Great article!
I’m from Argentina, have lived in New Zealand for 4 years.

In particular the “You’re exploiting them” affirmation is ridiculous. Many companies and freelancers in third world countries are making big bucks from outsourcing.

As you said, they also provide good quality work. The problem is many companies in the developed world outsource to the cheapest provider instead of taking the time to find the best cost/benefit alternative. They also ignore the risks.

Not everything can be outsourced. Outsourcing should be carefully analyzed:
- Do you really need to outsource?
- What are the risks?
- How much do you save?
- etc, etc, etc…

Awesome Post!

One thing I love about working as a freelancer online is the opportunity to work with other freelancers from all over the globe. It’s cool, fun, economical, and I get to brag about it a too friends and family. “Yeah, my logo designer in India, blah, blah, blah, and my programmer in Tennessee, blah, blah, blah, my html coder in the UK, blah, blah, blah…….Romania….Toronto……Australia……….etc., etc.”

But that said it is very difficult to find people you can rely on and can produce a level of quality you are satisfied with. They certainly do exist though. The major webmaster forums are full of them. Test people out on smaller projects first.

When I find a good one, and if they are in a place like India or Pakistan, and are charging way too little in relation to their quality I encourage them to start charging more. Or at the very least offer to pay a bit more than they charge. That way they are happy to take my projects and willing to go that little bit extra to ensure I’m happy.

The nay sayers, especially the ones worried about it cutting into their business, or “devaluing professionals in their own country”, can continue to bury their heads in the sand and let the new global market plow right over them. Because thats exactly what an unstoppable force will do to them.

Heck, I can easily find freelancers in the US and Canada that are greatly undervaluing their own services. There are many who are great, or at least decent, at what they do but are not so great on the marketing side, or in targeting the right niches, so they have to charge low rates to attract enough business. Or they are just new as a freelancer and hurting for work till they get more established.

Frankly, if I like their work and they are available when i need them, I really really don’t care where they are.

Oh, and if you can work it well, you can put the time zone differences to good use as well. Fire off an email at the end of your day to your sub-contractor on the other side of the globe and when you get to work the next morning your finished project is there waiting for you.

P.S. for those that don’t know. India is the worlds largest English Speaking Market Place. As a former British Colony a very large proportion of the population speak English, and many speak it well. You will be communicating mostly by web chat and email. Strong accents disappear in written form

Jamie, I’ve had all those problems too, but there are good ones that actually do communicate well. Harder to find but they are out there.

Globalization can hit you right on your face. The point of the post is now being consumed by this flaming war of opinions on the ” Ahs” and “oohs” of Outsourcing — whether anyone likes it or not, businesses care about profits and they will do anything for it. If it means firing you so that the job can haul itself to an India or China - so be it.

About Indians speaking English — a few of them have better vocabulary and speaking skills that most natives. There are authors like Salman Rushdie who earned International acclaim. I am a humble example of making full-time income from writing for clients from the US and UK. Well, if you go by rough statistics perhaps only 2% of the Indian population and 1 % of Chinese Population might be on par with the natives when it comes to communication skills — but can you guess what the size of that pool would be? It would wipe out an entire NZ and 3/4ths of the UK. Now wonder the jobs come here and the next time you need to talk to your bank, chances are that an India, Taiwanese, Chinese or someone else would answer that phone, while everyone else just frets and fumes about all the jobs lost.

When my design skills aren’t enough, I outsource to more qualified people. Sometimes they are designers I know personally and can speak face to face with, other times they can be half way around the world and use MSN/Skype to get the job done. Both can produce great results and leave me to spend time developing.

Hiring people who will work for less than Developed World Wages is tantamount to one country “Dumping” commodities into another country at sub-market prices. It is designed to undercut the business and workers of that country, and it is, in effect, an act of atomized International Aggression.

Consumers buy into it because their idea of a longterm mindset is making it to the checkout counter. Globalist Companies buy into it because they don’t give a damn about their own National or Cultural Standards of Living, only the Stockholders’ Bottom Line…and the CEO’s are the biggest Stock Holders! Workers in countries where people would be willing to work for those wages want to do it because, as always, their own country couldn’t provide them with a decent chance at a living, so, the West is their big Oyster Cracker…their Sugar Daddy. Things are so bad where you live that you can live like kings on $15/hr? Why is that? Why don’t you study Statecraft or Economics and fix your country rather than undercut the Western Working Class with your cheap services?

