Outsourcing: Making the Shift to Freelancers
A small business creative service agency based in Raleigh, N.
C.
named The Marketing Machine grew from a one man show to a micro firm composed of 11 staffers.
Four were contractors, seven were full time employees, and then there were four business partners.
But even with such significant growth in both their client base and staff size.
The Marketing Machine, although passing $1 million in annual revenue, barely made a 2% growth in actual profit by late 2011.
The Marketing Machine's sole founder and chief executive officer, Paul Spinak, says that "It didn't take long to realize that there were a couple different visions going on.
" In other words, the company needed to make a major change if it wanted to survive.
The Solution In early 2012 Spinak had an idea that could potentially increase the company's financial dilemma.
The solution? Downsize The Marketing Machine to a core staff of four employees who would be tasked with overseeing the entire company's structure, and then rely on a group of independent contractors to fulfill other business roles that were not needed as often.
Most of these tasks were assigned to contractors who specialized in graphic design, web design, who were account executives, videographers and copywriters.
Spinak figured that this would improve finances because the contractors would only be paid when they were actually needed.
Doing this gave the company the ability scale up and down as needed.
All in all, Spinak's change in business module worked.
Today, The Marketing Machine utilizes a small network of about 8 freelancer contractors, three of which work an average of 25 to 35 hours per week while the remaining five work less than 10 hours a per week on average.
With this successful change Spinak has realized that "The world has opened up to the idea that if you can put a good team together, it doesn't really matter whether they're on staff or where they work.
" Along with saving time and money on seeking out employees, the company was also able to downsize and save money on office space by moving from a 2,500 square foot suite to a 1,350 square foot art-deco building.
Since this shift in thinking, The Marketing Machine has seen an 11% rise in profit so far.
The company determined it was also able to save between 5% and 7% on labor costs.
The Key The fundamental key that turned this business from barely surviving to thriving was lying in one simple yet extremely efficient switch: rely on and use more freelance employees.
Making this revolutionary transition reduces overhead costs and gives a business more agility, flexibility and allows a company to put more focus on decisions that affects the core structure of the brand.
C.
named The Marketing Machine grew from a one man show to a micro firm composed of 11 staffers.
Four were contractors, seven were full time employees, and then there were four business partners.
But even with such significant growth in both their client base and staff size.
The Marketing Machine, although passing $1 million in annual revenue, barely made a 2% growth in actual profit by late 2011.
The Marketing Machine's sole founder and chief executive officer, Paul Spinak, says that "It didn't take long to realize that there were a couple different visions going on.
" In other words, the company needed to make a major change if it wanted to survive.
The Solution In early 2012 Spinak had an idea that could potentially increase the company's financial dilemma.
The solution? Downsize The Marketing Machine to a core staff of four employees who would be tasked with overseeing the entire company's structure, and then rely on a group of independent contractors to fulfill other business roles that were not needed as often.
Most of these tasks were assigned to contractors who specialized in graphic design, web design, who were account executives, videographers and copywriters.
Spinak figured that this would improve finances because the contractors would only be paid when they were actually needed.
Doing this gave the company the ability scale up and down as needed.
All in all, Spinak's change in business module worked.
Today, The Marketing Machine utilizes a small network of about 8 freelancer contractors, three of which work an average of 25 to 35 hours per week while the remaining five work less than 10 hours a per week on average.
With this successful change Spinak has realized that "The world has opened up to the idea that if you can put a good team together, it doesn't really matter whether they're on staff or where they work.
" Along with saving time and money on seeking out employees, the company was also able to downsize and save money on office space by moving from a 2,500 square foot suite to a 1,350 square foot art-deco building.
Since this shift in thinking, The Marketing Machine has seen an 11% rise in profit so far.
The company determined it was also able to save between 5% and 7% on labor costs.
The Key The fundamental key that turned this business from barely surviving to thriving was lying in one simple yet extremely efficient switch: rely on and use more freelance employees.
Making this revolutionary transition reduces overhead costs and gives a business more agility, flexibility and allows a company to put more focus on decisions that affects the core structure of the brand.
