The Pros and Cons of Contractors

I recently read an article by a successful entrepreneur about the attitude of some businesses towards hiring contractors to help with certain aspects of their business.  The article focussed on the DIY nature of business in New Zealand, and the positive contribution that a skilled contractor can bring to the party. 

For example, rather than slogging away for hours and hours (and I am guilty of this myself) trying to create a website, you could pay a web-designer. 

Instead of fumbling your way through tax forms and receipts, you could get an accountant to do all that stuff for you.

Rather than trying to make your logo or doing all the printable design work yourself, you could just pay someone to sort that out for you.

Of course, deciding to take on a skilled someone to help you with your business is a big decisions.  Will they understand your business?  Will they care as much as you do about your business?  Are you picking the right person?

Whether it is for one-off help or for on-going support, there will always be pros and cons.

The Pros

• Skill Matching - you get someone with the skills that match exactly what you need. A contractor comes on board and needs very little hand-holding because they are using their core skills with their core applications
• Removing your pain - there is always going to be aspects of your business that are a real pain or you just don't have time to do well.  That's where the real value is in hiring someone else to do that stuff.  
• Flexibility - you don't have to add permanent headcount for the role you need filled.  You just use that service as you need. If you need to cease a contract due to economic reasons, it is easier than letting permanent staff go.
• Training - A skilled person can be paid not only to help with specific tasks, but also to help provide on-the-job training for you or your staff.

The Cons

• Budget - Although you save the costs of having to provide sick leave, annual leave and other employee benefits, on a per-hour basis, contractors are a bit more pricey.
• No Skin in the game - this could be said of any employee really these days as we don't sit in a job for life anymore.  However, it is easier for contractors to leave mid-contract or not extend past the contract end date.  When that happens, if you haven't opted for in-house training then you could lose core skills.
• Continuity - bringing in new contractors all the time can confuse things and cause a few continuity issues for you and your business.  Where possible, it's best to go back to the same company or contractor so that you minimise the risk of confusion.

Ultimately taking on a contractor is a very personal decision for any business owner.  Setting up a contract with another company or consultant who will provide a service to you, can be a leap of faith.  Shop around and make sure that the service you want is being offered and that you are happy with the terms.  As long as both parties have a passion for what they are doing together and the right skills are applied and transferred as well, this type of relationship can be a success. 

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