I love how the writer talks about “giving back” to Filipinos, and this is frequently the way I see it work. Everyone on the outside wants the West to be Open and to provide opportunities to the “Developing World.” Then, once their foot is in the door, it’s Tribal Loyalty Time!

I’ve ended up fixing many a PHP back end for clients who outsourced.. that’s just my experience. In terms of fairness? Hey its a free market, its competition, theres nothing you can do about it. When clients say, “What’s your price, I can outsource if you know what I mean.” F you then, I don’t take to threats like that kindly, go ahead and outsource, this is what makes me mad.

This article is a crock. I have been a freelancer for over 17 years and have personally worked with outsourced workers, in and out of the US, both as a Lead Developer and a Project Manager. First of all - you do get what you pay for. If you have to go back and have them re-do the work several times because they didn’t understand the requirements, or you have to spend three times as much time spelling out the requirements and explaining the requirements, then that $15 per hour is now costing you $50 per hour and about $200 per hour in frustration. And I have not even figured in long distance phone charges, travel cost, or any other costs associated with outsourcing - especially abroad. In addition, I have been hired to fix a lot of work that was previously outsourced. They could have hired me in the first place and saved them a lot of time and money. I personally don’t believe that companies realize what the ~true~ cost of outsourcing is - and what it is doing to our industry and our economy.

I have never heard of the exploitation excuse in the many years I have been doing this. I personally think this is something the author cooked up.

The only good point I see in the article is that freelancers should consider their pricing scheme - but NOT BY outsourcing the work. I have met many freelancers that think they deserve the same hourly rate that the big-5 consulting companies are charging. The big-5 can get it because they have the name and they have the support of their entire organization. I’m not saying that their consultants are any better. In my experience - many of them are worst! I have cleaned up a few of their messes. They just have the name of an organization so they can get the bigger dollars. Its like buying an HP computer versus a no-name brand. HP can get a lot more money because their name is on it - even though what is inside is not much difference, maybe even less than better than the no-name brand. But my bottom line point is that freelancers should take a long hard look at your rates. $30 per hour for 40 hours of work is a lot better than $80 per hour for zero hours of work.

Here are some realistic tips for you freelancers that have worked for me over the years:

1. First, charge a realistic rate. If you have been in the field for less than 10 years, don’t have a BS degree or higher, and don’t have industry certifications - you should take a long hard look at your rate.

2. Consider sub-contracting. There are a lot of these gigs out there. This can also get you some really good resume experience. And I don’t mean one or two gigs and then go out on your own. Try having 10 to 15 projects under your belt before going out on your own.

3. Be a generalist, with maybe one specialization.

4. Look at the job boards for what skills are needed in your area.

5. If you don’t have a degree, get one. Preferably at the masters level. If you don’t have industry certifications, get them. But be realistic here. I have seen consultants go out and get a whole laundry list of certifications and they still are not any better off. Just get the ones specific to your work. Having 10 different sets of initials after your name does not make you a better consultant or even more competitive. Certifications are only tie-breakers. Experience is the key! And if you don’t have at least 10 years experience, get a job and get the experience before you go out on your own. A consultant is suppose to be an expert. I have cleaned up a lot of messes from so-called expert consultants. Enough said.

Hope this helps,

Allen

Very good article!
Globalisation is a two edged sword: it can be in your favor if you can get good people for a lower rate, and it can endangering you, in case your job gets outsourced. Let me briefly touch these two aspects:
a) you are outsourcing: Usually, it is much easier saying than doing. As several posters already pointed out, it comes down to quality and trust. Price is just one part of the equation. Usually it involves quite a lot of overhead talking to somebody on the other side of the world rather than to somebody in the room next to you. Taking these effects into consideration, price differences are not that big anymore.

Actualy, from an economic point of view, the local price should be about equal the foreign price plus overhead (at least in teh long run). Offshoring only makes sense if the remote price plus overhead is less than the local price where you are located. This means, either you find somebody you can really trust and communicate well to lower the communication overhead, or you do it on a massive scale, to you get economies of scale (think: 100 software developers in India) with your communication overhead (e.g. sending somebody as local manager)

b) Yor job is endangered to get offshored: Well, here it is the same thing: If you ensure that working with you is frictionless, that your client can trust you, and you keep your promises, you can easily convince your client that it’s more economical to work with you locally, instead of offshoring. Managing your client well is here the key success factor.

