How to choose between hiring in-house and outsourcing

How to choose between hiring in-house and outsourcing

Are you considering hiring a new employee? If so, the first thing you need to determine is whether you actually want an in-house full-time employee, part-time employee or contractor. In this post, we’ll show you how to make that decision and what steps to take once you have decided.

Why it’s important to choose the right one from the start

Why is the decision between an employee and an outsourced contractor or freelancer such an important one for your business? It’s simple.

  • If you choose an employee for a short-term project, you’re going to be stuck with someone that you either have to retrain for another position or someone that you eventually have to let go. Not to mention this will be after you have spent time training them, investing in their insurance and benefits, and the other aspects of hiring.
  • If you outsource a freelancer or contractor for an ongoing project that would be better handled by an employee, you may find yourself hopping from one outsourced worker to the next. While you don’t have to invest in insurance and benefits, you do have to invest time in finding new people, re-explaining the details of the project, helping them get to know your company, and much more.

So as you can see, the choice between an employee and a contractor is a big one. Here’s how you can decide. Woman with headset working on laptop

When you need to hire an employee

You should choose to hire an employee when the tasks you need the person to handle will be ongoing. For example, if you need someone to handle customer service calls, you would hire an employee because that is a task that needs to be handled on an ongoing basis by one or more employees, part-time or full-time. Or if you need someone to go out and sell your products, you would likely hire sales people as employees, as you would likely want to make sales on an ongoing basis.

In-house employees require a much bigger investment and commitment than outsourced contractors or freelancers. You have to adapt them to your company culture, give them benefits, and most likely see them on a day-to-day basis. That’s why you must be sure that they will be a necessity to your company before committing. Hands holding outsourcing caption sign

When you need to outsource

You should choose to hire contractors and freelancers when the tasks you need the person to handle will be temporary. For example, if you need your website redesigned, you would hire a freelance web designer because, chances are, you will only need the website redesigned once every couple of years. You may want to retain that freelancer for occasional support for a couple of hours every week or month if you need some updates, but otherwise, it wouldn’t be a part-time or full-time job.

Another example would be if you need the walls inside your office painted. You would hire a contractor to come and paint them because it would be something that you would only need maybe every couple of years, but probably less.

When you’re not sure, outsource first

If you’re not sure about whether to outsource a task or bring it in-house, start by outsourcing it. That allows you to test to see if it gets you the results you want.

For example, you might be considering hiring a graphic designer. So you start by hiring a freelance graphic designer to help you create great advertisements that you can use in a variety of online and offline publications.

If those ads generate a lot of business, you may want to either hire that freelancer or bring in a full-time graphic designer to create even more advertising materials. If the ads don’t generate a lot of business, you can just stop using the freelancer or cut back on the number of ads you create. Woman with glasses shaking hands with a man

Hiring tips for employees and outsourced workers

Whether you are hiring for someone to come work at your business long-term or work on a short-term project remotely, there are a few ways to make sure you get the best person possible for the job.

  • Interview your candidates. With employees, you’ll likely want to do it in person, whereas with contractors and freelancers, a video interview via Skype will do.
  • Check out their recommendations, reviews and testimonials if available on websites like LinkedIn and Yelp. Don’t just read them—see if you can contact a few of the people and confirm they actually worked with the person and had a good experience with them.
  • If the candidate has a blog, read what they have to say. Or look at the news they share to see if they are up to date on the latest news in your industry.
  • For employees especially, have them take a few assessment tests to get a feel for their judgment skills and personality. Athena Assessment (use code hiresmart) and also the really popular Myers-Briggs Type Indicator will help you assess your potential new employee and see if they are a good match for their role and your company.

These tips should help you find the best person for your project, whether it’s ongoing or just a one-off. And that will ensure that you get the best work done possible.


How will you choose your next employee?