Small Biz Tech Talk ™

U.S. solution providers are discovering that when small businesses and IT consulting firms outsource help desk services and others to consultants in other countries, particularly India, they are losing money.  Thus, many U.S. solution providers are choosing to use near-shoring service models.  

Solution providers are starting to think about outsourcing services to Canada, where they can either beat or match the prices of Indian subcontractors and get high quality technical services.  According to experts, the cost for India-based services, while suspected by many to be 30 cents on the dollar is actually closer to 60 cents on the dollar.  

Companies choosing to sign outsourcing contracts end up paying 5 to 7 percent in order to manage it in the U.S.  The cost to manage outsourcing contracts in India is 20 to 25 percent, meaning adding the additional 60 percent makes the cost 85 percent higher than if solution providers use a near-shoring services model.  

Many clients and solution providers are stating that using Indian subcontractors, particularly for help desk support has also caused some problems because of the language barrier.  U.S. solution providers believe that near-shoring to companies in Canada will help improve communications and the qualities of the solutions they can provide to English-speaking clients.

IT consulting firms such as CompuComm, with three North American service support centers – one in Dallas and two in Toronto, Ontario – are starting to focus on Canada and the U.S. to provide a majority of their services.  While still using some help from Indian solution providers, companies like CompuComm would like to focus more on Canada for help.

While Canada is less expensive than the U.S., it is still not necessarily the lowest cost option, as India is still often most affordable.  Still, many English speaking customers would prefer to have voice support that is understandable.  CompuComm is also considering adding an offshore support source in Costa Rica in order to offer more dependable and comprehensive support.

For more information on this trend for solution providers, see the attached link.

Blogged By:  Joshua Feinberg

Subcontractors can help boost your business significantly by allowing you to provide services you otherwise could not offer.  The issue though becomes, how do you keep a subcontractor from taking your clients?

This is a huge concern when IT consultants start considering bringing in a subcontractor. But, if you are doing it right, then anyone you subcontract to should not be competing with you in the first place.  Here are some tips for hiring subcontractors:

Hiring Subcontractors

• Be sure to research every company you consider subcontracting to.  If they compete directly with you, keep shopping around.  You really want to get people that are in deep niches that don’t do what it is that you do.  

• Meet with a potential subcontractor a few times.  Just like you don’t want to jump into bed with someone on the first date; you don’t want to subcontract work to someone you met 10 minutes ago. Let the relationship evolve after a few lunches, exchanges of email, etc… You need to be able to trust your subcontractors.  

• Have every subcontractor complete an agreement that includes non-compete and non-disclosure clauses. Have your agreements reviewed by an attorney. Remember that no amount of paperwork will stop someone who’s determined to get the better of you, but it will make it harder for them to do so.  

Bottom Line on Subcontractors
Finding a subcontractor is only the first part.  Once you find a potential subcontractor it is your responsibility to ensure he/she is trustworthy.  Go through a process of due diligence before introducing any subcontractor to your clients.

In this article, you’ve been introduced to Subcontractors. To learn more about how you can improve your knowledge about Subcontractors, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

Subcontracting often means providing services to clients that you would not normally provide.  For whatever reason the service you are subcontracting is not something you consider to be part of your core business.  So the question is, how should you view a client’s request for services outside of the scope of your business?

When faced with a subcontracting decision you need to ask yourself:

• Should I do it?
• Do I have to do it?
• Do I need to do it?
• Do I want to do it?  

Subcontracting does involve costs.  But, in terms of long term clients there’s a certain obligation that comes along with it too.  When you have a client on a long term service agreement then subcontracting is the way you can provide exemplary service.  

As an IT provider for a long term, steady client you should strive to provide any and all IT related services. If subcontracting will allow you to that, then the decision to go ahead is easy and straightforward.

Think of subcontracting as an opportunity to grow your client relationships a lot deeper.  Subcontracting services you wouldn’t provide yourself takes your customer service to a whole new level.  These are the things that clients remember when they talk to their business contacts, when they make referrals, and when they write testimonials.

Subcontracting is also an opportunity for you to bring on a new partner or vendor.  This gives your firm a much wider service capability that you can potentially use with other prospects and clients down the road.  

The most important benefit of subcontracting is the networking potential with these niche technology providers.  These people are an excellent referral source.  Your subcontracting to them, might result in them subcontracting to you down the road.   

Bottom Line on Subcontracting
Subcontracting services you don’t normally provide is almost an obligation for your long term clients who are on service agreements. Don’t think of subcontracting as an obligation though, it is really more an opportunity to deliver superior service and make excellent contacts with the people you are subcontracting to.

In this article, you’ve been introduced to Subcontracting. To learn more about how you can improve your knowledge about Subcontracting, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

IT services outsourcing is what you need to do when, not if, your prospects ask for products and services that you are not able to deliver.  Many new business owners think they need to know everything.  They fear not being able to offer every service under the sun.  

