Should You Be a Freelancer or an Agency?

Cartoon people captioned Freelancer vs. Agency
If you're going out on your own, you may be wondering whether to be a freelancer or an agency. This post shares 5 factors to consider.

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Reading Time: 4 minutes

Introduction

Having worked as an individual freelancer before forming my own company, I’m sometimes asked why I decided to go the agency route. In this post, I’ll share five Vs to consider when deciding whether to be a freelancer or an agency.

Versatility

If you work as a solo freelancer, you can specialize in what you’re best at. No one expects you to be an expert at everything. The downside is, the types of projects you can take on are limited by your own knowledge and expertise. Of course, you could subcontract some work to other freelancers, but that can be a slippery slope if clients are expecting you to do the work yourself.

Agencies can offer clients a full-service experience, with a team of instructional designers, editors, QA specialists, graphic artists, web developers, videographers, voiceover artists, and more. Clients generally expect higher quality deliverables in shorter timeframes when working with an agency. Fortunately, the team approach allows agencies to accomplish the work in less time.

Through Scissortail, I’ve been able to take on large projects I wouldn’t have been able to accomplish by myself. And my agency produces better work than I can do alone because tasks are assigned according to each team member’s strengths.

Value

Freelancers are generally perceived as less expensive than agencies, thus giving them an advantage when seeking contracts with budget-conscious companies. Some organizations, such as staffing agencies and small nonprofits, prefer to work with individual freelancers.

On the other hand, organizations seeking help with large projects often like to subcontract to agencies, so they don’t have form agreements with multiple individuals. Having a “one-stop shop” that functions as an extension of the company’s team is very appealing to many clients.

Some potential clients may assume that the agency’s rates are higher than they can afford or that they’ll get a better rate by contracting directly with individuals. But the reality is, working with an agency has benefits that can be worth a slightly higher price.

Variability

When a company contracts with an individual freelancer they’ve worked with before, they know what to expect in terms of quality and style. It’s easy to be consistent when you’re just one person. (At least, it should be.)

With an agency, it can be more difficult to ensure that level of consistency. If three instructional designers are designing different pieces of the same project, you may end up with three very different styles in terms of look and feel, instructional strategies, and tone. Style guides, standard operating procedures, and quality assurance checks are critical for ensuring consistency.

The potential for inconsistencies doesn’t necessarily spell bad news for agencies. For large projects, it can make more sense for an organization to subcontract the work to an agency than to award multiple subcontracts to various individual freelancers. That’s because an agency with quality assurance measures in place can manage the task of ensuring consistency among the different individuals working on the project—rather than the client having to do this type of quality assurance themselves.  

oVersight

(Okay, I cheated a little on this “V.”)

When deciding whether you should be a freelancer or an agency, you have to consider how much administrative work you want to do. Either way, you’re going to be running a business, and that comes with certain managerial tasks such as invoicing, accounting, and marketing.

Freelancers should set aside at least 8 hours a week for working ON their business rather than IN their business. (Thanks to the eLearning Freelancers Bootcamp for this distinction and advice.)

For an agency, administrative tasks can eat up more of your time, giving you less time for hands-on learning experience design and development work. If you’re running an agency, you probably need at least 16 hours a week for administrative tasks—and the bigger the agency, the more time you’ll need to run it. As your company grows, your role may need to shift to that of a CEO rather than a designer.

Vacationing

This one’s on my mind because I’ve been on vacation for the past two weeks, seeing some of our nation’s sites and visiting with my granddaughter for her first birthday.

When you’re a solo freelancer, it’s hard to take a real vacation. Ideally, you could take time off between projects. But unless you’re working on a full-time contract, you will probably have several projects going at once, in overlapping stages of development. This means there might not be any gaps between projects during which you could take vacation time. However, if you do happen to plan your projects so you get that much-needed down time, you can take time off without worry.

When you run an agency, it’s even more likely that you’ll never have a lull between projects. However, you can shift responsibilities to other trusted team members, so work doesn’t have to stop when you’re away. Of course, you may have to manage other aspects of running a business during your vacation, such as paying or sending invoices, setting up contracts, or communicating with clients.

During my vacation, my team has had everything under control (and I owe a special thanks to Monique for running things in my absence). Other than the blog and payroll, I haven’t had to worry about much while I’ve been away. And because other team members have continued working, two weeks off doesn’t mean two weeks with no income.

Summary

As a recap, here’s a list summarizing the points in this post. What other pros and cons can you think of? Share your tips in the comments below.

Pros and Cons of freelancing versus agency. See the text for the full description.

Freelancer Pros

  • Specialization
  • Perception of being less expensive
  • More opportunities with staffing agencies
  • Consistency
  • More time for hands-on design work

Freelancer Cons

  • Limitations in types of projects
  • Fewer opportunities with large companies
  • Unpaid (or nonexistent) vacations

Agency Pros

  • Flexibility and versatility
  • More opportunities with large companies
  • Greater capabilities
  • "One-stop shop" for clients
  • Built-in backup support/bench strength

Agency Cons

  • Higher expectations from clients
  • Perception of being less affordable
  • Fewer opportunities with staffing agencies
  • Extra effort required for consistency
  • More administrative work

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