Best regards,
Klaus

The world is becoming smaller and we should start to learn how to work with each other and live with each other. Money should not be the issue all the time, if i can help a talented person pay their bills and I am looking for more clients then yes I will outsource.

I recently outsourced work to the same designer that produced expectational work the first time around and his second project was a disaster. so nothing is known, if you outsource your taking a risk. I say outsource when your not prepared to loose a client and are too busy yourself doing other things for your business (full time business owner that is).

Excellent post.

I outsource to many overseas developers. I’ve got a php developer in Ukraine who turns out perfectly written, commented code as good as I’ve seen any western developer produce. But he does it at less than half the rate. In relation to the cost of living in his country he is well paid and happy. I can still charge the full rate to my customer for the work. It’s like a wholesale/retail relationship.

The key is in finding the good people. And when you do find them look after them. Be very clear with your specs pay them promptly when the work is complete.

I have to say there is certain value to this argument, but I’ve been to a couple of these “outsource sites” for freelancers, and the quality of DESIGN work is simply appalling. Coding may be a different story, but my online travels have led me to believe that third world countries can never complete in the design market.

Of course there are always exception to the rule, as with everything, but I’ve “bid” on 3 different sites and the portfolios for those bidding were terrible. That kind of work is cool for those little “niche” sites or buyers who are tech savvy themselves and just need a 15$ logo for their new online gambling site, but that will never fly for businesses who want to be taken seriously in the States.

Then there is the fact that something always gets lost in translation. Communication breaks down because they don’t fully grasp what you’re asking for, come back with something totally different and then you have to waste time either working with them to get it right, or just hire your local designer like you should of in the first place.

Sites like RAC and scriptlance, etc will still do good, I believe because there will always be someone willing to pay 15 dollars for a logo just to slap it on their new niche site. But for first rate quality design, so far, in my opinion no “outsourced” work has ever been able to compete.

I think that with so much talent in other countries, these developers should use those skills to stimulate their own economy. Amercian Software Developers have worked hard at building our economy, and those that have the programming knowledge shouldn’t have to worry about whether or not they will have a job in five years.

In fact, nationwide, CSC majors have dropped 14 percent in 4 year universities. Keep in mind, that this drop is occuring in the golden age of our information age. American students do their research, and nearly every Career Outlook guide mentions that Comptuer Programming jobs are subject to outsourcing, so therefore kids are finding better ways to spend their 4 years. So, in a nation where math and science skills was already on the decline (we import more foreign engineers than we have American engineers in alot of companies), computer science was thought of as a rewarding and lucrative career field until recently.

Obviously, a foreign software developer doesn’t care much about any of this, and I can’t blame you. You’re just fulfilling a need and utilizing your talents at the same time. However, eventually our government should cancel H1-Bs, provide more lucrative CS research positions, and provide more scholorships to American CSC students. The lack of tech talent per capita will hurt us more and more as time will tell. Hopefully, foreign software developers will have their own companies in place, drive internet trends, and become tech super powers of their own instead of just a pool of talented freelance developers.

I agree with a lot of the statements made in the posting above.

I don’t believe that just because someone can charge less for a piece of work that the quality will be less as a result. I work with a very fine young lady in India on my day-job and I would hire her at the drop of a dime due to the high quality of her work. She is also one of the very few technicians I have come across in my long career that still maintains a sense of “art” to her coding. Most technicians today have no concept of that and it shows in their development.

However, like any place you will find the good and the bad in development professionals and it doesn’t matter where they come from…

I have worked with many freelance programmers and have found many of them to be very good. I have also found some areas of the world where the programmers provide very poor work. You just have to find out who works well for you.

I have used several freelancers in the US and must say that the quality of product I get from them has been excellent. Part of that may be that there is no language barrier and part may be due to the fact that they’re traditionally trained. I have also noticed that they’re not necessarily more expensive when they bid on a job basis.

The idea of exploiting workers in 3rd world countries is just silly. Since when are you exploiting someone when you pay them more than they would get elsewhere?

As far as devaluing the local workers, I would agree in some aspects. Competition does tend to bring down the cost of a commodity. But I have noticed coders are becoming increasingly specialized and stratified. These specialty niche areas help them sustain their income level. What all of this means is that the industry is evolving to provide better product at a more affordable cost. That’s capitalism pure and simple.

