How To Start a Subcontractor Business?

After hustling day in and day out and burning the midnight oil, you have successfully established a name for yourself. Projects keep pouring in from all across the globe & you are riding high on success. Kudos! Nonetheless, on the flip side, excessive work offers are turning out to be a major problem.

Certainly not a great feeling when you are caught between two contradictory situations. Taking up all the offers, all at once, can take a serious toll on your sleep cycle. On the other hand, turning down lucrative offers just because you are preoccupied doesn’t seem fair. Isn’t it?

Well, every problem has a solution. In today’s era, Freelancing has grown popular than ever. Why not help your fellow Freelancers and leverage the time by Subcontracting a few of them? However, there are few things you should be aware of before you jump on the bandwagon.

How to start a subcontractor business? How does subcontract work out?

Subcontractor business can be started if the entrepreneurs identify the purpose of subcontracting, build a network, maintain a budget, and maintain relationships with subcontractors. Entrepreneurs who start the subcontractor business need to understand technology, business steps and prepare excellent contracts and agreements.

Here is a compilation of 5 simple rules to become a Subcontract Professional. Make them your holy grail, and you never have to turn down a job offer again!

 

 

1. Identify Your Purpose of Subcontracting:

You are aware of the USP of your service and the nuts and bolts of your operation. Over time, you have built up a personal brand and goodwill in the market based on these aspects.

Nonetheless, have you considered the option to look for Freelancers who possess numerous other skill sets and contribute to your service?

If you haven’t already, go ahead and opt for it. Wondering how? Keep Reading!

Firstly, segregate a project and create an outline.

Secondly, jot down the portions which could be definitively assigned to others, according to the skill sets.

Be it your willingness to establish a network to cover in case of emergency or building a team; Subcontracting can do wonders and churn out mind-boggling results.

 

 

2.Build A Power-Packed Network:

 

Networking is an integral part of your Freelancing Career. If you have a power-packed network, it will make it easy to onboard members in your teammate.

It would help if you always looked for a trust-worthy person who can help you at the eleventh hour.

If you are collaborating with a Freelancer, it is always advisable to start with small gigs & scale up gradually. Do not commit the mistake of handover an important project to a stranger, having no acquaintance.

Always remember, trust cannot be built overnight. It is earned when words match the actions.

The ideal situation is to end up with a clan of reliable Freelancers with impeccable professionalism like good work ethics, optimistic attitude, and high skill sets.

 

 

3.Maintain A Cordial Relation With Your Subcontractors:

 

Freelancing allows you to be your own boss. However, once you start Subcontracting, you will be responsible for managing a group of other Freelancers. Always maintain a cordial relationship with them and do not make the blunder to throw unnecessary attitude.

Before kicking off a project, clearly define each involved party’s role, deliverables, deadline, payment schedule, confidentiality terms, and other essential pointers. Don’t leave anything to speculation.

After assigning the project, it’s fine to check in with the subcontractors but avoid being a micromanager. Give them enough space to do their work and always provide feedback.

One more thing, the client doesn’t need to know about the involvement of subcontractor(s). However, it is extremely crucial to hire professional and dependable Subcontractors because their work will reflect on you and your reputation.

 

 

4. Keep an Agreement in Place: 

 

 Before you hire a Subcontractor, it is paramount to have an Agreement in place. Don’t worry! Freelancers Union has a Contract Creator to get you started and save you time.

On the other hand, if you plan to Subcontract at a regular interval, it might be a good idea to hire a Lawyer.

In The Freelancer’s Bible, Sara Horowitz suggests the following key points which should be included in the Contract:

• Business Terms: Deliverables, Services, Deadline, Price Range, and Payment Schedule
• Legal Protections & Responsibilities
• Grounds and Terms for Termination
• Dispute Resolution
• Confidentiality / Non-Disclosure
• Non-Compete Clause

(If you need a Non-Compete Clause, you might consider hiring a lawyer to draft the agreement properly.)

• Subcontractor(s) cannot sign a direct Contract Note with your  Client.
• Intellectual Property
• Independent Contractor Status ( Define the Employer/Employee Relationship)

 

 

5.Maintain A Subcontracting Budget For Emergencies:

 

Always maintain a Subcontracting Budget to make sure everyone gets paid on time. Furthermore, keep aside a healthy cash reserve to schedule payments to your future Subcontractors without a hitch.

To create a budget, question yourself about the requirements.

-What tasks are you Subcontracting?

-For how long?

-What’s the market rate?

One of the prime purposes to begin Subcontracting is to take on more work, make more money, and grow your business. Therefore, the process will pay for itself in the end. Makes sense?

 

Freelancers, if you feel we have missed out on some important point about Subcontracting, feel free to add on!