February 8, 2023
More and more companies are hiring freelancers. Why is that? And why are some fashion & luxury brands still hesitant to get on board?
Six Client Objections Discussed.
I read recently that in the tech industry 78% of companies will rely on freelancing in 2023 rather than adding to permanent staff. Take a moment to think about this. It is a staggering number and yet, many fashion & luxury brands are still hesitant or simply are not aware this solution exists. In every client meeting I hear the same objections around hiring freelance talent – will they be committed? Will they be loyal? Where will I find them? Can I trust them with my confidential product information?
In parallel, I perceive a certain nervousness around finding the right permanent staff – it takes too long to find someone who understands my brand, I don’t have the money for headcount, what if the market takes a bad turn, and so on. I understand both sides of this problem.
The idea of working with freelancers is appealing but some companies are unsure of where to find good quality talent. Hiring permanent staff in today’s volatile market is also a risk. As stated in this Business of Fashion article, “Executives will need to prepare for multiple scenarios and ensure they have the agility to pivot on a dime.”
The ‘gig economy’ is here to stay and there is no reason to fear it. Freelance employment typically focuses on creating a short-term relationship with a client for specialty projects or time periods. And while some are ‘side hustling,’ there is a huge portion of freelance workers who have high-in-demand skills and no desire to work in permanent employment. The European Forum of Independent Professionals (EFIP) calls them i-Pros (Professional Intellectuals) and the benefits of working with them far outweigh any perceived client risks. Here’s why…
Reason No 1: A permanent bad hire can be expensive.
Freelance response: Invest in flexibility.
Making a permanent bad hire can be disruptive and expensive. According to the United States Department of Labor the cost of a bad hire can be up to 30% of the employee’s wages for the first year. That can equate to a lot of money in a market that’s constantly looking to keep expenses tight. And this percentage is just on quantifiable outgoings. It excludes the time and energy lost on onboarding, training and facilitating a new hire within the company itself. In another study, 34% of CFOs said that not only do bad hires cost them productivity, but managers also have to spend 17% of their time supervising poorly-performing employees.
This is where testing a freelancer really makes sense. Your money is invested per day worked rather than spent on a lengthy hiring process or onboarding. Here time worked = money spent. It’s that simple.
If the partnership is not working out for whatever reason, you move on. It’s all about the ability to make those dynamic pivots. And if there is a need for more of a long term solution then there is the option of making it permanent without the additional interviews, agency fees, psychometric tests, etc.
Reason No 2: I need someone now!
Freelance response: Freelancers are ready to hit the ground running.
According to the Society of Human Resource Management (SHRM), the average hiring process is around 42 days. Considering recruiter meetings, stage interviews, notice periods, onboarding and potential further training, it could take even longer.
A survey of 210 CEO’s conducted by Harvard Business School cited that business owners expect an employee to reach a break-even point six months into the job. After six months, an employee should have enough training and institutional knowledge to add value to an organisation. In total this becomes a very long waiting period to solve a current work related problem.
Freelancers can fill that lengthy time gap. They are available within a short notice period (sometimes as quickly as a day or two) and want to get to work as quickly as possible. For them time is also money. They realise that in order to secure repeat business they need to provide solutions to their clients ASAP. For both parties time is money.
Reason No 3: Finding the right person is increasingly difficult.
Freelance response: Taking control of your human assets is key / Specialty marketplaces exist.
With news of a global talent crunch creating a multi-industry 85 million staff shortage (by 2030) this is no time to ignore your business resource needs.
Finding highly skilled talent is going to become increasingly difficult. Keeping them will also prove tricky as more and more workers seek out a flexible lifestyle (read all about that here).
Within this volatile environment the cost of not hiring someone at all causes more harm than actually spending the money on a new hire. Missed brand growth, overworked teams (on the edge of resigning) and lost profits are just some of the scary results of not investing in the right talent. The good news is that businesses have support. As discussed in this Jon Younger piece, speciality marketplaces are an answer. From pre-screening and shortlisting curated candidates, to keeping the entire hiring process on one platform (including contracts, timesheets and future work schedules) they take away a lot of the recruitment hassle without adding to expensive HR costs.
Reason No 4: I need resources for a temporary project / My problem is short term.
Freelance response: You don’t have to commit long term.
Going through a rebrand, a store opening, a restructure or an expansion? You need someone to fill a gap quickly, not join the bottom line forever. Again the joy of hiring freelance talent is that you can hire for a week, a month or a year. Your contract, your rules. If you need the resource, extend the dates. If you are done, the contract is done. No major restructure required.
Reason No 5: What about quality?
Freelance response: You don’t have to compromise.
According to MBO Partners, there have never been more people working independently. In 2022, full time US freelancing grew 59%, raising the total to a huge 21.6 million. In the UK there are currently around 4.32 million self-employed individuals. Europe comes in at a healthy 22 million. The gap in permanent hires is growing as more and more talent move towards a post-pandemic freelance lifestyle. Coupled with that, the incoming workforce is more likely to participate in this freelance economy. In 2022, 43% of all Gen Z professionals and 46% of all Millennial professionals performed freelance work. As these individuals move into more and more senior roles it’s doubtful that their perception of working styles will change.
What we also need to understand is that while the flexible economy is growing at a rapid pace. This talent is able to work dynamically in a way that many long term hires might not be able to. They are able to pivot quickly, using a breadth of experience that they have accumulated by working with similar brands and hone in on work parameters efficiently as they have been brought on board to problem solve. This experienced talent is out there and will continue to grow in the freelance sector. It’s more a question of finding the right talent for your brand…
Reason No 6: Will a freelancer understand my brand?
Freelance response: The right freelancer speaks your language.
The fashion and luxury sector cannot be likened to finance or tech. Fashion brands tend to fear multi-industry recruitment agencies or freelance talent that might not understand the language, brand vision or space that a product inhabits. Specialised recruitment platforms can help find industry specific talent. They are able to sift through and weed out any CV’s that aren’t of the quality that their clients are looking for. Supplying their clients with anything less than the best means losing repeat business.
The same goes for good freelancers who need to remain relevant. As they work on more and more brands, they gain the ability to adapt to new environments and understand individual brand aesthetics, cultures and values. You are gaining an independent expert who is able to jump onto your project quickly and effectively. They know that repeat business depends on their unique skill set so they are keen to commit.
The human element of your brand is often seen as a business expense but the more you invest the more you are rewarded. Any other reason to hire freelancers that I haven’t thought of? Drop me a comment or a question. Let’s keep the conversation going.
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