Raise your hand if you’ve been burned by a freelancer before!
For whatever reason, the freelancer sold you and took you to your promise land, only for the mirage to be shattered and you to be left broke and without the deliverables that you agreed upon.
Since you’ve been shafted before, your thoughts automatically populate with all the outsourcing risks you can think of when you go to outsource again. Which is likely, since over 1/3 of small businesses outsource something.
But, it’s understandable to have some hesitation and trepidation.
Now, as a freelancer myself, I can’t consciously plop all the blame on the freelancer.
There are many reasons why a freelancer and a contractor should not have a working relationship.
Not every freelancer should be working with every client (for many reasons). But, that’s a conversation for another day.
Getting burned is NOT a fun experience and it can be difficult to overcome, but the more outsourcing risks that you’re aware of going into the process, the more you can try and avoid it.
Be Aware of These 11 Outsourcing Risks
In this article, we’ll go over these 11 outsourcing risks:
- Intellectual property and copyright violations
- The budget goes overboard (hidden costs)
- The deadlines aren’t met
- The freelancer isn’t qualified
- Getting sued
- Your future reputation
- Lack of control over the process
- Geographical and timezone differences
- Language barriers
- Unknown subcontracting
- Apathy
Let’s dive into these topics a little more!
1. Intellectual Property and Copyright Violations
It’s really important to vet your freelancers and get testimonials from them on the quality of their work.
Otherwise, you might get a freelancer that violates intellectual property and copyright laws.
Let me give you an example…
A freelance writer could copy what’s on the first page of Google instead of creating original content (you should make a practice out of running it through Copyscape).
Without you knowing but since you published the piece, you’ve violated someone’s copyright.
That’s just a yucky position to be in, but it’s one that you should be aware of since it is a risk of outsourcing.
You also should have a clause in your freelance contract that dictates who owns the intellectual property after the term of the contract.
For example, it’s common for website designers to place their website in the footer so people know they created it. That’s something that you should be aware of before hiring a web designer because not complying with their terms will never have good implications.
2. The Budget Goes Overboard (Hidden Costs)
Most online entrepreneurs and bloggers have a specific, set budget to outsource with.
I get it…
Sometimes, the cash flow isn’t flowing as well as you’d like it to be.
You need to always cushion the rate you’re paying a freelancer in case there’s overage.
For example, a software developer may quote a set number of hours for the top-secret, backlink-building tool you want to put on your site. But, that estimate could be off.
If the developer knows their stuff, it shouldn’t be off by much, if at all, but it’s something to plan for.
A few extra hours may cost you upwards of $200 and if your budget is tight, that will present an awkward conversation.
There may also be hidden costs that aren’t revealed in the scope of work.
You may find yourself paying for a license to a premium plugin to help execute a site redesign that you didn’t know you needed.
Most freelancers are transparent about all the costs involved. Despite that, don’t assume anything.
If you outsource Facebook ads management to an agency, you’re paying for the labor to manage it and for the ad spend. And, if your ads are hot, you may want to ramp up on spending.
If you haven’t allocated the proper funds, you can’t do that (which means you may lose out on sales).
3. The Deadlines Aren’t Met
You may have a schedule and that’s all fine and dandy.
But, have you thought for a second on what happens if the freelancer doesn’t meet the deadline?
Most freelancers are upfront if they can’t meet a deadline.
But, for super time-sensitive stuff, you’ll want to confirm in advance that the deadline is realistic and can be accommodated.
While we’re on the topic of deadlines, if your deadline is ASAP, that’s incredibly unhelpful and useless.
Please remember that freelancers have other clients and have other demands that they have to meet.
Always AGREE on a deadline.
For example, I’m trying out a test piece with a freelance writer. I’m giving a week between the assignment to the outline and the outline to the draft. Same timeline if revisions are required.
But, I said…
If you need more time delivering the draft, let me know. The piece is in no rush.
Quality can’t be rushed.
If you are insistent upon immediate delivery, be prepared to pay a percentage higher for the services.
