Stabilise a Business

How to Hire a Freelancer

August 11, 2023 / 180 Comments

Your business is making money, and you’re ready to hire help so you can scale that profit. Now comes the age-old decision. Do I hire an employee, or do I hire a freelancer? We are not experts in hiring employees, but we can tell you the differences between freelancers and employees so you can make your choice. This article will cover the benefits of hiring a freelancer and how to hire a freelancer for your small business.

Why Hire a Freelancer

Small businesses hire freelancers because it allows them to grow without overextending. You can hire a freelancer on an as-needed basis where you are only committing to the project or the contract. You don’t need to worry about generating the income needed to pay the freelancer long-term; you only need to have the money to pay the freelancer for the project.

Hiring freelancers on a project-by-project basis also means that you can afford greater expertise or results because you are not having to pay the annual salary. You are essentially splitting that cost with other business owners that the freelancer works with. You can hire an expert who can take the project off your hands and get better results than you can rather than hiring someone less experienced that you need to handhold.

Freelancers are extremely motivated because their success relies on your success. Each project they work on markets their business – either through referrals or because the freelancer uses the results to land more clients. You can trust them to work independently and be proactive in the working relationship. They care about you achieving great results, so they are happy to explain to you how various choices will affect the results you get. As long as you are forthcoming with information, freelancers can be a tremendous asset to your business.

What Is the Difference Between Hiring Freelancers or Employees

Before hiring a freelancer, it is helpful to understand how freelancing works and what to expect. From a freelancer’s perspective, it can cause serious friction in the working relationship when a client treats you like an employee. When you hire a freelancer, you are hiring a fellow business owner – an equal – whose expertise you value. That means that the working relationship and hiring process looks very different.

  • Streamlined Hiring Process – Time is money quite literally to freelancers. In addition to the work they do with clients, freelancers have non-billable hours that they spend managing their business and finding new work. The good freelancers do not have the time nor the patience to prepare cover letters and sit through multiple rounds of interviews on the promise of work. Just like if you were choosing a utility company, the burden is on you, the business owner, to know what you want and to determine if the freelancer is a good fit. We talk more about how to hire a freelancer below. 
  • Set Scope – The quote you were given and the money you are paying is based on the scope you agreed to. Anything outside of that scope needs to be discussed with the freelancer and may incur extra costs. This includes extensions to the timeline of the project.
  • Contracted Agreement – The freelancer is often the one who sets the contract in the working relationship. Just like if you were buying from Apple, they set the terms of the agreement, not you. As with any contract, you can negotiate and discuss expectations before signing. It is helpful to initiate conversations about payment and method of work as soon as possible.
  • Reduced Availability – One of the biggest points of friction in a freelancing relationship is a client who expects a freelancer to drop everything for them. Freelancers work on multiple projects at once and chose to freelance because they wanted control over their schedule. Let freelancers know in advance if you need them available for certain dates, use preferred communication methods, and don’t expect instant replies. Most of all, don’t book meetings for things that can be said in an email.  
  • Increased Cost – Freelancers cost more per project than it would cost to hire an employee. However, they cost less in the long-term because you only hire them on an as-needed basis and don’t need to pay benefits or taxes. Freelancers set their own prices.
When hiring a freelancer, remember that they are fellow business owners rather than employees.

How to Hire a Freelancer for Your Small Business

The hiring process has a larger impact on the success of your project than you may expect. How you hire a freelancer will determine the quality of the freelancers you work with and their ability to produce results.

We can walk you through the steps of how to hire a freelancer for your small business, but please know that there may be some variations to this process depending on your business, the discipline you are hiring, and the freelancers you choose.

Create a Brief for the Project

Before you start looking at freelancers, you need to be clear about your goals for the project and how it fits into your overall business. Write down the following things:

  • What are the results you want to achieve?
  • How do those results fit into your overall growth plan for your business?
  • What does your ideal finished product look like? How does it work, and how do your clients interact with it?
  • What are your goals for this project in order of priority?
  • How does this freelancer fit into the overall project? (Will they be working alongside a creative team? Will they be doing their part, and then you’ll hire another freelancer for another part?)
  • What is your budget?
  • What impact will time zone have on your experience? (Do you want regular meetings? Can you communicate effectively so communication will not delay the project?)

These are the things you need to know before you can start looking for a shortlist of freelancers. When you create a brief for freelancers, you need to include more information so that you and the freelancer are on the same page when you start work on the project.

Find Freelancers That Suit Your Needs

The next step is to find some freelancers. There are three ways you can do this. You can post a job listing online and let freelancers come to you, you can browse freelance marketplaces, or you can actively search for freelancers.

Consider the suitability of each freelancer by doing the following things:

  • Look at their portfolio – You are looking to see if they have worked with businesses like yours in the past and can produce the style and quality you are looking for. If you do not see elements that you are looking for in their portfolio, then they are likely not a good match.
  • Look at their prices – There may be multiple variables in a project, but most freelancers will provide guide pricing based on standard inclusions. Does the guide pricing match your budget expectations? If a freelancer’s pricing is out of your budget range, it may be best to look for another freelancer or wait until your budget allows you to hire the freelancer.
  • Look at their results – Most freelancers will include information on their service pages about past projects and what results they have helped their clients to achieve. Ideally, you want to hire a freelancer that has helped a similar business achieve the results that you want to achieve.

