play hard ball on the next one so I lost her. It took me a pretty good deal of time to find someone else I like as much.


          I'm sorry to hear of your loss.

          At least you learned something from the experience that enables you to keep the treasure you found this time.

          Terra
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      • Profile picture of the author BeechHill
        Originally Posted by MissTerraK View Post


        It's not the sugar alone that sweetens the coffee, it's the act of stirring. There is no better way to stir a freelancer into delivering to you the sweetest work, than by paying them their worth!

        Terra
        Great analogy Terra! We Michiganders know a bit about hot coffee on a cool autumn day.
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        • Profile picture of the author MissTerraK
          Originally Posted by BeechHill View Post

          Great analogy Terra! We Michiganders know a bit about hot coffee on a cool autumn day.
          Thank you Beech! You don't mind if I call you Beech, I hope.

          Anyway, it's always a pleasure to meet a fellow Michigander, and yes we know a bit about hot coffee when the weather turns cool.

          And even better, we know about hot chocolate when the weather turns frigidly cold. As a matter of fact, I get some of my best ideas while sitting in front of the fireplace staring into a crackling fire while sipping from my cup of hot chocolate.

          Terra
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  • Profile picture of the author Dlemon
    What I do with my outsources is set expectations before they start...if I pay them what they are asking for i want "x" done and then a follow up report. When they say yes most of them will keep to their word and if not move on to another one as the pool especially on odesk is quite deep.
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  • Profile picture of the author connorbringas
    Originally Posted by George Katsoudas View Post

    One of the biggest mistakes I made when I was beginning to outsource, was to "haggler" for a better deal.

    I had gone through several courses on outsourcing and many of them said that I should tell to the freelancer something like "I have evaluated all candidates and I'm down to you and another one, but they offer this service for 20% less than you. If you match their offer, we will do business together."

    Sounds like a smart thing to say, right?

    Not that much.

    In *reality*, it makes the freelancer feel less appreciated. They may "do the job" but it will likely be in a half-assed manner. They will think "Oh, you paid me less than I felt was right, so you deserve to get less-than-perfect results."

    Especially if you are into a long-term project (like software development for development), such a mistake can cost you months of your life, thousands of lost dollars and many sleepless nights and anxiety.

    You'll be running left and right trying to "patch up" the bad work the freelancer did.

    The solution?

    Find a good freelancer and pay them *exactly* what they ask for.

    If you feel that they are not worth what they ask for, then don't hire them.

    If you feel they are worth what they ask for, hire them and pay them accordingly. Then, get out of their way and let them get to work. You'll both be happier :-)
    I agree with this, you want quality content for a reason-dont scam people if you want quality. On a side note, I always find that outsourcing is never the best solution. If you have time, write your own content.
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  • Profile picture of the author bigdaleln
    I would never haggle over price to get the work done because I do not have time to do it myself or I can't do it period. I can spend a little time shopping price and quality and get the most for my money.
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  • Profile picture of the author john Roberts
    yes! I take care of my outsourcer she makes my life much easier.. I also give her bonuses when i make more then i thought i was going to make.
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  • Profile picture of the author Dr MaxIM
    This is true, but there is a very high percentage of freelancers who deliver very poor quality even if you pay them what they asked for.
    From my experience, out of 10 only one or two would be the real asset.
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    • Profile picture of the author MissTerraK
      Originally Posted by Dr MaxIM View Post

      This is true, but there is a very high percentage of freelancers who deliver very poor quality even if you pay them what they asked for.
      From my experience, out of 10 only one or two would be the real asset.
      I'm sorry that you have had such a dour experience in hiring freelancers.

      Rather than just using the tired old cliche of you have to kiss a lot of frogs before you find your prince, may I ask if you considered prior samples of their work in conjunction with client feedback first?

      Terra
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      • Profile picture of the author cashp0wer
        I would much rather pay my writers well so I know I will get good work from them. It has worked out well for me so far.
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