From the June 2010 issue of Startups

You don't have to go all the way to India or Asia--or be a big company, for that matter--to try outsourcing and reap the benefits. In fact, knowing when and how to outsource a project or problem by calling in freelance talent can be the salvation of a startup's harried founder or the small entrepreneur pressed for time and capital. There's always something new to learn or manage. And increasingly, stressed-out small business owners are looking for smart, cost-effective ways to profit from the new without making it an overriding preoccupation. Here are some tips:

Why use freelancers?
Most business owners need to call in additional help at some point, whether it's marketing expertise, web design, or virtual assistance to handle the backlog of emails and administrative tasks. Sometimes, employing a freelancer is the best decision so it can free you to do the things you do best and enjoy doing. At other times, you may decide to get help in an area that would be far too time-consuming for you to learn, such as HTML coding or QuickBooks.

What are the payoffs?
Done well, hiring freelancers can help you enjoy the satisfaction of being your own boss as well as make your business more efficient and profitable, faster. Finding the best freelancers or contractors isn't easy, and you want to be confident you are getting the services you need for the right amount of dollars.

How can I make it cost effective?
When you start to look at the hourly rates for hiring freelancer, they seem higher than if you hired someone locally. However, you need to realistically evaluate if hiring freelance assistance is more cost effective than having a live and in person staff member.

Consider this cost analysis on the true wages of a staff member making $13/hour:

(Cost based on 1,960 productive hrs/yr)
$13.00/hour-Employee wage
$ .53/hour-Two weeks of vacation time
$ .27/hour-One week sick time
$ .48/hour-Health insurance
$ .99/hour-FICA (7.65% of wages)
$ .42/hour-Unemployment insurance (3.25%)
$ .77/hour-Desk, chair, computer, supplies
$ .32/hour-Holiday pay
$ .06/hour-Placing a help wanted ad in the paper
$ .10/hour-Your time spent interviewing candidates
$ .03/hour-Profile test
$ .08/hour-Payroll processing
$ 3.06/hour-Office rent (based on $500/month rent)
$20.11/hour-Total cost

Where do I start?
One of the most frustrating things for freelancers is to be interviewed by a client, only to find that the client doesn't really know what it is he or she needs. Take some time and brainstorm some clear needs that you have. For example, needing help with your bookkeeping isn't acceptable; be more specific. You need last year's accounts reviewed and then help setting up this year's books. You don't just need help marketing; you may need assistance evaluating your current marketing efforts with recommendations, or someone to manage all social media marketing efforts or write simple press releases every month.

Where can I find freelancers?
There are a variety of sites to choose from, including eLance.com , oDesk.com and HireMyMom.com . Keep in mind that each site attracts different types of freelancers. You may find it easier to work with one site once you become familiar with it. "I use freelancers exclusively from HireMyMom.com. I initially tried several different sites and then found one site that I was comfortable with and that consistently had freelancers with whom I worked well," explains Laurie Cohen, president of Deerfield Marketing Associates / ForBrideandBaby.com .

Can I solicit bids on a freelance project?
Yes, a number of freelance sites provide an opportunity for you to post your project, then have freelancers bid on them. Be wary of considering the lowest price as your first choice. Instead, consider the qualifications and experience you want and need first. "My advice for finding ideal freelancers or contractors to work with is to determine your specific needs and share that information when posting your job or project. Also, ensure the candidate(s) you choose to work with meet the needs of your business AND are people you genuinely like to work with," explains Maes.

How is it different from hiring someone in the office?
Because this is a virtual working relationship, you need to take time to make sure you and the freelancer make a good fit. It is not quite the same as having someone sitting next to you in the office so you really do have to feel that this person has the right experience, and you can trust them to deal with your work.

"I like to chat online with freelancers for a bit before hiring them to see if our communication style is similar and to judge response time and skills. I highly recommend this before hiring anyone," explains Cohen.

How do I set deadlines?
Instead of simply handing over your books or copywriting needs for all eternity, decide on a specific project with a clearly defined schedule and payment. Put your expectations and compensation in writing. Include information such as how often you want the freelancer to check in and if the project fee includes revisions, and if so, how many?

At the end of the project, whether it is in a day or three weeks, then you can better judge if you want this to be a longstanding commitment. Evaluate his or her skills. Was the job done well? If you need revisions, are those done quickly and appropriately? Were suggestions taken easily or was the person offended? Was it a good value for your money and would you work with that person again?

What are some of the tasks that can be outsourced?
There are literally hundreds of job responsibilities that a small business owner can delegate to other professionals. Consider which of these tasks could be delegated:

Customer Relationship Management

  • Answering service
  • Voice mail management
  • Email management
  • Telemarketing
  • Customer Service/Order Taking
  • Live IM Chat Support

Other Administrative Tasks

  • Power Point Presentations
  • Data entry
  • Personal Assistant (calendar management, travel planning, setting appointments, etc)
  • Newsletter design, creationand maintenance
  • Desktop Publishing
  • Copywriting
  • Spreadsheet creation/updates
  • Transcription

Website Design/Maintenance

  • Content Management
  • HTML Coding
  • SEO Optimization
  • Google Analytics
  • Add/Edit email accounts, newsletter subscriptions
  • Managing online store
  • Custom programming
  • Install online chat/discussion boards

Marketing/Creative Tasks

  • Logo/stationery design
  • Market Research
  • Marketing plan execution
  • Managing advertising design/writing
  • Social marketing management (twitter, facebook, etc)
  • Forum Moderation

Operations/Accounting

  • Quickbooks
  • Invoice management
  • Legal assistance/Paralegal tasks
  • Translation

How do I know what to outsource?
Ask yourself these questions:

  • What part of your business excites you the most?
  • What areas do you consider yourself an expert in?
  • What area of your business do you dread working on and gets neglected?
  • The biggest need you have right now is what?

How do I factor in the time demands?
Again, ask yourself several questions:

  • What specific tasks take more time for you than they would an expert? (For example, creating excel spreadsheets take significantly longer if you don't use them often.)
  • What simple tasks could you hand over right away?
  • What tasks take a great deal of time but do not require your particular expertise?

Are there specific websites for finding certain skills?
Yes, and the number is growing by the hour. These websites generally represent a wide variety of freelance professionals, from virtual assistants, web design and copy writing and even legal and accounting services.

Writers

For graphic designers/Creative jobs

IT/Web design freelancers

Accounting/Bookkeeping Services

Translators