Out vs In-House: Weighing the Pros and Cons

 

You’re looking to scale your online business quickly and effectively. You want to take a load off of your plate, so you can focus on growing the business and not on the day-to-day operations. You want to move from a manager to an owner.

 


Scaling starts with the expansion of your team. Thanks to robust advancements in the hiring process, remote work, and scheduling processes, it’s easier than ever to get more people onboard for various roles in your operations.

 


But how do you know what kind of team you want to grow?


Up until this point, your business may have just been you and your kids packing boxes in the garage. As you look to scale, you wonder what kind of employee will work for you. Many e-commerce companies function remotely, while others have physical space. Some have a lot of employees on the payroll, while others contract work out.

 


So what does “employee growth” actually look like for your business? Should you hire people in-house on your team, or should you consider outsourcing to freelancers?

 


Below we’ll bring you through the process to determine if freelancers or in-house workers are best for your e-commerce business. Keep in mind that you might end up with a mixture of both, depending on your needs.

 


People in a meeting room

 

What Roles Do You Need to Fill?


Who do you need to bring on your team in order to grow? Which roles are necessary to take your e-commerce store to the next level? Knowing who to bring on your team will help you determine whether their role is more effective in-house or freelance.

 


Some roles you might need to open and fill include:


  • Web Developer

  • HR Manager

  • Operations Manager

  • Marketing Manager

  • Store Manager

  • Customer Service Manager

  • Legal Representative

  • Accountant/Finance Manager


 

Once you have a list of necessary job openings, consider how they will ideally function within your company. Will you need a web developer just to create your initial website or to manage all of your web needs moving forward? If it’s a short project, a freelancer might be enough. If you need a web developer to handle ongoing site crashes and improve coding, you might want to consider bringing someone in-house.

 


Hiring Slow for Exponential Growth


Start with one or two people per “department.” If you want to grow, you can create a management position that will hold the responsibility of hiring their team as needed.

 


You want to keep your team lean. The leaner the business, the lower your overhead and the easier it is to manage. You want to avoid the common mistake so many small businesses and startups make: don’t let growth cannibalize your business. Fast growth is a good sign, but it can also become unsustainable in a short amount of time

 


For example, you go from zero to 50 employees in one month. But the new employees are still getting acclimated and trained, so there isn’t much impact on revenue yet. You suddenly have 50 new salaries to pay—with the same amount of sales you’ve had in months past. This could easily run your company into the ground in a few months, if not a few weeks.   

 


When it comes to growth, slow and steady always wins the race. This helps you maintain control while meeting an increase in overhead, and building a strong culture from the ground up.

 


Pro-tip: Create a hiring schedule. Start with the most important roles for growth, like a marketing or operations manager. Then, consider how this will impact your numbers. Build a rough timeline for hiring that will allow you to get everyone on your team in a timely manner without stretching or drying out your resources.

 

"Make sure you have the resources to build the appropriate infrastructure for  your ideal team."  -Click to Tweet-


 

Will You Outsource Departments?


It’s becoming more common for online retailers to outsource entire departments and processes. The B2B (business to business) e-commerce sphere was already huge and grew even more as a trend in 2018. This means it’s easier than ever to find software and online services to control your business processes for you.

 


For example, some online retailers will outsource their operations to third-party logistics businesses. This hands over the process to an expert team who can do it efficiently and effectively, saving you time, money, and energy.


 

You may also want to outsource your marketing processes. It’s not uncommon for small businesses to lack the experience needed to market their business effectively. If you’re ready to grow, it’s time to consider outsourcing your marketing optimization to Seller’s Choice. Our team members are proven, hands-on experts at building brands and advancing digital reach.

 


Is outsourcing right for you? Read What To Outsource And What To Keep In-House to make the decision.

 


Do You Have the Capital to Provide Benefits?


Most in-house employees expect a benefits package. This can include healthcare, workers’ compensation, and even a 401(k). If you’re bringing workers on in-house, especially full-time, you will need to offer a comprehensive benefits plan. This is both required legally, and your offerings can help in attracting the top talent.

 


Freelancers typically don’t receive benefits, though. But that doesn’t mean they don’t get benefits from you, but their benefits aren’t necessarily paid. You can provide benefits like the flexibility to choose their own hours, to work for bonuses or extra pay, and even to travel for your business if applicable.


 

Some companies do offer paid benefits to freelancers to create a more attractive package. This is something you can consider if you aren’t attracting the types of contractors you’re looking for, but you still want to keep top talent on a freelance basis.

 


Man sitting with a laptop

 

Is the Infrastructure in Place?


Whether in-house or freelance, you’ll need to consider how your employees will interact and work together. Do you have a physical office space for your in-house employees? If you have a remote team, which software and platforms are you going to use to centralize communications?

 


You want to set up the appropriate infrastructure to manage those employees. For example, if your entire team will be remote, you might want to consider freelancers who already know how to work independently. If your in-house team will be in an office, you will need to create a physical working space that takes overhead into account.

 


The team you have will determine the infrastructure you need and vice versa. Make sure you have the resources to build the appropriate infrastructure for your ideal team.

 


Which is Right?


There’s no right or wrong answer when deciding between freelancers and in-house employees. Below is our list of pros and cons for each, but it can also depend on how you run your business individually:


 

Pros

Cons

Freelancers

Save 20-30% on compensation

Multi-tasking; you likely won’t be their only client

 

Don’t pay for benefits

Hard to build a brand culture

 

Remote work, so less office overhead

Hiring challenges; need to weed through a lot of freelancers to find the right one

 

Lower risk for termination

Training and supervision is strained

 

Easy to find the best experts in a given field

 
 

No limits for global talent

 
 

High quality work, because they want to maintain their client relationships

 
     

In-House Employees

Easier to build an employee culture

Higher compensation

 

Consistency on team

Paying for benefits

 

Investment; employees have a greater stake in the success of the business

Need strong infrastructure

 

A wider range of tasks and availability

More lengthy process for termination or job reduction, regardless of business needs


 

Whether you hire a freelancer or in-house employee, there’s never been a better time to grow your team and scale up. With 2019 finally here, e-commerce is exploding, technology is advancing quickly, and your business is perfectly poised for profits.

 


Consult with Seller’s Choice to get your team on the right track for marketing success this year.  

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