Loading...
Answers
MenuIs it better to have a high-touch or low/no-touch approach when using sub-contractors in a service business i.e.should they speak to clients directly?
This question has no further details.
Answers
I have had very little success allowing subcontractors to talk directly to clients. As much as it's annoying to play telephone, typically the subcontractor has less skin in the game, less communication skills, etc., and it reflects poorly on you.
Working in this space, I can elaborate on this a little bit.
If your business model is around competing on price and all your competitors are very close to you in price point, you need to differentiate yourself. Providing a high touch service could be one way of doing it.
In terms of deciding whether or not the sub contractors should provide the high touch service, I would ask you the following question: are the sub contractors given any incentive to go the extra mile to provide that high touch service? If the answer is no, you should see if you can incorporate a customer feedback component into their compensation in the form of a kicker.
When you answer the first question about differentiation and the second question about the sub contractor incentive structure, I think you will get the answer that's right for you.
I work extensively in this space. I'd be interested to know how you progressed since writing the question since it has aged so much.
Hi David,
Thanks for your reply. There has been interesting progress in our business. When looking at the competition in my niche, almost all have stalled for growth at 2-3 subcontractors whilst we now have hundreds. My guess is that the admin of trying to be the "middle-man" was too much of a load and they didn't have the systems in place or a competitive enough revenue structure to sustain additional growth.
We do have a small amount of work that is lost due to subcontractors working directly with clients but the flip-side is that the rest of our workers feel trusted and stay with us for years.
Another factor we need to constantly consider is the amount of value we provide vs the percentage that we charge. People do have an innate sense of fairness and if they see you doing X amount of work and getting paid XX, then they feel more pressure to bypass the system. We tell our subcontractors and clients that our main role is to provide as much value as possible in the areas that we're good at in the transaction, providing the best systems we can (so the transactions are as smooth as possible) and then stay out of the way so they can build a relationship.
I hope this helps give an update. I've put together a course on marketplaces on Udemy that addresses more marketplace factors as it's been so interesting finding what works and doesn't work for us.
Related Questions
-
Who are the top 5 thought leaders on scaling companies?
Nichole's list is comprised of people who talk about growth marketing. Although growth marketing is a component of scaling-up, scaling a company is much more about operational issues. Everything from tech stack to culture to legal and compliance and almost always sales. On growth, there are a lot of people who talk about the principles of growth from a marketing perspective and a couple of people on Nichole's list are known for *talking* about growth but I'm generally wary of people who are more known for *talking* than actual notable accomplishments in growing products. Ivan Kirigin (formerly on Dropbox's growth team, now running a company I invested in called YesGraph), Gustaf Alstromer (AirBnb growth team), Elliot Shmukler (helped LinkedIn grow from 20m to 200m members, now in-charge of growth at Wealthfront who has been absolutely killing it), Drew Dillon (an early PM at Yammer, now Head of Product at AnyPerks), are all active on Twitter. Actually Elliot isn't but you can still search quotes he's made about growth via Twitter using his name. If you have more specific questions, am happy to try and point you to the right resources.TW
-
After validating an idea for a physical product with users, how do you know it will also scale and move through the innovators and early adopters?
Hi there! 1-. Keep on asking for feedback for your product and adjust it 100% to what your first users want 2-. Go for the wow factor. Make their product amazing (think about an iphone design) and last 3-. Make sure these early adopters use your product everyday (or as many times per week as they can). This will make them talk about your product with others. Others: - give discounts to the early adopters and to the new users when an early adopter refer to someone the product All the best! LauraLM
-
What challenges will I face with security and scalability using wordpress for a marketplace product?
Hi I have personally used Wordpress for numerous projects - both simple and complicated, and in all cases the websites have worked fine and have been easy to manage. A good place to hire someone to build the website for you at reasonable prices is on Fiverr. Just be sure that you have a very clear specification document (description of the project) and that you clearly define expectations with the programmer. If it’s a project that costs more than $3,000, and if you’re using someone in the same country as you are located, then I would consider drafting a services agreement. I can help you with any and all of the above if needed. Good luckAB
-
When is the right time to get a COO?
it sounds like you've already answered your own question – you needed a COO yesterday. I would disagree with your CMO that adding a COO is just adding "another layer". It is, in fact, what keeps the lights on. If your house isn't in order, everything else falls apart. With 26 employees, one of your biggest ongoing challenges will be your culture, and managing the morale, motivation, and performance of your people. Outside investors are interested in a number of things – not the least of which are your operating margins, who does what, and how efficiently the whole organizational structure is organized and communicates. One last thing: don't make the mistake of just hiring for skills or experiences. Fit is especially critical in a COO role. if you haven't done so already, define your culture, define your vision, define your values. Then work on developing a performance-oriented job description for the COO, then start your search. In that order. I'm happy to jump on a call to talk more, and help to strengthen the business case to your CXX colleagues if needed.GN
-
What should I focus on to scale up, as a web development agency business owner?
I would advice you to understand the three stages of focus namely, Orienting, Selective Attention, Open Awareness. Currently I believe you are in Orienting stage. Try to move on to the next stage and that would help. Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonathJB
the startups.com platform
Copyright © 2025 Startups.com. All rights reserved.