During my years running my own web business I’ve both taken work on a sub-contract, and sub-contracted out work when I need help. While it can be a great thing, it can also be a big pain in the ass.

I’m not talking about the managing of other people, that’s just par for hiring or being hired. If you’re sub-contracting it introduces a layer between you and the client. It’s more likely that communication lines will be crossed. Same goes if you’re hiring someone to do a portion of a project. You know the requirements and either don’t communicate them properly or their not understood. The big issue for me is getting paid when I’m sub-contracting from someone else.

The things I’ve found quite common is that the freelancer wants to pay me after they have been paid by their client. This allows them to stop managing their cashflow, they try to take a loan on you. I don’t let that fly, if you want me to wait for the client then I’m invoicing them directly, on my terms. You’re taking a loan off me and you want it to be interest free. I’m not your bank, so I’m not in the loan business and I’m certainly not letting you hang on to my money interest free.

As far as I’m concerned it’s your job to have the cashflow to support your business. I know when I sub-contract to others I pay them right away, no questions asked. My cashflow is not their problem. They do not wait for my client to pay me, I’m their client. I pay them swiftly with no issues once the agreed upon deliverable is delivered.

So if you’re thinking about sub-contracting work, make sure you have the cash around to afford it. If you’re starting out, don’t agree to wait to get paid. Make sure they sign you’re contract and agree to pay you on the terms you feel comfortable with.

photo credit: pasukaru76 cc

2 responses to “Your Cashflow – Not my Problem”

  1. Matt Graham Avatar

    I’ve been subcontracted recently, and this (thankfully) has never been the case with my, erm, hirer. She always had paid me when the work is done, not when the client has paid her. Just lucky I guess. 🙂

    1. curtismchale Avatar

      Most times I’ve not had an issues. I’ve found that the larger the company the more likely it is they want to pay you on longer terms. Maybe I just need to say no to all larger companies.