While deadlines shouldn’t be fluid, you should understand that one of the risks of outsourcing is not receiving the deliverable by the agreed-upon date.
You should have a backup plan, or, even a standard operating procedure (SOP) for when that happens so you handle it professionally.
4. The Freelancer Isn’t Qualified
Sometimes, the freelancer simply isn’t good.
An international writer (or even American writers…I’ve seen some crazy versions of “English”) may hand in a piece laden with grammatical errors, even though that was not what you requested.
And, you’ve now learned your lesson and won’t outsource to them anymore (yes, you still have to compensate them).
But, there are bigger demons at play when it comes to quality.
Or, should I say qualified?
In this internet age, not all freelancers have the qualifications they tout.
Make sure to do your due diligence. Look at their LinkedIn profile or portfolio. See if you can find evidence of what they allege.
You shouldn’t be paying big bucks for a bookkeeper that claims they’re certified in QuickBooks Online and from a bookkeeping course if they don’t actually have any evidence to support that.
That’s why I like using referrals for outsourcing.
I let someone else do the vetting for me.
If you’re hiring a freelance writer for a piece on retirement investing, that writer better actually have the CFP certification they claim. Otherwise, you could be publishing misleading information.
NEVER hire a freelancer impulsively.
If you ever have any doubts, send me an email and I will be happy to clear up any confusion.
5. Getting Sued
Please note that I am not a lawyer and cannot provide legal advice.
Now that we’ve got that disclaimer out of the way, here’s what I have to say on this matter.
Getting sued is not fun.
You probably already know that. Thankfully, I have not had to deal with it personally.
But, as a freelancer and as someone who outsources, it’s always something that I’m aware of and keep in mind.
Of all the outsourcing risks, this one is probably the one you should attempt to prevent AT ALL COSTS.
A few pieces of advice:
- Have an iron-clad freelance contract with an indemnity clause that protects you (I actually prefer mutually-indemnifying)
- Vet your freelancer’s work before publishing it in any way (that could be Copyscape for writing, for example)
In the event that you DO get sued, the first thing you should do is contact a licensed attorney in your state.
Before you respond to the notice.
The lawyer will be able to guide you. Just know they cost a pretty penny, so try to avoid this, if possible.
6. Your Future Reputation
I think bloggers, in particular, are FIERCELY concerned with their reputation.
Understandably so.
Their affiliate income may plummet if they advise incorrectly because of a misleading recommendation that wasn’t researched properly by a freelancer.
Typos left by a proofreader may put the blogger under scrutiny from sensitive members of their audience.
You should know in advance that if you outsource, you ARE putting your future reputation at stake.
The way you mitigate that concern is by vetting your freelancers and only hiring quality (and qualified) ones.
7. Lack of Control Over the Processes
If you’re a perfectionist, you may want to read slowly and take a deep breath.
One of the biggest benefits of outsourcing is that you don’t have to perform the tasks.
That means you won’t know the full developmental process on the freelancer’s end to reach the final product.
It’s honestly a mindset thing. You need to learn to channel those negative thoughts elsewhere.
If you are SUPER picky about how you like things done, make sure you discuss that with the freelancer prior and that they’re on board.
That’s why I sent the freelance writer I hired editorial guidelines and asked for any questions.
Documenting your workflow, standardizing the process, and streamlining its execution should all be done BEFORE you even think of outsourcing.
If you don’t know your processes, start observing what you do and write it down.
And, if you don’t know what you do to reach the final product, how do you expect the freelancer to know?
I hear many people who outsource that say their freelancer didn’t do things the way they wanted to. Sometimes, that’s true. Usually, it’s not true. It’s an issue of not really knowing what you want.
Please, don’t obsessively check in with the freelancer.
Trust the process that you’ve set up and the deadlines that you agreed on.
8. Geographical and Timezone Differences
Meetings may prove to be challenging if you’re in a timezone that’s drastically different from your freelancer’s. Usually, the difference between EST and PST won’t be an issue, but make sure you clarify the timezone.
