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58 Ways To Find Money For Your Business is crammed with tips, information, and help for entrepreneurs and small business owners who need money for their company.
Outsourcing and Using Consultants
Many early-stage or smaller companies cannot afford to hire fulltime staff for every business function—finance, marketing, technology, production, etc. Or they may not be able to afford the very best individuals right now. What many times happens is that the entrepreneur ends up wearing more than one hat, in effect doing the jobs of two or three or more individuals. And in some cases there are gaps in the knowledge or experience of the management team. Perhaps they have a technical background but not much expertise in marketing for example. The fact is, in today's complex, international business world, it is very difficult for any management team to have all the answers to the difficult issues involved in running a business. Whether it's a matter of finances or a matter of experience, in either case these gaps can be addressed through outsourcing—using independent contractors or consultants to provide the needed expertise.
When you think of a consultant, what may come to mind is the image of a professional who charges a very high hourly fee, such as $200 or more. Actually, many consultants work for very reasonable compensation. For one thing, it has now become common for consultants to work out of their homes, reducing their overhead costs.
You might also be reluctant to use a consultant because you don't think you have a "project" for them. Perhaps you just need some questions answered about how to look for financing, for example. Consultants are usually happy to work on an hourly basis; if you only need an hour of their time, you only get charged for an hour.
The great thing about taking advantage of outsourcing today is that through the Internet you can find absolutely any kind of expertise you need. Most consultants have Web sites that showcase their capabilities and accomplishments. An entrepreneur should have no trouble finding any number of qualified individuals to choose from. They usually can provide references—former clients—for you to check and help you decide whom to hire. If you intend to work with the consultant on an ongoing basis, make sure your personalities are a good fit. For the duration of the project, the consultant is in effect a member of your inner circle; it's important that you get along well and build a relationship of trust.
Other things to remember when outsourcing are:
1) Spell out what both you and the consultant are expected to do, and when each part of the project is to be finished. If the consultant needs certain information from you in order to complete the project on time, make sure you are capable of providing the information when the consultant needs it.
2) If the consultant will have access to sensitive or proprietary information about your company, it is customary to have them sign a non-disclosure agreement.
3) It may be tempting to choose the least expensive consultant you can find, but that may not be the best solution for your company in the long run. Large variances in quoted fees may mean large differences in the quality of the work performed. Look for reasonable consultants, not "cheap" ones.
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