The MiddleMan – Friend or Foe?

We’ve talked previously about how to find clients. There are a lot of places online where you can easily find clients and work. This is especially true if you’re a computer professional, whether a programmer, a blogger, a data entry specialist, etc. There are several reputable websites that are designed specifically to bring together freelancer and potential clients, thereby creating a large central pool of providers and buyers. Examples of these are Scriptlance, Elance, oDesk, etc. These all have their different models and have various advantages and disadvantages. I will be talking about these services one by one in upcoming posts and invite you to submit reviews of any such services that you may have used.

One thing that all these services have in common is that they play the role of the MiddleMan. According to the Meriam-Webster Dictionary, a middleman is “an intermediary or agent between two parties; especially : a dealer, agent, or company intermediate between the producer of goods and the retailer or consumer”.

In the world of freelancing, the middleman can be your friend or foe, and this is something that you must determine.

Advantages of the Middleman in this context:

  1. Pools together clients and providers, creating a central space where you can find work without searching too far
  2. Following from above, creates a central space where you can build a reputation through rankings and other such features, allowing potential clients to be aware of you
  3. Takes care of the financial transactions by collecting and disbursing funds, thus all you have to do is wait for payment
  4. Many middlemen offer escrow thus ensuring that you will get payment for your services
  5. Can act as arbitrators in case of disputes between clients and providers
  6. Offer privacy so that your contact information is not divulged
  7. etc…

Disadvantages of the Middleman

  1. Takes a cut of your earnings
  2. Limits communication between you and potential clients to the middleman’s medium, i.e. you usually cannot communicate directly with the client say via private email
  3. Does not always create a level playing field because providers are accepted from all over the world, and hence you may be easily outbiid by someone with a currency advantage
  4. etc…
  5. Bear in mind that these advantages and disadvantages are pretty generic and may not apply to every middleman out there. You can also add more to this list. I will be updating these frequently.

    So, given these pros and cons, what should a freelancer do?

    While the benefits of having a central resource where you can find work and are guaranteed payment are great, they are often overruled by the challenge that freelancers, especially from countries such as the US and Great Britain will face trying to compete in bidding with providers from India and China who are likely to bid low because of the currency difference.

    The other big challenge that a new freelancer to these services faces is getting their first job. Jobs tend to be awarded to those freelancers with high ranks and who have been providers for a while, so breaking in can be hard.

    While it is good to explore all options, and it is definitely worth giving these services a try, a new freelancer should never depend solely on services like elance or scriptlance for work, but should be out there searching and networking, not depending completely on the middleman.

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