As a freelancer..

I have to pay hundreds and thousands of dollars for my software. Some countries do not have copyright laws like here in the states, so if they are charging too little, it’s probably a good bet they are using pirated software. So even if they are good at what they do I will not work with them. Keep in mind that if someone here in the states is not charging anywhere near what you expect they are most likely using pirated software as well, unless they are students.Students get really good discounts, on some great software, so they may not have to charge as much, or they may not realize what a project should cost. It they are good throw them a bonus.

Language barriers is another thing, try to find someone you can work with that understands you. I bet you think I’m talking about another country, you would be wrong, but it applies there as well.Sometimes a concept that will seem obvious to you will be a total mystery to someone that comes from a different part of the world, even if it’s only a few hundred miles away. Example Georgia, USA and New York USA.

Overall I have to say I’ve worked with people from all over the world at one time or another,and with very little problems. I speak only English and I have done work on recipe cards and labels for French, Spanish, German, and Russian languages. Thats just the one I can remember right off the top.

Pirated Software and Communications are the two big items I watch for, other wise who cares if they are next door or in another county. If they are good at what they do, it’s all good. Eventually the pretenders will go out of business anyhow.

I would love a list of companies in India, Thailand, Philippines, etc. that are producing the same kind of quality creative work as Fantasy Interactive, Happy Cog, Clear Left and/or Poke London. I would be more than happy to send a shed load of work their way. Top-notch creative, standards-compliant sites and/or solid Flash/RIA skills coming out of India or anywhere in Asia at a much more competitive price would be magnificent. I haven’t seen it yet but I’d love to, and I’d definitely start outsourcing if I can find the quality I’m looking for.

Does someone have such a list of these companies’ URLs? Or are we just being presumptuous, assuming that such companies even exist?

@ James Chartreand- the post isn’t getting torched because critical comments are being censored by the moderators here.

“You get what you pay for” is true, whether you believe it or not. Just look at the toxic crap coming out of China or the sad state of outsourced tech support.

This article summed up: Outsource to make more money; everyone else is doing it.

Hey there,

Great article. Is interesting reading about your perspective in the free lance world from a more developed country. I think you made great points about outsourcing and freelancing. Let me give you my personal experience:

I work for a US agency in Costa Rica (where we don’t have super developed cities, but we have beautiful beaches and mountains, although the basic cost of life is not so different from the US). I’m a .NET developer, and let me tell you that the team that I work with is one of the most experienced and talented developers in platforms like Windows Media Center and Silverlight 2.0. Our work is as good as the work our colleagues do in the States, or sometimes better, and that’s only because I think we appreciate a little bit more the opportunities to do great work and have a job in a great company.

I also believe that most of the problems of low quality or the lack of standards and best practices are not because the lack of developer or designer skills, but generally because a poor management, which unfourtunately is very common in latin american companies. If you can lead your team, or guide outsourced teams, the result will be as good as you want it to be. And yes, we don’t get paid as in the US, but still we get paid pretty good for our country standards.

So there you go, we work for less, but we don’t feel exploited because we get paid pretty good for our standards and cost of living, we do great job, even better than anybody in the world in some specific platforms and tecnologies, and we work side by side with our colleagues in the States and Europe, learning from each other.

One last note….my colleagues from the US enjoy much more to come to our country, than us travelling to the states

@ Ex-Reader: They’re not moderating comments - yours made it through

It is ironic that some web professionals still think that the online world is restricted by borders and economies. There isn’t a market so susceptible to a global economy as the web market, the internet is as global as it gets. Better get used to it, online outsourcing is here to stay.

There are some large misconceptions regarding the reasons why some can afford lower rates. It is often the case that the cost of doing business in third world countries is far greater than in developed nations. Equipment often costs twice as much and last half as long due to conditions. Software also cost twice as much. Copy write laws are not as non existent as some people say. I have seen more people pirating, or sharing software in the US than overseas, that is simple there are more people with computers in the US. It is not because of pirated software that they can charge so much less, it is because they are willing to do it for less and are willing to make more sacrifices in order to make a living. I doubt that any one who charges $10/hour owns a 3 bedroom home and drives an SUV and went to a private University and vacations in Europe, but then again maybe they do.

