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5 Ways Subcontractors Boost Your IT Business

5 Ways Subcontractors Boost Your IT Business

Monday, May 9, 2016/Categories: independent-contractors

As your IT business grows and develops, you don’t necessarily need to turn to employees to keep you afloat. Sometimes, it's cheaper and more efficient to hire subcontractors when you need extra help.

In fact, payroll services company SurePayroll found in 2013 that one in five small-business owners actually prefer subcontractors to regular employees. It makes sense when you consider that IT subcontractors can benefit your business in these five ways. 

1. Subcontractors Cost Less

Fulltime employees are expensive. TechRepublic estimates that employee benefits run as much as 20 to 50 percent of salary. That means an employee making $70,000 in salary could really cost you $84,000 to $105,000 when you factor in benefits, taxes, and things like Workers’ Compensation Insurance.

Subcontractors, on the other hand, take care of their own benefits. When you factor in those cost savings, a contractor charging $80k is actually less expensive for your business than an employee making $70k.

2. Subcontractors Save Time

Entrepreneurs have a tendency to do everything on their own, but that kind of working only gets you so far. At some point, your business is going to take on work you can’t do yourself, and that’s where subcontractors can help. 

Generally, subcontractors work best for short-term, project-based jobs. And because they work project to project, they have a strong incentive to finish a job quickly so they can move on to the next one and make more money.

There's also the added benefit of being able to hire people to work during your off hours. James Johnson, managing partner at (@BestSkiPackages), an ecommerce site that sells ski travel packages, points out that "working with people in different time zones can be great. We can send off work in the afternoon and have it finished when we wake up the next day. Research projects are fantastic for outsourcing.”

3. Subcontractors Give Your Business Flexibility

As a small-business owner, you know that your workload can change suddenly. If a client walks in and wants you to head a project that requires a lot more resources than you currently have, who are you going to call? Ghostbusters – sorry – subcontractors!

By hiring additional developers as subcontractors, you can handle the extra workload. You can scale your staff up or down depending on project capacity – the definition of flexibility.

Johnson has found this especially helpful as a small-business owner. "A small business doesn't need a fulltime social media manager, but having one for 10 hours a week can make a huge difference and really frees us up to manage the more important tasks," he says.

4. Subcontractors Can Supplement Your Expertise

You can't do it all yourself, even if you are a mad genius. There just aren't enough hours in the day. So corner the tasks you enjoy doing, and let a contractor help with tasks like accounting or business planning.

In some situations, you might want their IT expertise. Bringing in statisticians, UX experts, or security consultants can improve the product you deliver to clients and open new doors for revenue.

You might even go to subcontractors for their "soft" skills and marketing acumen. Mitch Goldstone, CEO of (@ScanMyPhotos), explains that "most tech companies are, well, techie."

Goldstone’s team was great at coding and setting up an ecommerce website – which has digitized over 300 million photos – but they weren't exactly great at writing product descriptions, blog posts, and catchy marketing materials. For that, they turned to contractors.

Whether you’re looking to fill in knowledge gaps or pawn off a task you’d rather not do, subcontractors can help!

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