It may severely impede communication.
Not only between you and the freelancer, but between you and your customers.
If you hire someone for customer service and they’re 12 hours ahead of you, your customers’ questions will get answered during the part of the day when the customer won’t be checking their email.
You could be criticized by someone saying that your customer service is always slow.
No one wants to unnecessarily be criticized.
Also, WiFi may be drastically different from country to country.
An internationally based Pinterest manager may potentially get your account blocked if they suspect the login from a different part of the world is caused by hacking.
You just never know, especially with how fickle Pinterest is.
Now, don’t go expecting the freelancer to meet with you in person unless you specifically agree to that with the freelancer. Most are remote for a reason.
9. Language Barriers
Effective communication is one of the most POWERFUL things to witness.
It’s inspiring. It’s actionable. It can even be life-changing.
Struggling to communicate with your freelancer because they don’t fully understand your language is not effective.
It’s a waste of money.
If the freelancer can’t understand those beautifully documented processes you spent quality time on, then the final product won’t be what you’re looking for.
Test an international freelancer’s fluency before hiring.
If you’re reading about them on a job board, look to see the composition of their profile.
Think to yourself…
- Are the sentences complete and not fragmented?
- Are there grammatical or syntax errors?
If you have any hesitations, don’t engage in services with someone you can’t communicate with (or that your customers can’t communicate with).
I’m not talking about the British or Australian variations of certain words. I’m talking about communication at its core.
If you think someone might not be the right fit to outsource to because of this, you’re entitled to think that. And, you may want to gently inform the freelancer of this so they can improve for the future.
If you do decide to hire someone international, understand upfront that it can be risky.
10. Unknown Subtracting
Are you familiar with the term subcontracting?
If not, I’m happy to explain it to you.
Subcontracting is when a freelancer takes the task you’re paying them to do and then outsources it to someone else, usually at a lower rate so that they can make a margin.
Essentially, the freelancer becomes a middle man.
This process is commonplace for agencies. You know the founder of the agency isn’t doing all the work.
For example, my favorite WordPress maintenance company subcontracts their tasks to freelancers. They have to with the sheer volume of clients they have.
As long as the work is quality (and Grayson’s freelancers are), there isn’t an issue.
But, it’s the subcontracting you don’t know about that can be detrimental.
For example, a very busy freelance writer may subcontract an article to another. So, you may be getting another writer’s voice which doesn’t fit your brand and from the perspective of someone other than the qualified freelancer you hired.
It’s something to be aware of.
In my independent contractor agreement, I make it public that I don’t subcontract tasks. My clients seem to resonate well with that.
11. Apathy
I care A LOT about the work that I put out.
It’s my reputation at stake.
But, not all freelancers share the same sentiment.
To some freelancers, you’re just another client that they have to satisfy.
I know that can be somewhat harsh to reduce it to that extreme, but sometimes, that’s what freelancers think. “This is paying my bills” is not an uncommon reason for accepting a gig.
When I outsource, I try and find freelancers that are invested in the final product.
These are people that share the vision for my site and are excited by my mission.
I think one of the BEST ways to fix this outsourcing risk is to hire people from your own audience.
You never know who might be lingering in your email list and/or Facebook group that would be a perfect fit for a certain job.
Typically, if they spend the time to read about your latest and greatest, they’ll be committed to the final product.
I, for one, am happy to train a freelancer if they show undeniable enthusiasm about the opportunity they’ve been given. I will not, however, show mercy to freelancer that couldn’t care less about what I stand for.
Just my $0.o2.
Let me know in the comments below if you’re like that, as well!
FAQs Concerning These Outsourcing Risks
I’m sure you still have questions.
I would if I were in your shoes.
So, I did what any sensible person would do and searched Google for the keyword and then copied the questions that people also want to know. So, in a very particular order, I hope these questions assuage your concerns.
