How To Outsource Work: 6 Rules For Small Business Owners & Freelancers

Last Updated Jun 22, 2011 8:04 AM EDT

Last week I compiled a list of outsourcing services that can help freelancers and small business owners save both time and money. But how you choose (and use) these tools, from virtual assistants to transcribers, can make a great difference in your result.

Here are 6 ways to get more out of your outsourcing investment:

1. Set Clear Expectations Whether you're hiring someone to design your website or do your taxes, be upfront and clear about what you consider good work. Mary Tamargo, president of NOCUBE, a mobile healthcare applications company, says that outsourcing wasn't initially a slam dunk for her: "I outsourced the development of my app to an offshore firm in India using Elance.com. It was definitely an eye opening experience for me," says Tamargo of having her one-week project turn into four weeks because of delays and "the never-ending family emergency." Her advice is simple: "Include penalties if milestones are delivered late."

2. Don't Overlook Your Contacts If you can afford to use the best tool available for whatever service you need, go for it. But don't overlook trying to use your network for more affordable options. In 2009, when John White, owner of Best Essay Help, was building his business, budget was a priority. "I started looking for friends and friends of friends who would be willing to help me for a part-time or freelancer fee. I found a really talented accountant who was taking a break from the previous job and [wanted to earn] some extra cash," says White, who has since hired that accountant for a full-time position as his business grew.

3. Be Prudent About Paperwork Legal issues can cause a headache if you don't pay attention to things like tax forms. For instance: "You need to make sure, if you intend to hire a freelancer, 
that you are complying with federal and state laws. You will need to issue a 1099 if the 
person is paid over $600," says Meredith Keller of Smaller Box, a consulting firm for entrepreneurs. If you go through a large company like oDesk, though, most of this type of paperwork will be done for you.

4. Be Culturally Sensitive
Yes, you are paying someone to do work for you, but if you're dealing with cultural differences, trying to accommodate them can help your relationship be more efficient and pleasant. "In different countries, people have their own way of communicating, so it might take a little time to understand when a 'yes' means 'no' or the proper way to criticize work," says Rick Ramos, CEO of Team Launcher, a remote staffing agency with offices in India and the Philippines.

5. Pay A Fair Price It's natural to want to bargain hunt, but if you find a good vendor that you can afford, don't haggle too much: "Don't risk your client relationship over price -- cheaper is not always better," says Jillian Rowen, Sales and Marketing Coordinator at Apple Visual Graphics, a small, family-run printing company. You can negotiate but in the end, making someone feel like they're getting slighted may get you B-list work.

6. Test Them With A Small Task First Just like with any employee, you'll want to give your outsourced employees small projects first to see if they are competent and understand your mission. "If those are done satisfactorily, then outsource bigger, more important tasks," says Janet Attard, owner of Business Know How.
What are your outsourcing tips? Please add yours in the comments below.
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    Amy Levin-Epstein is a freelance writer who has been published in dozens of magazines (including Glamour, Self and Redbook), websites (including AOLHealth.com, Babble.com and Details.com) and newspapers (including The New York Post and the Boston Globe). To read more of her writing, visit AmyLevinEpstein.com.

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