As for the quality issue, come on, web design and development is not rocket science. It does not take that much effort to learn standards and to create good code, and there are very few truly gifted designers out there anyway. It mostly takes experience and the willing to learn, the overseas market is catching up on the experience and the literature is being translated (if not originating) in local languages. The arguments on quality are becoming less of an issue. There are plenty of great talent out there, happy cog is great but they are not the holly grail. There are only so many companies of that caliber in the world, but there is plenty of very good quality work being done all over the place by all sorts of people.

Here is the funny thing, the way things are going, the emerging economies, who have conquered a large and growing share of the internet production market, will need to increase their rates to make up for the weakening dollar value, and the local US market will be forced to lower their rates to attract clients and eventually the rates will not be that much different.

I have to chime in here and say I agree with a lot of the “negative” comments. Not that it’s these guys fault that they work for low rates like one poster said, it’s just the quality is so abysmal it’s not even funny. That age old adage has never been more true, you get what you pay for. If you’re an up and coming small business, or even a medium size business, if all you care about your business is a 15 dollar logo and a 50 dollar website, I don’t think you’re serious about your business. As for Mrs Swim’s “elitist” comment, you must be a democrat no doubt.

Like I said, I think coding wise, they’ll have a market, but in the visual department they’ll never compete. Atleast, that’s been my experience for the last 6 or 7 years. Maybe that’s where the American “elitist” attitude comes from, is a little bit of confidence. But that being said, I couldn’t fathom any local small or medium size business that I know of, get on a shoddy looking site like RAC and try to get themselves a website. So I think the only business that these guys take is business we wouldn’t get anyway, or surely wouldn’t want, so I don’t think it makes a difference. Atleast from a freelance perspective.

Getting into work visas and overseas support etc, is a bit of a different story, and more for a different article.

Lea, thanks for having the courage to write this!

@ EX-READER: if all you can spew is vitriole then the comments board and readership is better without your negative presence.

Give Peace A Chance

I think our business’ strong point is no only our skills but our clients.

I work from Argentina mainly for clients in Spain, Switzerland and other European countries. The key here is that it’s quite difficult if not impossible to build a solid and long-lasting relationship with a end-client if you live 10.000 Km from him. So really there is not such a big risk here for local professionals.

Just as the article points out the outsourcing business works when there are two professionals who are interested in collaborating, and this is a mutual convenience thing. I don’t work for end clients but for designers who have either too much work or need extra skills, or simply want to earn more money investing less time.

I’ve built a team for this and I work with 3 to 4 in-house people here and that enables me to better meet deadlines, broaden the offered skills and offer a comprehensive service, this is important because an individual tends to be more “alone” faced to a particular job.

A web designer is a much stricter judge for my work than a end-client is so I have to keep high standards in my work.

Our mission is to be business partners with other designers. Our designer-clients may feel then that they have a complete team with broad skills at their hands for a fraction of the cost it would take to build a team like that for a freelancer.

Okay, we’ve established that companies in these cheaper countries are highly competitive when it comes to price but nobody have given one single example of a company that’s producing world class design services at knock down prices. You know… just to see if they’re as competitive on quality, which is also very important.

This argument isn’t anything new - it’s starting to get quite stale now to be honest. Web outsourcing has been around for a while but, more often than not in my experience, clients come running back screaming.

A list of quality outsourcing companies would be great. Anyone?

Jobs will always migrate to the lowest cost producer. If you enjoy designing, developing or doing any sort of skilled labor and that labor can be done more cheaply elsewhere - it will be. The bottom line is that you will not be able to support yourself doing something you enjoy.

I support free markets inasmuch as they work to improve my standard of living. I’m not religious about free markets though; if “free” means I can no longer make a living doing something I enjoy then I’m opposed to that kind of “free”. Countries are not companies; they, at least in theory, should act so as to improve the lives of their citizens.

If you’re the kind of person who enjoys your work for what you create or design - basically any kind of craftsman (programmer, website designer, engineer, etc…) then outsourcing is a threat to your way of life. If you’re the kind of person who can enjoy a job even if it doesn’t create anything tangible, if the money alone is enough to keep you in a job, then you’re probably a businessperson and you’re going to outsource wherever you can.

Its funny to read the reaction in some of the comments about people in other countries “stealing” jobs to US…. And they forgot that US has been exploiting (stealing?) resources in most of these countries for many many years.