1. What are the Disadvantages of Outsourcing or Offshoring?
You could consider all of these outsourcing risks as disadvantages.
The terms are rather synonymous in that respect.
But, I wouldn’t say that there’s a disadvantage that should prevent you from outsourcing.
If I had to take a stab at what the biggest disadvantage of outsourcing would be, I’d have to say it’s the time that it takes to hire someone.
Whether it’s searching through countless job board profiles, begging friends for references, and asking your own community, that’s time that you could spend on higher ROI tasks (or even the task you want to outsource if you can perform it properly).
Provided you’ve positioned yourself properly to succeed at outsourcing, it should be a breeze after you sign the contract.
Quick note about offshoring…
If you do hire international freelancers, do some research as to any tax or legal documents you require from them. It will start with getting a W-8BEN from them (the equivalent of a W-9, but for international contractors).
2. What are the Issues Involved With Outsourcing?
Personally, I don’t think there are any issues involved with outsourcing.
For every outsourcing risk in this article, I provided at least one way to prevent it from happening.
If you happen to encounter an issue I didn’t cover, please let me know in the comments below and I’ll be happy to guide you through it.
One issue that I didn’t discuss is that if you hire an international freelancer, they may not accept the traditional payment processing sites such as PayPal. So, you’ll have to adjust slightly to that.
Once you begin outsourcing, you’ll probably realize issues internally that can help you improve your processes.
So, outsourcing is actually beneficial if you think of it in that respect.
3. Why is Outsourcing Bad?
Outsourcing isn’t bad.
Let me state that again for the people in the back…
Outsourcing isn’t bad.
Yes, there are outsourcing risks, but you know how to fix them now.
It’s kind of like what I say to someone who tells me they don’t like red wine.
It’s not that red wine is bad, but it’s that you just haven’t tried the right one (if this is you, I recommend Beaujolais from Burgundy).
The right outsourcing experience can be MAGICAL.
4. How Can the Risks of Outsourcing be Reduced?
I discussed this in each and every outsourcing risk I listed.
So, take some time to reread those sections.
But, to briefly summarize, heed this:
- Do your due diligence when hiring and vetting freelancers
- Have a signed contract before any work is done
- Maintain clear and consistent communication
- Standardize, document, and streamline your processes
- Be professional
Of course, the risks of outsourcing could be fully reduced if you don’t outsource. But, I don’t recommend that.
5. Is Outsourcing Good or Bad?
This is ultimately determined by your experiences and it’s very subjective.
As someone who’s outsourced successfully, I have great things to say about outsourcing.
I’ve even had positive outsourcing experiences on Fiverr and some people don’t even go near that platform.
Freelancers without initiative could make outsourcing bad, but if you hire the right ones, then you have nothing to worry about.
Some of my coaching clients have had negative experiences, but I helped guide them on the right path and they’ve all reported a positive experience afterward.
6. What are the Advantages of Outsourcing?
What a fun question!
This is something I plan on writing a whole other post on because there are so many, but here are a few right off the top of my head:
- Outsourcing is cost-efficient: if you’re not good at something, passing it off on someone else saves you a lot of time. And, time is money.
- Outsourcing lets you focus on high ROI tasks: when you’re not spending time on the admin and other tasks not crucial to the core of your business, you can actually plot your business’ future. Spend time making money!
- Outsourcing lets you build a team: Going at online business alone isn’t the most supportive of environments. With a team, you get amazing cheerleaders and people to pass off tasks to who enjoy doing them.
If you’re looking for more reasons why you should outsource, just imagine what it would be like if you had someone who could just take tasks off your plate in your personal life.
Wouldn’t you be on board with that?
7. Is Outsourcing a Good Idea?
Yes, outsourcing is a good idea. In fact, it’s a great idea!
But, it’s only good if you set yourself up for success.
If your business is starting to grow and you’re pressed for time, regain some of it by outsourcing.
You should never be outsourcing for convenience. That’s a surefire way to lose a lot of money. You need to be strategic with your outsourcing.