Based on those 3 factors, you can create a shortlist of freelancers you want to interview. We recommend interviewing 5 or fewer freelancers. If you interview too many freelancers, it can be difficult to keep the details straight. You risk becoming overwhelmed or experiencing analysis paralysis.

Book Discovery Calls or Interviews

Most freelancers offer free calls with prospective clients to determine if you are a good match to work together. Depending on the freelancer, they might call it a discovery call, an interview, or a free consultation. The freelancer will likely qualify you before they offer the call to see if you are someone they want to work with.

Be upfront about your timeline during this qualification process. Freelancers have different approaches to their schedules. Some may be booked out 6 months to a year in advance. Some may prefer to only take calls for projects starting in the next few months. Telling the freelancer your anticipated start date allows them to tell you if they are booked up at that time or give you a quote and how far in advance they hold discovery calls.

Discovery calls tend to be 30 mins or shorter. The freelancer will usually guide the call by telling you a little bit about their process, showing you some past work in similar fields to you, and asking you some questions. They will also give you time to ask questions. Due to the short time limit, come prepared with questions.

Creating a spreadsheet that allows you to compare the suitability of the shortlisted freelancers could help. Do your research prior to the call and fill out the information you find so that you use the discovery call wisely.

Each freelancer approaches discovery calls differently. Some may give advice freely or create a basic strategy during the discovery call. Some may charge for calls where you want to go into specific details and get advice. (Unfortunately, there are some unethical business owners who will use these free calls to get strategy from high-quality freelancers and then hire cheap freelancers to do the work.)

Some freelancers may quote pricing during the discovery call, or some may send an email with a proposal following the discovery call.

Payment Terms and Prices

Before you commit to hiring a freelancer, make sure you are clear about the scope and how payment will be handled. There is often a little bit of flexibility in a freelancer’s payment terms and pricing as long as you negotiate respectfully and are transparent. Remember that a freelancer is a fellow business owner who has set the prices and payment terms that work best for them, and you are asking for a massive favour when negotiating.

Freelancers set their own prices and payment terms.

Here are some dos and don’ts of negotiating payment terms and prices with freelancers.

Do:

  • Calculate the percentage discount you are asking for and consider how you would feel if someone asked you for that discount.
  • Keep in mind that service providers are limited by their time, so bulk pricing discounts or recurring work discounts will be modest.
  • Understand that freelancers are just as wary of being scammed as you are. There are a lot of unethical people out there who pay freelancers late or not at all. Keep in mind the risk you are asking a freelancer to assume when you are negotiating.  
  • Be transparent about what kind of payment you can commit to. Not paying your freelancer or not paying them on time will sour your working relationship. It can also open you up to legal action.
  • Consider reducing the scope of the project if your budget is an issue. Tell the freelancer what your budget is and ask their advice on how you can use that budget to maximise ROI. Most freelancers will be happy to advise you on what to tackle first and what can wait until your budget allows.
  • Recognise that promises of referrals or “exposure” will not fly in negotiations. If you have a large network, ask your freelancer if they offer discounts or payments for successful referrals. (These are paid after the fact, not in anticipation of referrals.)

Don’t:

  • Shame a freelancer for being too expensive. Just like you set your business prices, the freelancer has the right to set whatever prices they feel are appropriate. If your budget is too low in comparison to the freelancer’s prices, you need to find another freelancer whose pricing matches your budget.
  • Be rude or pressure a freelancer into lowering their prices. Do you really think someone is going to be motivated if they feel like they are not being paid enough?
  • Hire a freelancer who is out of your budget and not pay them or drag your feet paying them. This is not a large company that has the resources to weather late payments. This is an individual who will not have the money to pay rent.
  • Be afraid to ask for payment plans or smaller packages. Freelancers are happy to work with you to find a mutually beneficial arrangement as long as you are polite and transparent.
  • Try to negotiate after the contract has been signed, and the strategy call is booked. The time and place for negotiations is over.

Understand the Agreement Terms

Read the contract or the agreement carefully and query anything you don’t understand. Freelancers set contracts that clearly define the scope of the agreement and the expectations of both parties. It will also likely list the penalties for failing to fulfil your expectations. For example, a late or missed payment may cause work to cease or incur penalty fees. Some freelancers may pause the contract in the event of no response from you for a certain period of time.

The time to query or negotiate the agreement or contract is now, before you sign the contract and before you pay the deposit.

Communicate With Your Shortlisted Freelancers

Make sure you communicate well with your shortlisted freelancers. Give them a timeframe on when you expect to make a decision, and let the freelancers know if you have chosen someone else. Even though freelancers don’t hold space until they hear definitively from clients, it is still poor practice to ghost them. You never know when you might need them in the future.

Telling freelancers that you have decided to work with someone else or your plans have changed does not have to be scary. It is very unlikely that freelancers will be upset by it – they’re likely to be glad that you let them know. Here’s an example message.

Hi,

Thank you for all your help so far. I really appreciate your time and think your work is of such great quality.

Something has come up and the project is not going ahead./Someone was a slightly better fit.

I’ll keep you in mind if things change in the future and I wish you all the best.

Thank you,

Swap the bold line out for which option fits best.

Remember, you will likely need more freelancers in the future, so it is in your best interest to maintain good relationships with high-quality freelancers by communicating well and being polite. Even if the freelancer you choose to hire is perfect and becomes your go-to, they might not be available in the future, or you may need to hire multiple freelancers for a large project. Do you think a freelancer will agree to another interview with someone who ghosted them previously?

 

 

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