The great thing about the computer industry is that there are plenty of people you can use for IT services outsourcing. When you first start up, your concentration needs to be on getting business.  You need to spend time networking and relationship marketing.  

In order to have the time to do this you need to rely on IT services outsourcing - there just simply is not enough time for you to learn everything you will be asked to deliver.

Rather than lose the relationship, you want to be able to offer your prospects the services they need.  To do this you essentially have two alternatives for IT services outsourcing:

Work out referral relationships with other niche technology providers in your area  
Set up partnerships and subcontractor relationships

The quickest and easiest way to set up your IT services outsourcing is to set up partnerships or subcontractor relationships.  This is a fast and efficient way to deal with the issue.  

Of course, if you continue to get lots of requests for the same type of IT services, then you should probably consider getting the skills to offer it in-house.  When there is a large enough need then the time and money invested make good sense. Until that time though, IT services outsourcing is your best option.

Bottom Line on IT Services Outsourcing
Like it or not you can’t know everything.  When prospects ask for services you don’t offer, rather than lose the relationship, look to IT services outsourcing instead.  Build referral relationships with other niche IT service providers or set up subcontractor or partnership arrangements.  By doing this you maintain your client and leave yourself open to the possibility of offering the service yourself down the road.

In this article, you’ve been introduced to IT Services Outsourcing. To learn more about how you can improve your knowledge about IT Services Outsourcing, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

If you are like most computer consultants, you are a generalist and can benefit from partnering with specialists.

Consultants often like to hire contractors to add talent to their team without the fixed overhead burdens of salaries and benefits. Subcontractors, like partners, are often brought in for specialty, occasional needs.

Read on to see how one of our computer consultants grew his business last year:

"My biggest achievement was finding and keeping another good technician. It helped with motivation knowing that I am not a lone ranger and it is possible to make money in computers."

Chris Fisher, Computer Guys
Central Point, Oregon

The Bottom Line about Partnering

To learn more about partnering and subcontracting, click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

As few as seven or eight years ago, Internet connectivity in the marketplace was a possibility but not a sure thing. The only important thing was to ensure that your computer was maintained through PC support contracts.

Today, however, trying to do business without the Internet is difficult so many PC support contracts have evolved to include internet based support as well.

Time To Manage All Facets Of The Business

Technology has galloped past those first connection speeds based on 28.8 and 56K modems that carried connections for around 10 years. After that came ISDN and corporate T1 lines. Today, network service providers are offering broadband.

With that as a benchmark, it’s fair to say that corporate Internet is a given. And now we’re looking at wireless network connectivity fast becoming the norm.  As a result of the changes, current PC support contracts often maintain Internet, PC, virus and software requirements.

Delivering a Reliable Service

Among the wide range of Internet service options that we take for granted are online billing and payment, general information flow, intranet and internet marketing and publicity and communication via email. As a result, businesses everywhere now rely on functioning PCs and PC support contracts to ensure that the systems continue to function in the long term.

With these possibilities, of course, services such as email security, data backup and recovery, and network management become even more critical. So the importance of PC support contracts is elevated and indeed a key selling point for computer consultants who can offer PC support contracts to customers.

Times are Changing

Just five years ago the notion of PC support contracts for Internet or email services might have seemed very odd but these days it is common for PC support contracts to include Internet support as well.

The Bottom Line about PC Support Contracts

In this article, you’ve been introduced to pc support contracts. To learn more about pc support contracts, click here now to get access to free tips and an audio training excerpt on pc support contracts.

While you should talk to a lawyer about the specific differences between subcontractors and employees, this article will present you with a list of things to watch out for when utilizing subcontracting.

Subcontracting: Make Sure The Relationship Meet the Test

I suggest, however, that you contact your accountant or your lawyer, or check the IRS page for further information on any topic dealing with the differences between employees and subcontactors or the IRS-20 point rule.

• You want to make sure that your subcontractors own their own tools
• You want to make sure you’re not providing them with a laptop or protocol analyzers or anything else that would be expected if someone had their own network integration or service kind of business
• You want to make sure that they have control over things - that you’re not executing the same degree of control over them that you would an employee
• You want to make sure that they have many clients
• You want to make sure that they have the ability to sustain a loss.You want to make sure that they market to the public or that they have a listing in the phone book
• You want to make sure that you are not paying by the hour
• You want to be writing the check to the company, not the individual.

There are a whole bunch of rules that come into play with subcontracting. When you’re talking about setting up subcontractor relationships, it’s very important to make sure that you get all you t’s crossed and i’s dotted.

The Bottom Line about Subcontracting

In this article, you’ve learned about subcontracting. To learn more about subcontracting, click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.