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Old 07-01-2001, 03:41 PM
DR4296 DR4296 is offline
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Join Date: Jun 2000
Posts: 86

Looking for info on subcontracting

Greetings All !

I'm a small-time reseller with about 15 sites underneath him.

Recently, I encountered somebody, a gentleman in his 40's, who was looking for work. He said he really wanted to get into Web Design and has a Certificate from New Horizons, but can't seem to get hired anywhere. (Yeah, I know... New Horizons... ooh-boy!)

Anyways, I told him that I might be able to outsource / send him some web-design work. Told him that it had the potential to become full-time (possibly) someday, but that right now, I could send him a little bit of work to help him make ends meet.

So, now I've introduced him to two new clients whom he's going to meet with this week and discuss their site design needs.

OK, fine, we're off to a good start.

But I need to define more rules for our relationship, including the percentage that my company gets, the fact that I'd like him to act as if he's employed by my company, and other issues to protect us both and divide up the work.

But I'm having trouble locating the "how-to's" when it comes to outsourcing ! I need legal rules, possibly contracts, and just general procedures and how-to's for operating on a daily basis.

I am quite new to this, as you can tell.

I admit, I work full-time doing something else. Haven't ever gotten into the outsourcing or hiring issues.

So, can anybody give me some advice, URL's, or otherwise to help point the way ?


-= Dave =-

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Old 07-01-2001, 10:46 PM
JayC JayC is offline
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Join Date: Aug 2000
Location: NYC
Posts: 6,627
A lot depends on how you want to structure the relationship between your company (or yourself, if you're operating as an individual), your subcontractor, and the client. Here's a scenario:

First, assuming that while you said you want him "act as if he's employed by my company" he's not an employee, you need some sort of a written "Work For Hire Agreement" between him and your company. It can be pretty vague, but establishes that he's a subcontractor answering to you. It should state who owns rights to the work product, and could include confidentiality clauses (or that could be a separate agreement).

Then, since you make initial contact with the clients, you should also get a written agreement with them. Things will be vague because they haven't gone into details, or thought them through, until they talk to your subcontractor. So instead of a full-blown contract at this point, you might want to use what my company calls a "Memorandum of Engagement." It just specifies that we're doing work for the client, and what will be done -- and billed -- before execution of a detailed contract.

If, as it sounds, you want a lot of control, the contract for site design and production should be between you and the client. So after the subcontractor meets with them, he should report it to you and you produce the contract -- or just let him do it in your name. Then you do the billing, and pay him.

A downside of this is that if someone doesn't pay, you're the one who's stuck. But if you want the subcontractor to do the billing, they have to execute the contract with the client in their own name. Again, just by my reading of your post, that doesn't sound like what you want.

Of course, there's a whole different, and simpler, approach you could take, in which you just refer clients to him and he pays you for the referral. Then he does all the work, and takes all the risks, but the work isn't done in your name. In that case, you just need an agreement with the subcontractor that specifies the payment schedule. That's probably a more common approach taken by someone in your situation, actually.

Specializing in SEO and PPC management.

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Old 07-02-2001, 05:23 AM
DR4296 DR4296 is offline
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Join Date: Jun 2000
Posts: 86
Thumbs up Thanks!

Thanks for your helpful advice!

I've printed your post up for some serious reference/thought later this morning!

You're right, I do want a decent amount of control, which may be tricky to negotiate. But I'm willing to take on the extra risk as necessary.

Thanks Again !

-= Dave =-

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Old 07-02-2001, 09:59 AM
eclipsewebs eclipsewebs is offline
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Join Date: Jun 2001
Location: Piedmont, SC
Posts: 84


We have a referral relationship with a hosting company. Basically we have a quarterly sliding referral commision that we send them, that ranges from 5 to 10 percent depending on actual refered sales in that quarter. We also do site maintenance for them as needed. This agreement is written down so that both sides know what it is. It is more of an alliance with one another than anything else. If you go this route, you need to know what his pricing is going to be. If he charges $50 for an entire site, it may not be worth it for you, unless he can do 100 sites a month (highly unlikely). On the other hand, it would not look good for you if he charges extremely high rates and no one takes him up on it.

Have you seen anything that this person has done? You want tom make sure that he is capable of producing the sites that your customers want. Since he is representing your company, you need to make sure. A lot of people call think that they are web designers, but have no clue on how to create decent web sites. Does he have or can he use any Graphic Design tools? My favorite site to refer people to is I don't think this is what you want representing you, but it is out there and available.

As far as meeting your clients, is this face to face. Does he act professional and is he presentable. In my real work I deal with hiring contractors (Contract Development Manager). I see all sorts of people come across my desk. When you bring them in to interview, that first impression always is a factor. I had one lady who looked perfect on paper. When she showed up for the interview, she must have smoked an entire pack of cigarettes in her car before she came in. Since we have a smokeless environment, it was quite unpleasent. (I am not against smokers). I have had others who had the right buzz words on their resumes, but couldn't communicate in and effective manor.

Basically make sure you do not reference him as an employee, unless you want him to be an employee. Microsoft can attest to this. They got sued by contractors for 401K benefits because they were treated like employees. Also, make sure you see what he can do, even if he is only a referral. Your clients will relate is work back to you no matter what, since you referred him.

Good Luck

Greg Jensen
eClipse Web Solutions, Inc.: - Complete Web Based Solution Provider - Windows Web Hosting

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Old 07-03-2001, 04:40 AM
DR4296 DR4296 is offline
Junior Guru Wannabe
Join Date: Jun 2000
Posts: 86
Thumbs up Thanks !

Thanks for the advice!

Yeah, I have some concerns about this guys skills and his personality. He tends to act like a know-it-all. But right now, when it comes to actual experience in site design, I exceed him quite a bit (I'm talking in sites that are actually out there "live" right now), so he's deferring to my judgement for the moment.

He's big on "DreamWeaver".

I'll watch my steps carefully.


-= Dave =-

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Old 07-03-2001, 02:11 PM
Honu Honu is offline
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Join Date: May 2001
Location: Maui, HI
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not sure if any of these links will help y aout or not ????

again these may lead to some ideas you can put together

Aloha, Chad
To do a move in such a way that no one suspects let alone detects !!!

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Old 07-06-2001, 05:12 PM
Phoenix Phoenix is offline
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Join Date: Apr 2001
Location: Boston Metro
Posts: 345
So basically, you've got a brand new web designer with a freshly inked certificate from New Horizon, wanting you to provide him with business.

Web designers are great partners for web hosts, but, the newbies usually need your help getting up to speed.

Be aware as you negotiate your deal with him that you will probably spend a lot of time at first training him on how the web works and providing him with hands-on tech support-make sure that someone is paying for that or any money you gain from doing business with him will be lost that way.

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