Outsourcing is not a solution for procrastination.
So, yes, outsourcing is a good idea if done for the right reasons. And, as a freelancing and business expert quoted in many top publications, that’s my expert opinion and I’m willing to stake my reputation on that.
8. Does Outsourcing Save Money?
Let’s think of a quick scenario…
You’re not great at the tech side of things with your blog. Most people aren’t. Trust me, you are NOT alone. So, when you spend hours upon hours trying to hard code your affiliate disclaimer in and still aren’t successful, you’ve wasted all that time.
Instead, you could’ve outsourced that to someone who’s highly competent and qualified and you could’ve done something that makes you money.
For example:
- Writing a blog post with affiliate links
- Promoting on Pinterest to increase pageviews and qualify for an ad network
- Reaching out for sponsored post campaigns
When we talk about saving money, we’re always talking about an opportunity cost.
That’s the concept of “If I do this, what do I miss out on?”.
If you think to yourself…
“A lot.”
Then, you will save a lot of money by outsourcing.
9. What is a Negative Effect of Outsourcing?
I think for most people (myself included), the negative effect of outsourcing that sticks out the most is the lack of control you get.
Outsourcing isn’t hands-on like most other things bloggers and online entrepreneurs do.
But, outsourcing can actually provide a lot of operational control if you’re able to standardize the process.
So, while you have to relinquish the power and control personally, your business benefits as a whole. It also means that it can run without you, which allows you more free time in your personal life.
10. What are the Ethical Concerns Involved in Outsourcing?
Don’t you just love questions like this?
I do.
I really should’ve asked my brother this question as he majored in ethics at Rutgers University, but to me, there are three major ethical concerns involved in outsourcing:
- The freelancer isn’t compensated fairly and equitably (this can happen if the freelancer is international and the standard of living is different)
- The contract is not created with both parties in mind
- Hiring internationally, while potentially cheaper, takes away jobs from citizens in your own country
These are only ethical issues if you really are sensitive to the topics.
But, these are my guiding principles when outsourcing, which tend to override those ethical issues:
- Pay the freelancer what THEY want, not what you think they want or are worth
- Agree on a contract that benefits both parties and facilitate a long-term working relationship
- Hire the best freelancer for the position, regardless of where they live
If you’ve got an ethical issue I didn’t think of, please let me know in the comments below.
And, when my brother reads this article and skips to the bottom because it’s on the lengthier side, he might suggest something, too.
11. What are Some Examples of Outsourcing?
You can outsource a lot! More than you’d think, really.
Here are some examples:
- Freelance writing
- Copyediting
- Copywriting
- WordPress maintenance
- Proofreading
- Customer service
- HR and payroll
- Bookkeeping
There are plenty more services that freelancers may pitch you about in your business email. It’s up to you to decide if you want to hire them or not.
If you’re looking for an outsourcing success story, when I was hired to be a team member of Create and Go, it enabled my clients to go travel across the country and globe and live the life they wanted.
At the time, it was just customer service, but now, my position has escalated into online business management.
And, because I love them, I’ll be staying with them for some time to come.
Conclusion
I hope you feel A LOT more confident about outsourcing now.
I know that the outsourcing risks are abundant, but you’re armed with the info you need to make outsourcing work for you.
In this article, we went over these 11 outsourcing risks:
- Intellectual property and copyright violations
- The budget goes overboard (hidden costs)
- The deadlines aren’t met
- The freelancer isn’t qualified
- Getting sued
- Your future reputation
- Lack of control over the process
- Geographical and timezone differences
- Language barriers
- Unknown subcontracting
- Apathy
We also went over 11 (coincidentally) frequently asked questions about outsourcing.
The Cliff Notes version is that you should outsource strategically when you’re ready and make sure your business is set up to do so with the right systems and budget.
Do you have any questions left on outsourcing?
Let me know in the comments below!
If you’ve had a negative or positive experience with outsourcing, I want to hear about that, as well!
Cheers to future success!
